Questions and Answers of Fundamentals Cost Accounting

Refer to the information in Problem 4-75.Requireda. A local engineering firm claims it can revise the production process such that product X-2 only requires 1.6 machine hours on the shared machine.
?Clarke Corporation manufactures three products (X-1, X-2, and X-3) utilizing, in one of the processes, a single machine for all products. Data on the individual products follow. The single machine
Bubble Company produces a variety of bottles from recycled plastic. The company has one particular machine on which it can produce either of two types of water bottles, 1-liter bottles or 1/2-liter
CompDesk, Inc., makes a single model of an ergonomic desk (with chair) for computer usage. The desk is manufactured in building 1, and the chair is manufactured in building 2. Monthly capacities and
Refer to the details in Problem 4-62.RequiredWhat are the issues, ethical and otherwise, that arise with the product manager’s suggestion?Problem 4-62Metal
DBU Systems manufactures testing equipment for the communications industry. In developing a new device for maritime communication, the design group has estimated the following unit costs.Metal
Reunion Enterprises is considering a new video streaming device for homes. The analyst has collected some information about the product design summarized as follows.Prime cost per unit
Innerspace, Inc., produces drones. The market research department at Innerspace, Inc., gets an idea to market the drone technology, which is a small computer, to the auto industry for use in
Polar Industries makes refrigerators. Polar’s management wants to market refrigerators to students in dorm rooms and small apartments by making a compact refrigerator. The competition, led by
Christine?s Chronographs makes two models of a high-end watch?the model 94 and the model 101. Both models go through a special polishing step that requires the use of the single polishing machine at
Pappy?s Toys makes two models of a metal toy?Standard and DeLuxe. Both models are produced on a single machine. The price and costs of the two models appear as follows. The one machine that used to
Andreasen Corporation manufactures thermostats for office buildings. The following is the cost of each unit.Materials
Consider the Business Application item, “Take-Back Laws and Product Design.” What are the major differential costs between the two strategies discussed in the item (change product design versus
Consider the Business Application item, “Cost-Volume-Profit Analysis and On-Demand Services” in Chapter 3. When the executive says, “If we turn it over X amount of times, per-unit it becomes
What costs should be considered for a special order?
Refer to the Business Application discussion of accounting choices. In the case of Tesco, managers made choices about the timing of revenues and expenses that led to fraud charges. In order to avoid
Will studying cost accounting increase the chances that The AM Bakery will succeed? How? Will it guarantee success? Explain.
Hostess Brands makes a variety of baked goods just like The AM Bakery. In what ways are the cost accounting issues the same? In what ways are they different?
An airline executive asks you, “How would you calculate the cost of a passenger?” What will be your first question to the manager?
Who are the customers of cost accounting?
State University Business School (SUBS) offers several degrees, including Bachelor of Business Administration (BBA). The new dean believes in using cost accounting information to make decisions and
Refer to the information in Exercise 1-31. The dean of the Business School is considering expanding the BBA program by offering an evening program in a nearby city. The new evening program would be
You have been asked by two of your friends, Marco and Jenna, to settle a (friendly) argument they are having about splitting the cost of a road trip during spring break. They will take Jenna’s car
KC Services provides landscaping services in Edison. Kate Chen, the owner, is concerned about the recent losses the company has incurred and is considering dropping its lawn services, which she feels
Gilman?s Caf? is a popular restaurant in a local tourist town. Sarah Gilman, who opened the restaurant five years ago, has seen it grow steadily.Currently, Gilman?s is only open for dinner, but many
The cost accountant for Angie’s Apparel has compiled the following information for last month’s operations.Administrative costs ..................................$ 42,000Merchandise inventory,
Is “cost-of-goods sold” an expense? Is “cost-of-goods” a product cost or a period cost?
Palmetto Computer Shop is a small business located on the South Carolina coast. It specializes in computer repair and is known in the area for fast, reliable, and friendly service. Jeff Branson, the
Casey’s Cases sells cell phone cases in a mall kiosk. Casey charges $30 per case. The variable cost for a case, including the case, the royalty paid to the mall, and so on, is $26. The monthly
Central Company manufactures a sensor used in various electronic devices.The product’s price and cost characteristics are as follows.Selling price per unit ..................$ 13Variable cost per
Refer to the data for Pampa Parts in Exercise 3-44.RequiredSuppose Pampa expects to sell 8,150 units of NF-9 next year, but the price is uncertain. Using the Goal Seek function in Microsoft Excel,
Hamilton Tours offers small group tours of the local area. The cost of a tour is $125 per person and the variable costs are $50 per person. Fixed costs for the quarter are $196,800.Requireda. What is
What is the function in Microsoft Excel that you can use for CVP analysis?
Consider the Business Application, “Break-Even Analysis Used by Big Oil.” In a part of the article not quoted in the text, one definition of the break-even measure that some firms use is, “the
Bristol Car Service offers airport service in a mid-size city. Bristol charges $50 per trip to or from the airport. The variable cost for a trip totals $12, for fuel, driver, and so on. The monthly
Bando Corp. sells a single part for a price of $37 per unit. The variable costs of the part are $13 per unit and monthly fixed costs are $120,000.Requireda. What is the break-even level of monthly
Sophia’s Restaurant served 5,000 meals last quarter. Sophia recorded the following costs with those meals.Variable costs:Ingredients used .....................................$14,000Direct labor
Refer to the data in Exercise 2-48.Variable costs:Ingredients used ...............................$14,000Direct labor ..........................................10,500Indirect materials and supplies
Consider the Business Application, “Indirect Costs and Allocating Costs to Contracts.”Requireda. How should Greenfield Consultants allocate indirect costs to units? Why?b. What ethical issues
Pampa Parts produces a single product, the NF-9. The product has a unit variable cost of $70 and annual fixed costs of $343,200. Pampa is subject to a 20 percent tax rate.RequiredSuppose the NF-9
Pfizer Inc., a pharmaceutical firm, incurs many types of costs in its operations. RequiredFor each cost in the following table, identify the stage in the value chain where this cost is incurred.
Tesla, Inc., incurs many types of costs in its automobile operations. RequiredFor each cost in the following table, identify the stage in the value chain where this cost is incurred. Stage In the

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