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1 - ( just this question to develop please A - - Suppose a customer offers you a huge contract for your product ( from
just this question to develop please
ASuppose a customer offers you a huge contract for your product from the first assignment This customer will pay you less than your normal charge, but will order units of your product. Using CVP analysis and the costs that you established in Assignment One, should you take the offer or not? This is a special order decision.
This requires you to think about the costs will you lose money along with other considerations is this a customer who will bring enough business in the future to make it worth losing money now? Is it your favorite uncle and you can't say no and still be invited to the family reunion? :)
This assignment should be no more than a page, write your conclusion and show how you reached it
Below I leave those tables with numbers that will be used as a reference to develop the quetion
the next step is only for reference to question which must be developed.
ITEM Cost per Unit Classification
Fabric $ Product
Interfacing $ Product
Hardware $ Product
Sewing Machine Monthly Cost Period
Thread Monthly Cost Period
Pliers Onetime Cost Product
Workspace Rental Monthly Cost Period
Sales Venue Rental Monthly Cost Period
Monthly Costs :
Fabric and Interfacing: hair tie per yard
Hardware : per hair tie
Planing to make hair tie in a month
Fabric and Intefacing Cost :$ hair tie x hier tie
Fabric and Interfacing Cost : $ x
:$
Hardware Cost : $x
:$
Total Product Costs
Total Product costs : Fabric and Interfacing Cost Hardaware Cost
:$
:$
Monthly Period Cost : Sewing Machine Thread Pliers, Wrokspace Renat, Sales Venue Rental
Wok in Process WIP and Finished Goods
Date Account Dr Cr
devid WIP $
Raw Materials inventory $
fabric and Interfacing
Raw Materials inventory $
Work in Process
Date Account Dr Cr
finished goods inventory $
Work in Process $
finished goods
Cost of Goods Sold Upon Sale Of key Fobs
Date Account Dr Cr
Cost Of Goods Sold $
finished goods inventory $
Cost Of Goods Sold
Monthly Period Costs:
Debit respective expense accounts eg Sewing Machine Expense, Thread Expense, Rental Expense for their monthly costs.
Explanation:
Period Costs: Costs associated with running the business that are not tied directly to the production of goods. Monthly costs like sewing machine usage, thread, and workspace rentals fall into this category.
Upon selling the hair tie, the costs are transferred from Finished Goods to COGS.
This process ensures proper accounting for the costs associated with manufacturing a product and the subsequent
QUETION
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