Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Brokia Electronics manufactures three cell phone models, which differ only in the components included: Basic, Photo, and UrLife. Production takes place in two departments, Assembly

image text in transcribedimage text in transcribed

Brokia Electronics manufactures three cell phone models, which differ only in the components included: Basic, Photo, and UrLife. Production takes place in two departments, Assembly and Special Packaging. The Basic and Photo models are complete after Assembly. The UrLife model goes from Assembly to Special Packaging and is completed there. Data for July are shown in the following table. Conversion costs are allocated based on the number of units produced. There are no work-in-process inventories. Total $2,300,000 Basic (20,000 units) $ 490,000 Photo (20,000 units) $ 1,210,000 UrLife (10,000 units) $ 600,000 Materials Conversion costs: Assembly Special Packaging Total conversion costs $2,127,500 610,000 $ 2,737,500 Required: a. What is the cost per unit transferred to finished goods inventory for each of the three phones in July? b. The UrLife model is sold only to the government on a cost-plus basis. The marketing vice president suggests that conversion costs in Assembly could be allocated on the basis of material costs so he can offer a lower price for the Basic model. 1. What cost would be reported for the three models if the marketing vice president's suggestion is adopted? 2. Would this be ethical? Assume the conversion costs are not related to material dollars. Complete this question by entering your answers in the tabs below. Req A Req B1 Req B2 What is the cost per unit transferred to finished goods inventory for each of the three phones in July? (Do not round intermediate calculations. Round your answers to 2 decimal places.) Cost Per Unit Basic Photo UrLife Req A Req B1 Req B2 The UrLife model is sold only to the government on a cost-plus basis. The marketing vice president suggests that conversion costs in Assembly could be allocated on the basis of material costs so he can offer a lower price for the Basic model. What cost would be reported for the three models if the marketing vice president's suggestion is adopted? (Do not round intermediate calculations. Round your answers to 2 decimal places.) Show less A Cost Per Unit Basic Photo UrLife

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Rethinking Clinical Audit Psychotherapy Services In The NHS

Authors: Rachael Davenhill, Matthew Patrick

1st Edition

0415162084, 978-0415162081

More Books

Students also viewed these Accounting questions