Value-Stream Costing Objective During the week of June 12, Harrison Manufacturing produced and shipped 16,000 units...
Fantastic news! We've Found the answer you've been seeking!
Question:
![image](https://dsd5zvtm8ll6.cloudfront.net/si.experts.images/questions/2024/04/662a6840ac957_232662a68407dad4.jpg)
![image](https://dsd5zvtm8ll6.cloudfront.net/si.experts.images/questions/2024/04/662a68412fa3f_233662a684115df1.jpg)
Transcribed Image Text:
Value-Stream Costing Objective During the week of June 12, Harrison Manufacturing produced and shipped 16,000 units of its aluminum wheels: 3,800 units of Model A and 12,200 units of Model B. The cycle time for Model A is 0.80 hours and that of Model B is 0.55 hours. The total net work hours for the aluminum wheel value stream for the week were 15,000. The following costs were incurred: Order processing Production planning Purchasing Stamping Welding Salaries/ Materials Wages $365,000 $18,000 321,600 25,200 36,500 Machining $37,000 40,000 Other Total Cost $18,000 321,600 25,200 $18,400 456,900 12,000 232,000 335,000 11,000 11,000 10,000 10,000 13,800 13,800 $840,000 $476,100 $77,000 $30,400 $1,423,500 140,000 40,000 09 Cladding Testing Packaging and shipping Invoicing Total Required: 335,000 1. Assume initially that the value-stream costs and total units shipped apply only to one model (a single-product value stream). Calculate the unit cost. Round your answer to the nearest dollar amount. $ 89 per unit 2. Model A is responsible for 40 percent of the materials cost. Using the average conversion cost approach, calculate the unit cost for Models A and B. Round your answers to the nearest dollar amount. Unit Cost Required: 1. Assume initially that the value-stream costs and total units shipped apply only to one model (a single-product value stream). Calculate the unit cost. Round your answer to the nearest dollar amount. $ 89 per unit 2. Model A is responsible for 40 percent of the materials cost. Using the average conversion cost approach, calculate the unit cost for Models A and B. Round your answers to the nearest dollar amount. Unit Cost Model A Model B $ 75 X 3. What if Model A and Model B are not homogeneous products? Assume the same materials usage as in Requirement 2. Use DBC to calculate the unit cost for the two products. Round your interim calculations and final answers to the nearest dollar amount. Unit Cost Model A $ 583,500 X Model B $ 919,500 X DBC should be used if the products are not Explain when and why this cost is more accurate than the unit cost calculated in Requirement 2. Explain why DBC is a good approach for value-stream costing. homogeneous products. Even when the products are homogeneous it is simple and easy to use. DBC is more accurate as it approximates ABC assignments. Value-Stream Costing Objective During the week of June 12, Harrison Manufacturing produced and shipped 16,000 units of its aluminum wheels: 3,800 units of Model A and 12,200 units of Model B. The cycle time for Model A is 0.80 hours and that of Model B is 0.55 hours. The total net work hours for the aluminum wheel value stream for the week were 15,000. The following costs were incurred: Order processing Production planning Purchasing Stamping Welding Salaries/ Materials Wages $365,000 $18,000 321,600 25,200 36,500 Machining $37,000 40,000 Other Total Cost $18,000 321,600 25,200 $18,400 456,900 12,000 232,000 335,000 11,000 11,000 10,000 10,000 13,800 13,800 $840,000 $476,100 $77,000 $30,400 $1,423,500 140,000 40,000 09 Cladding Testing Packaging and shipping Invoicing Total Required: 335,000 1. Assume initially that the value-stream costs and total units shipped apply only to one model (a single-product value stream). Calculate the unit cost. Round your answer to the nearest dollar amount. $ 89 per unit 2. Model A is responsible for 40 percent of the materials cost. Using the average conversion cost approach, calculate the unit cost for Models A and B. Round your answers to the nearest dollar amount. Unit Cost Required: 1. Assume initially that the value-stream costs and total units shipped apply only to one model (a single-product value stream). Calculate the unit cost. Round your answer to the nearest dollar amount. $ 89 per unit 2. Model A is responsible for 40 percent of the materials cost. Using the average conversion cost approach, calculate the unit cost for Models A and B. Round your answers to the nearest dollar amount. Unit Cost Model A Model B $ 75 X 3. What if Model A and Model B are not homogeneous products? Assume the same materials usage as in Requirement 2. Use DBC to calculate the unit cost for the two products. Round your interim calculations and final answers to the nearest dollar amount. Unit Cost Model A $ 583,500 X Model B $ 919,500 X DBC should be used if the products are not Explain when and why this cost is more accurate than the unit cost calculated in Requirement 2. Explain why DBC is a good approach for value-stream costing. homogeneous products. Even when the products are homogeneous it is simple and easy to use. DBC is more accurate as it approximates ABC assignments.
