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1 8 - 4 7 . BENCHMARKING, ETHICS. Brown Industries operates several laminate flooring plants. Given the competitive pricing for flooring, Brown's managers pay close
BENCHMARKING, ETHICS.
Brown Industries operates several laminate flooring plants. Given the competitive pricing for flooring, Brown's managers pay close attention to costs. Each plant uses a processcosting system, and at the end of every quarter, each plant manager submits a production report and a productioncost report. The production report includes the plant manager's estimate of the percentage of completion of the ending work in process as to direct materials and conversion costs, as well as the quantity sheets of laminate flooring completed. The corporate controller uses these estimates to compute the cost per equivalent unit of work done for each input for the quarter. Plants are ranked, and the two plants with the lowest cost per equivalent unit for direct materials and conversion costs are each given a bonus and recognized in the company newsletter.
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