Questions and Answers of Financial And Management Accounting

In this problem, you are simply going to add process codes from the APQC Framework found on pages 429-433 to the activities performed in each of the Mktg, Gen & Admin Dept worksheets. (You can
Miles Industries makes a number of different molds used by other manufacturing companies to produce plastic products. The molds are made using special numerically controlled equipment that can be
Nancy Godden is the owner of a small florist shop. Orders are taken via electronic sources for three national services that contract with local flower shops to make and deliver the actual flower
What is a process? Can you think of several processes that take place in your university?
The objective of this exercise is to attach costs for the Marketing, General, and Administrative Departments to specific activities performed by these departments. The data worksheets you will need
DC Watts, Inc., makes power cords for a variety of electronic products. Lately, it has been having significant problems with the quality of its output. It also appears that making a batch of power
Bruce Calloway of Buy Rite Shopping Service has decided it may be time to improve the flow of his back office. He collects the following list of activities that take place during the customer
What does the term process management mean? What are the six key concepts that define a process management approach? How does the definition of a process impact how management approaches its work?
For the following list of measures, please note whether they are cost- related (C), productivity- related (P), quality- related (Q), or delivery- related (D). Measurement Category Measurement
Identify the key types of variances looked at in the product domain. How are they calculated?
For the following list of measures, please note whether they are cost- related (C), productivity- related (P), quality- related (Q), or delivery- related (D). Measurement Category Measurement
How are balanced scorecards used in the product domain?
Ache-No-More Company makes specialty chairs designed to take stress off of the lower back, reducing the tendency to get backaches from sitting too long. The chairs are very high-end, ranging from
For the following list of quality problems for a lawn mower, note whether it is an internal quality failure (I) or an external quality failure (E). Quality Problem Rework of motor housing Quality
Develop a list of potential measures of a product’s performance, identifying each as financial (F) or nonfinancial (N).
Hop-a-Long Company makes rocking horses for the children’s market. Recently it has been thinking of making a larger horse that would be suspended on springs; the current models sit on the floor and
For the following list of quality problems, note whether it is an internal quality failure (I) or an external quality failure (E). Quality Problem Category Quality Problem Category Warranty repairs
How does the continuous improvement philosophy affect the attainment phase of target costing?
Clear Skin, Inc., makes pump liquid soap dispensers. It currently makes all of the components that go into the pump dispenser on its high-end extrusion machines. A competitor has offered to supply
Using the data from the table in Exercise 5, create a Pareto chart for each of the popcorn products. How do they compare now? Which chart is easier to use? Why?Data From Exercise 5 Feature Caramel
What does the term “tight but attainable” goal mean in the context of setting standards?
Blue Jay Products makes Ever Blue, which is used to fertilize hydrangeas and keep their blossoms blue. The company usually sells through a distribution network for $15 per five-pound bag. Normal
Big Top Pops makes a variety of popcorn products. It recently conducted a customer focus group and obtained the following results for three of its more popular products.REQUIRED:a. Create a RADAR
How are standards developed and used during the production of products?
Wear Well Products makes a line of countertop grills for making hamburgers and related grilled products like panini. The following table contains information about the production of its countertop
Using the data in the table for Exercise 3, create a Pareto chart for each of the jams. How do they compare now? Which chart is easier to use? Why?Data From Exercise 3 Feature Strawberry Raspberry
Name the primary activities to focus on for cost reduction during the attainment phase.
Built Rite produces suitcases. The following are the results of last month’s production.REQUIRED:a. Using the table- based approach pictured in Table 7.7, decompose the variances for the month into
Best Ever Jams makes strawberry, raspberry, and blueberry jams. The following scores reflect the results of a consumer panel that evaluated its jams. Ten is the highest, and zero is the lowest
What role does the cost gap play in the attainment phase of target costing?
Rubens Company makes a number of special-edition glass perfume bottles. Each year, the company comes out with a new set of 12 bottles, which customers can buy either one at a time or as a set. The
The overarching goal is to calculate the profitability of Kinkaid’s finished goods products using ABC charging rates for upstream departments, manufacturing support departments, and ABC-based
Silver Spoons makes silverware and stainless steel eating utensils. It is considering adding a new line, a silver-clad stainless steel line that would give the look and feel of silver but cost
Hercules Fitness makes a line of fitness machines. It recently decided to enter the elliptical trainer market. The company designed a trainer that would cost the customer $995. Hercules’s target
What are the key factors considered during the attainment phase of target costing?
