Continuous improvement (continuation of 7-43). Horizons receives a suggestion that continuous improvement standard costs be used and
Question:
Continuous improvement (continuation of 7-43). Horizons receives a suggestion that continuous improvement standard costs be used and updated monthly. Consider monthly revisions in 2007 for the three variable manufacturing cost items.
Required 1. Assume the data in Problem 7-43 is the December 2006 standard. The January 2007 standard is 0.995 times the December 2006 standard. The February 2007 standard is 0.995 times the January 2007 standard. Using the data from Problem 7-43, what is the standard for the direct materials usage for each variable cost item in January and February 2007?
2. What are the pros and cons of using the approach in
(a) as die primary approach to drive the cost competitiveness of Horizon?
Step by Step Answer:
Cost Accounting A Managerial Emphasis
ISBN: 9780131971905
4th Canadian Edition
Authors: Charles T. Horngren, George Foster, Srikant M. Datar, Howard D. Teall