Traditional Product Costing versus Activity-Based Costing
Ridgeland Inc. makes backpacks for large sporting goods chains that are sold under the customers' store brand names. The Accounting Department has identified the following overhead costs and cost drivers for next year:

Project 7: Evaluating Recruiting Sources

The purpose of this exercise is to (a) conduct an in-depth analysis of various recruitment sources and (b) recommend the ideal mix of sources for an organization.

Using the data above, compute the following:

• Cost per hire
• Cost per 6 month of survival
• Cost per 1 year of survival
• Cost per above average performer

What is your best source and why?

What is the worst source and why?

If no one source could supply more than 40% of the total number of hires needed, what mix of recruitment sources would you recommend and why?

Tinkle-Tinkle Glass Company makes glass globe paper weights for desks. The company uses a job-order cost system and predetermined overhead rates to apply manufacturing overhead cost to jobs. The predetermined overhead rate in the Fabrication Department is based on machine hours, and the rate in the Finishing Department is based on direct labor hours. At the beginning of the year, the company’s management made the following estimates for the year:

                                                                                                            Department

                                                                                                Fabrication       Finishing

Machine hours                                                                         83,000            28,000

Direct labor hours                                                                     30,000            43,000

Direct material cost                                                                 $412,000            $213,000

Direct labor cost                                                                      $299,000            $692,000

Fixed manufacturing overhead cost                                            $799,000           $279,000

Variable manufacturing overhead per machine hour                       $2.05                    --

Variable manufacturing overhead per direct labor hour                       --                  $2.00

Job 25 (the Christmas holiday special) was started on August 1 and completed on August 31. The company’s cost records show the following information concerning the job:

                                                                                                            Department     

                                                                                                Fabrication       Finishing

Machine hours                                                                                  315                   80

Direct labor hours                                                                              105                 125

Direct materials cost                                                                      $1,305          $1,030

Direct labor cost                                                                                $880              1,085

Compute the predetermined overhead rate used during the year in the Fabrication Department. (Round to two decimal places.) Do the same for the Finishing Department. (Round to two decimal places.) Be careful to use the proper cost driver.

Compute the total overhead cost applied to Job 25 (in dollars and cents).

What would be the total cost recorded for Job 25? If Job 25 contained 50 units, what would be the unit product cost? If it contained 800 units, what would be the unit product cost? (Round to two decimal places.)

At the end of the year, the records of Tinkle-Tinkle Glass revealed the following actual cost and

operating data for all jobs during the year:

                                                                                                            Department

                                                                                                Fabrication       Finishing

Machines hours                                                                           87,000               31,000

Direct labor hours                                                                        32,000               30,000

Direct materials cost                                                                 $424,000           $160,000

Manufacturing overhead cost                                                    $712,000           $287,000         

What was the amount of actual overhead in each department at the end of the year? Was it underapplied or overapplied? (You should have a total of four answers for this question.)

Changes in the economy have determined that for the EZ shipping company, a surcharge will be assessed on all packages that meet certain criteria. The surcharge is a function of the characteristics of the package and the zip code to which it is sent.

1. The regular charges for shipping are calculated as follows:
     For all weights five pounds and under, the shipping cost is $12.00.

     For weights over five pounds, the charge is calculated as follows:
                        If length * width * height + weight is:

greater than 5 and less than or equal to 15, the shipping cost is 14.00

greater than 15 and less than or equal to 34, the shipping cost is 17.00

greater than 34 and less than or equal to 45, the shipping cost is 21.00

greater than 45 and less than or equal to 60, the shipping cost is 33.00

greater than 60, the shipping cost is 105.00

2. The additional charges are calculated as follows:

            If the first digit of the zip code is a "4" then there is an additional surcharge of 5% on the shipping cost.

If the first digit of the zip code is a "6" then there is an additional surcharge of 9% on the shipping cost.

For all other zip codes there is an additional surcharge of 14% on the shipping cost.

3. Finally, if the zip code is even, then there is an additional surcharge of 2% of the shipping

            cost.

Write a program that allows the user to input (in this order) the zip code, weight, length, width and height of the package then prints out the following:

The zip code and dimensions of the package

The shipping cost

The surcharge

The total shipping cost (shipping cost plus surcharge(s))

I have written out the code and have been able to get it to run but when I added in the 2% for even numbers portion of my code every thing went weird with my outputs. Every thing still compiles and works but I am not recieving the outputs I desire. Any help remedying this would be greatly appreciated.

import java.util.Scanner;
   //allows use of scanner for keyboard inputs
  
public class Shipping
   // Class titling
{


public static void main(String[] args)

   {

{
int zip;
double weight;
double length;
double width;
double height;
double surcharge;
double surcharge2;
double shippingCost;
  
   //Variables that will need defining for the shipping process
  
Scanner keyboard = new Scanner(System.in);
System.out.println("Hello, Welcome to EZ Shipping services! \n Please input the important details of your shipment when prompted");
System.out.println("What is the weight of your package? ");
weight = keyboard.nextDouble();
System.out.println("What is the length of your package? ");
length = keyboard.nextDouble();
System.out.println("What is the width of your package? ");
width = keyboard.nextDouble();
System.out.println("What is the height of youre package? ");
height = keyboard.nextDouble();
  
//Print outs for package detail inputs

double packages=length*width*height+weight;
//Package variables combined and stored
   {
shippingCost = 12;
//Stock sipping cost 12$