Sarah Drogo, president of Storage, Inc., a company that makes a wide variety of storage boxes for home and office use, is thinking about adding a new line of small plastic storage boxes. This would
In this exercise, you are going to create a capacity report for the Cutting Department at Kinkaid following the steps below.a. Using the worksheet “DB 7-1 Cutting Data Template” provided for you
Sunshine Products makes lawn furniture in various styles. Recently, it decided to launch a new line of reclining lawn chairs for poolside use. The design team put together the following
Blue Goose Kitchenware produces a wide variety of kitchen tools. It has just developed the Handy Opener, which automatically opens jars of various sizes. The target price is $8.95, and Blue Goose
What is a product or service value proposition? How does it affect customer purchase decisions?
What does the term life cycle costing mean? When do we use life cycle costs?
How does activity costing differ from departmental costing methods?
Define the key differences between plant-wide and departmental overhead rates.
What does the term prime cost mean? Conversion cost? How do we use them in costing products?
NewsCorp prints and sells a variety of news magazines and newspapers on presses that run on the company’s presses 24 hours a day, seven days a week. This has always been the cheapest way to produce
Stuart’s Oil Refinery runs on a 24/7 clock. For the month of January, it had 20,000 gallons in process at the beginning of the month, added 400,000 gallons to the process, and had 30,000 gallons in
Identify and define the three main components of a product cost.
Time Tells makes children’s storybooks in a continuous run. It changes plates while the large machines are running, losing roughly 100 copies in the changeover process. This has long ago been
Using the information in Exercise 9, charge out the general overhead using machine hours.REQUIRED:a. How much total cost is there in the cell including this overhead?b. How much does it cost per good
What is the defining feature of an assembly line? How does cellular manufacturing incorporate the strengths of an assembly line at the same time as it allows for different features in output units?
Best Brew Coffee, Inc., makes single-serve coffee pots that use coffee pods. It has become very popular. Even though the cost per cup is greater than for brewed coffee, the freshness and variety
Best Made Electronics makes a variety of cellular telephone units. It uses cellular manufacturing. All of the costs incurred in the cell get charged to good units produced. It also pays its share of
Describe a situation that would be best served by using job order costing. Why did you choose this setting?
New Dawn Cleaning Supplies makes a variety of cleaning products, including powder cleansers, window-washing fluid, and dishwashing soap. The company currently has $10,000,000 in overhead, which it
Using the information in Exercise 6, charge general overhead on direct labor hours first; then re-total your overhead by department. Next, charge out the total overhead in a department using the
What are the five ways work can be organized in manufacturing or service firms?
Zippy Bags manufactures plastic bags with zippers for the consumer market. It makes the product in three sizes: one pint, one quart, and one gallon. It produces the product in large batches using the
Using the information in Exercise 6, recalculate your plant-wide overhead rate using machine hours as the driver. How much overhead gets charged to each department now?Data from Exercise 6 Wholesome
What is the difference between a committed and an incurred cost? Which is more actionable before a product is designed? After a product is designed?
Made-Rite Foods makes several lines of sauces, including barbecue sauce and hot sauces, on a large batch basis. The products use different departments at the company, including Batch Preparation,
Wholesome Oats makes several lines of breakfast cereals using large batch manufacturing. It takes three departments—Prepping, Blending, and Boxing—to make the products. It also has a general
Describe the attainment phase of target costing. What are its primary objectives?
Brewer’s Magic makes the basic yeast and flavoring packets for the home beer-brewing industry. It makes these products in large batches on a repetitive basis, so it has gotten to know quite a bit
Using the information in Exercise 3, recalculate the cost of Job 123 using machine hours for the overhead on the black and white printer and the color printer, and direct labor hours for the binding
What is a firm’s target cost? How is it used during the new product development stage?
Jenny’s Painting Company paints and power-washes for industrial and residential customers. The company currently charges all overhead out on direct labor hours but is considering making changes
Using the information in Exercise 3, recalculate the cost of Job 123 using machine hours for both the machine costs and the overhead costs. How much does Job 123 cost now?Data from Exercise 3 Josie's
How is a target price established in a competitive market with similar offerings? If it is a new market, how is price established?
