ACC 550 FINAL PROJECT

Give typing answer with explanation and conclusion

How can CVP analysis be used to predict future costs and profitability? Describe how CVP analysis is used at Salt River Company. Discuss a concept associated with CVP in conversation.  Consider using an article to summarize or apply the CVP concepts.  Please include proper citations.

Two questions

Mastery Problem: Contribution Margin, Cost-Volume-Profit Analysis and Break-Even Point (Overview) Fixed, Variable and Mixed Costs An appreciation of cost behavior is needed in order for management to understand and predict profitability as the costs of material, labor and other operating expenses and levels of production and sales change. It's important to review the cost behavior of fixed, variable and mixed costs before contribution margins, cost-volume-profit analysis, and break-even points.   1.  In the table below, Have-A-Seat Inc. has outlined many of the costs associated with producing office chairs. With respect to the production and sale of office chairs, classify each cost as: a.fixed b.mixed c.variable.   a.  Pressure-molded plastic for chair frames   b.  Pension cost: $0.50 per employee hour on the job   c.  Insurance premiums for inventory: $2,100 per month plus $0.01 for each dollar of inventory over $2 million   d.  Property taxes: $120,000 per year for…

Cost-volume-profit analysis is useful for   Question 8 options:   1)  helping managers to answer "what-if" questions.   2)  implementing a differentiation strategy.   3)  eliminating uncertainty about external factors, such as interest rates.   4)  for long-range planning.   5)  assigning costs to products.

Part 3 Target costing A target cost is 'a product cost estimate derived by subtracting a desired profit margin from a competitive market price. (CIMA, 2005). Required: The target costing is cost management techniques, and discuss the advantages of using this technique within firms.

1- What potential problems should be avoided in relevant-cost analysis? 2- Describe life-cycle budgeting and life-cycle costing and when companies should use these techniques. 3- Describe three alternatives of cost-plus pricing methods? 4- Why is it important to distinguish cost incurrence from locked-in cost? 5- How do companies determine target costs?

Target costing A target cost is 'a product cost estimate derived by subtracting the desired profit margin from a competitive market price. (CIMA, 2005). Required: The target costing is cost management techniques,  and discuss the advantages of using this technique within firms.

1. Why is variable costing a preferred managerial tool in profit planning? 2. What is the difference between the condensed and expanded format of contribution margin statement? 3. How is cost-volume-profit analysis different from profit planning? 4. Compare the assumptions in profit planning and cvp analysis 5. What are the four levels of learning in profit planning? 6. Present a summary of formulas/effects for each level of learning in profit planning. 7. What are the two approaches in controlling profit? 8. What are the important points to remember in preparing the breakeven point graph? The cost-volume-profit (CVP) graph?

6 Chapter 10 deals with Cost/Benefit Analysis. Cost/Benefit Analysis are usually performed by people who work in finance, such as accountants, but our textbook tells us that anyone can do a simple Cost/Benefit Analysis. There are 3 primary variables in a Cost/Benefit Analysis – fixed costs, variable costs, and benefit. Should every program or research study begin or end with a Cost/Benefit Analysis – should you do an analysis before the work is done or after the study is completed?

Contribution Margin, Cost-Volume-Profit Analysis and Break-Even Point (Overview) Fixed, Variable and Mixed Costs An appreciation of cost behavior is needed in order for management to understand and predict profitability as the costs of material, labor and other operating expenses and levels of production and sales change. It's important to review the cost behavior of fixed, variable and mixed costs before contribution margins, cost-volume-profit analysis, and break-even points. 1.   In the table below, Have-A-Seat Inc. has outlined many of the costs associated with producing office chairs. With respect to the production and sale of office chairs, classify each cost as fixed, mixed, or variable. a.  Pressure-molded plastic for chair frames   b.  Pension cost: $0.50 per employee hour on the job   c.  Insurance premiums for inventory: $2,100 per month plus $0.01 for each dollar of inventory over $2 million   d.  Property taxes: $120,000 per year for the factory building and…

1. Mastery Problem: Contribution Margin, Cost-Volume-Profit Analysis and Break-Even Point (Overview) Fixed, Variable and Mixed Costs An appreciation of cost behavior is needed in order for management to understand and predict profitability as the costs of material, labor and other operating expenses and levels of production and sales change. It's important to review the cost behavior of fixed, variable and mixed costs before contribution margins, cost-volume-profit analysis, and break-even points. 1.   In the table below, Have-A-Seat Inc. has outlined many of the costs associated with producing office chairs. With respect to the production and sale of office chairs, classify each cost as fixed, mixed, or variable. a.  Pressure-molded plastic for chair frames     b.  Pension cost: $0.50 per employee hour on the job     c.  Insurance premiums for inventory: $2,100 per month plus $0.01 for each dollar of inventory over $2 million     d.  Property taxes: $120,000 per…