   }
  
if (weight >5)
   {
if (packages >=5.1 || packages <= 15)
   {
shippingCost= 14;
// if the package weight is above 5 but less than 15 the cost is increased to 14$
   }
else if (packages >= 15.1 || packages <= 34 )
   {
shippingCost= 17;
// if the package weight is above 15 but less than 34 the cost is increased to 17$
   }
else if (packages >= 34.1 || packages <= 45)
   {
shippingCost= 21;
// if the package weight is above 34 but less than 45 the cost is increased to 21$

   }
else if (packages >= 45.1|| packages <= 60)
   {
shippingCost= 33;
// if the package weight is above 45 but less than 60 the cost is increased to 33$

   }
else if (packages > 60)
   {
shippingCost= 105;
// if the package weight is above 60 cost is increased to a flat 105$

   }
}
System.out.println("What is your zip code? ");
zip = keyboard.nextInt();
  
if(zip == 4)
   {
surcharge = shippingCost*0.05;
// if the zip code starts with a 4 a 5% surcharge is added
   }
   else if(zip == 6)
   {
surcharge = shippingCost*0.09;
// if the zip code starts with a 6 a 9% surcharge is added
   }
   else
   {
surcharge = shippingCost*0.14;
// all other zip codes have a 14% surcharge added
   }
  
{
  
   if (zip % 2 == 0 );
surcharge2 = shippingCost*.02;
// calculation for if package is even zip code or not, if even add surcharge of 2%
}
double cost = shippingCost + surcharge + surcharge2;
// calculation for cost
double total;
total = shippingCost + surcharge + surcharge2 + packages;
// calculation for total

System.out.print("The Shipping Cost $"+ cost);
System.out.print(" Total with charges $"+ total);
// Final read out
   }
}
}

1.)The monopolistically competitive firm faces a perfectly elastic demand curve.

True

False

2.)A local store noticed that when it increased the price of milk from $2.50 to $3.50 it sold exactly the same amount. Which statement below best describes what that means?

3.)The increase in total cost from one more unit of output is ____.

4.)When MR and MC intersect in two places, the profit-maximizing output will be the one from which MC crosses MR from below.

True

False

5.)For a perfectly competitive firm, the marginal revenue curve _____.

Salatic Co has two types of handbags: standard and custom. The controller has decided to use a plantwide overhead rate based on direct labor costs. The president has heard of activity-based costing system and wants to see how the results would differ if this system were used. Two activity cost pools were developed: machining and machine setup. Presented below is information related to the company's operations: Standard Custom Total Direct labor costs $340,000 $204,000 $544,000 Machine hours 17,000 25,500 42,500 Setup hours 850 680 1,530 Total estimated overhead costs $380,800 Overhead cost allocated to machining cost pool $272,000 Overhead cost allocated to setup cost pool $108,800

Requirement: 1 Compute overhead costs allocated to each product using traditional (plantwide) approach

2 Compute overhead costs allocated to each product using ABC approach

3 Determine the difference and comment on the results.

The following cost data relate to the manufacturing activities of Black Company during the just-completed year:

The company uses a predetermined overhead rate to apply overhead cost to production. The rate for the year was $6 per machine-hour; a total of 10,000 machine-hours were recorded for the year. All raw materials ultimately become direct materials—none are classified as indirect materials.

Required:

1. Compute the amount of underapplied or overapplied overhead cost for the year.

2. Prepare a schedule of cost of goods manufactured for the year.

In this module, it is demonstrated that some times extensive diseconomies of scale, say, due to high transportation costs, would require that the firm produce its product in a multiple of plants.

Suppose a beer brewing company has determined that its monthly total production cost is:

TC = 100 Q - 1.2 Q² + 0 .004Q³  where Q is its monthly output measured in kegs.

A.) The average hauling (freight) cost is $0.8Q; that is: AHC = 0.8Q. Write the firm's average aggregated cost equation.

B.) Now suppose the firm is facing the following market demand:

                                                                                 Q = 4,000 - 10 P

    Determine the optimal number of plants that the firm should have to take full advantage of the market demand.

C. Calculate the firm's profit.

D. Compare the firm's profit with multiple plants with its profit with a single plant.

Hint: The firm's MC equation based on its aggregated total cost (including the freight cost) is:  MC = 100 - 0.8 Q + 0 .012 Q²

Surf Deals had the following inventory (surfboards) information available for June and records their inventory using the periodic inventory method.

Date          Transaction                                            Units                      Unit Cost

June 1       Beginning inventory                                  100                             $200

June 2       Purchase                                                  100                             $220

June 5       Sale @ $350 per unit                                (75)

June 18     Purchase                                                  200                             $225

June 25     Purchase                                                  100                             $230

June 29     Sale @ $360 per unit                                (200)

Assume that the company uses the FIFO inventory method. Develop an inventory worksheet.    

1. What is the total dollar value of the ending inventory on June 30 and the Cost of Goods Sold for June.                                                                                                                                        

                   Inventory:     ___________                                 Cost of Goods Sold:     ___________

2. Assume that the company uses the periodic approach and Weighted Average inventory method. What is the total dollar value of the ending inventory on June 30 and its Cost of Goods Sold for June?                                                                                                                          

          Inventory:     ___________                   Cost of Goods Sold:     ___________

3. Which method would cause Surf Deals to have the highest gross margin? Why?