Dan’s Custom Cabinets makes stereo cabinets for new homes and remodeling jobs. Dan crafts each cabinet to fit special places and uses solid wood throughout, making his cabinets of much higher
Josie’s Copy Shop performs a variety of copy jobs for its customers. Job 123 takes 500 sheets of paper at $0.01 per sheet and 10 bindings at $0.25 per binding. It takes 10 minutes of labor and 15
During the establishment phase of target costing, what main activities take place?
Drip-No-More, Inc., makes various faucets for home use. It has a patented design feature that practically ensures there will be no dripping from the faucet in the first 10 years of use. This patented
Green Hills makes coffee pods for one-cup coffee machines. It was recently approached by Tracy ’s Coffees, a high-end coffee shop, to see if it can make pods for its special blends of coffees.
What does the term target costing mean?
Better Yet Dishware produces dishes and drinking mugs for a large domestic market. It uses both traditional retail outlets and its own company stores where slightly flawed product is sold. Decorating
The emphasis in this exercise is on first assigning overhead to departments with different drivers, and then looking at the impact of using direct labor hours at the departmental level as the
Sparrows Specialty Products makes a wide variety of specialty home products. Joey Sparrow, the owner, has recently decided to add a special type of wine opener—one with a granite base that can be
Sam’s Sports makes several lines of tennis racquets. Recently, Sam decided to carry an entire line of graphite racquets. He has done his competitive analysis and found that his competitors’
What is the product domain and why is it so important to companies?
Easy Sweep makes vacuum cleaners for both residential and commercial customers. It has been making vacuum cleaners for more than 50 years, starting with one small model that was sold door-to-door. It
To get started, you’ll need the workbook DB 6-1. Using the overhead driver “Material Dollars,” you are to develop an overhead rate using this driver, and then apply it to the individual units
What is incremental analysis and when do we use it?
There are two labor departments in the following business. Their results for September are in the following table. Please develop a price v s. efficiency variance for each of these two departments.
Samson, Inc., is trying to understand the causes behind some ongoing problems it is having in making good kitchen cabinets for its customers. It decides to do a cause-and-effect diagram using four
The worksheet in workbook DB 5.2 named Summary Easy Air provides all of the raw data you will need for this exercise.REQUIRED:a. Do a three-year trend analysis of the four basic problems plaguing
Using the data in Exercise 5, perform a percentage change, or trend analysis, of Angie’s sales. Do you spot any patterns in sales?Data From Exercise 5 November December Type of Job October Units
Using the data in Exercise 3, perform a percentage change, or trend analysis, of Ernesto’s sales.Data From Exercise 3 Type of Sub Sandwich Planned Sales (a) Actual Sales (b) Italian meats 100 125
Now that Bill has gotten another class under his belt, he wants to understand the relative impact, in percentage terms, of the changes in his business. So using the data from Problem 1
Define a firm’s competitive cost. How is it related to market price?
Tony ’s Pizza makes a variety of pizzas and grinders for local customers. He needs to set the price of a regular pizza, which has two ingredients. Tony’s costs for making a pizza are as
What is the difference between tracing and assigning a cost? Between assigning and allocating a cost? Why is this important?
Speedy Print is a small copy shop that has both black and white and color printers. It also offers a range of binding choices. The cost for running the shop are:REQUIRED:a. Speedy Print takes a job
List the steps needed to develop an activity-based cost.
What are the key differences between capacity- and activity-based costing? When should each be used?
Define the term cost object and give at least one example of a cost object.
Define cost-plus pricing. When is it the preferred way to price a job? When is it not a good way to price a job?
What are the five basic problems the planning activity attempts to resolve?
Westerly Cable offers a series of products such as cable television, telephone service, internet service, and an entire range of business products. Recently the company has been receiving a lot of
Troy hill Manufacturing makes a variety of lawn products. It keeps track of problems that occur during the manufacturing process. The results of the tracking of number of occurrences for the company
Easy Air has decided to look at a couple of options for dealing with its late flight problem. While the number of solutions could be endless, it has narrowed it down to two: increase the turn time

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