Expert Answer:
Related Book For
Cornerstones of Cost Management
ISBN: 978-1285751788
3rd edition
Authors: Don R. Hansen, Maryanne M. Mowen
Posted Date:
Students also viewed these accounting questions
-
Discuss the implications of dynamic pricing strategies on revenue management and consumer behavior.
-
During the week of June 12, Harrison Manufacturing produced and shipped 15,000 units of its aluminum wheels: 3,000 units of Model A and 12,000 units of Model B. The following costs were incurred:...
-
During the week of August 21, Parley Manufacturing produced and shipped 4,000 units of its machine tools: 1,500 units of Tool SK1 and 2,500 units of Tool SK3. The cycle time for SK1 is 0.73 hour, and...
-
The Cano Company is decentralized, and divisions are considered investment centers. Cano has one division that manufactures oak dining room chairs with upholstered seat cushions. The Chair Division...
-
Perform an environmental analysis for the Washington Post Company. Which segment of the environment is causing the companys problem(s)?
-
For the past few years, your client, Chow Medical Group (CMG), has operated a small medical practice. CMG's current annual revenues are $420,000. Because the accountant has been spending more and...
-
If a long-term liability account increases, how should it be presented? a. as an increase in cash in the Operating Activities category b. as an increase in cash in the Financing category c. as a...
-
Unique Creations holds a monopoly position in the production and sale of magnometers. The cost function facing Unique is estimated to be TC = $100,000 + 20Q a. What is the marginal cost for Unique?...
-
1. Under/Over Valued StockA manager believes his firm will earn a 11.80 percent return next year. His firm has a beta of 1.42, the expected return on the market is 9.2 percent, and the risk-free rate...
-
Judy Keel, age 45, works for a small corporation in the Research and Development department. When she first became a member of the department 15 years ago, Judy was an unusually creative and...
-
Describe the application of Cost-Volume-Profit analysis to a new restaurant concept. Explain in detail by giving examples?
-
What mechanisms do change catalysts harness the synergistic potential of interdisciplinary collaboration and cross-functional integration, orchestrating a harmonious convergence of divergent...
-
Chen Company uses a standard cost system. As such, all its inventories are carried on the books at standard, not actual, cost. During the most recent accounting period, the company had the following...
-
A company produces steel rods. The lengths of the steel rods are normally distributed with a mean of 129.4-cm and a standard deviation of 2.3-cm. For shipment, 26 steel rods are bundled together....
-
can someone answer and explain the steps so I can understand please Coast-to-coast Inc. is considering the purchase of an additional delivery vehicle for $47,000 on January 1, 2011. The truck is...
-
Leo is a manufacturer of large cement block company. The standard materials quantity is 0.5 pound of cement per block at a standard price of $1.60 per pound. The actual quantity for the production of...
-
2) Cul de los siguientes debe clasificarse como activocirculante?A. Inversiones inmobiliarias C. Activos financieros mantenidospara negociarB. Propiedad, planta y equipo D. Valor de rescate en 1...
-
The National Collegiate Athletic Association (NCAA) and the National Federation of State High School Associations (NFHS) set a new standard for non-wood baseball bats. Their goal was to ensure that...
-
Amortization of Discount Ortega Company issued five-year, 5% bonds with a face value of $50,000 on January 1, 2008. Interest is paid annually on December 31. The market rate of interest on this date...
-
The Russo Theater will begin operations in March. The Russo will be unique in that it will show only triple features of sequential theme movies. As of March 1. the ledger of Russo showed: No. 101...
-
Amortization of Premium Assume the same set of facts for Ortega Company as in Problem 10-2A except that the market rate of interest of January 1, 2008, is 4% and the proceeds from the bond issuance...
![Mobile App Logo](https://dsd5zvtm8ll6.cloudfront.net/includes/images/mobile/finalLogo.png)
Study smarter with the SolutionInn App