Mastery Problem: Target Income and Margin of Safety Target Income and Margin of Safety At the break-even point, sales and costs are exactly equal. However, the goal of most companies is to make a profit. When a company decides that it wants to earn more than the break-even point of income, it must define the amount it thinks it will realistically make. By modifying the break-even equation, the sales required to earn a target or desired amount of profit may be computed. Complete the following: If a company makes $5 off of each unit it sells and has a target operating income of $5,000, then it must sell units. Similarly, if a company has a target operating income of $75,000 and knows that total expenses for the period will be $75,000, how much revenue must it earn to reach its target operating income? $ Units sold or revenue earned above and beyond the break-even point contributes to the margin of safety for a company. Margin of safety is a crude measure of risk, in that it serves as the…

c. Smart TVs ve Su d. Smartphones stand th oppor net pr Concepts: Apply Marketing Metrics Contribution per unit and break-even analysis are two popular and very useful metrics for marketing decision making. These analyses are essential to determine if a firm's marketing oppor- tunity will mean a financial profit or loss. As explained in the chapter, contribution per unit is the difference between the price the firm charges for a product and the variable costs. Break-even analysis that includes contribution tells marketers SW how much must be sold to break even or to earn a desired amount of profit. ansmonann Let's assume that Touch of Beirut Brands is a Los Angeles- based producer of Lebanese specialty foods and ingredients. In the past, the firm has marketed primarily through restaurant dis- tributors to small mom-and-pop Lebanese cuisine restaurants around the U.S. But recently they've developed a marketing plan to sell a combination hummus and pita slices packaged product that is…

Q-15 the learning curve concept

Estimating costs requires information • analysis, interpretation, decision-making • measurement, creation of data, negotiation • utilization, historical trends, fixed costs • projection, estimation, monitoring Cost structures are used by managers in __________. Group of answer choices planning, control, decision making activity-based costing, relative value unit method, variable cost rating estimating, forecasting, projecting allocating, averaging costs, performance testing Costs that are unique to a particular department, and would disappear if the department was abolished are known as ____. Group of answer choices indirect costs fixed costs direct costs variable As a manager you must consider _______. Group of answer choices benefits vs. costs benefits vs. overhead benefits vs. cost drivers benefits vs. time Even though fixed costs remain the constant, total costs will _______. Group of answer choices vary based on total fixed costs never vary vary based on volume always be more than…

"In target​ costing, prices determine costs rather than vice​ versa." Explain.       Question content area bottom Part 1     A. In target​ costing, managers start with a predatory price. Then they determine how much they can spend in variable and fixed costs to breakeven.​ Thus, prices essentially determine costs.   B. In target​ costing, managers start with a price that will result in breakeven. They the managers brainstorm to find ways to lower costs without raising the price to earn more profit.​ Thus, prices essentially determine costs.   C. In target​ costing, managers start with a market price. Then they try to design a product with costs low enough to be profitable at that price.​ Thus, prices essentially determine costs.   D. In target​ costing, managers start with a​ cost-plus price. Then they work backwards to determine how much their costs are for production and the markup is on the product.​ Thus, prices essentially determine costs.

View Policies A Current Attempt in Progress What is "balanced" in the balanced scorecard approach? A O The number of products produced. O The number of defects found on each product. O The amount of costs allocated to products. O The emphasis on financial and non-financial performance measurements. Save for Later Attempts: 0 of 1

Understanding the relationships in the expanded contribution margin model may be the singlemost important concept developed in managerial accounting. The model presented here provides a structure for explaining, in a consistent manner, the effect on operating income of changesin selling price, variable expenses, fixed expenses, or the volume of activity. As you study theseexamples, you will notice that four relationships are constantly interacting with one another:1. Revenue −Variable expenses 5 Contribution margin.2. Contribution margin / Revenue 5 Contribution margin ratio.3. Total contribution margin depends on the volume of activity.4. Contribution margin must cover fixed expenses before an operating income is earned.Your goals are to identify these relationships in every cost–volume–profit question and appreciatetheir interaction as a way of thinking that becomes second nature for you. Once you can visualize thisinteraction of these relationships, you are well on your way to…

Please give me correct answer with explanation of this accounting mcq

Mastery Problem: Return on Investment, margin, and turnover Return on Investment (ROI) The manager of an investment center should be evaluated based on revenues, costs, and investments. An evaluation based on net income ignores the amount of investment the investment center required. One way to measure operating profit in relation to investment is a calculation called the return on investment. One formula for calculating return on investment is: Operating income Invested Assets ROI is effective because it takes into consideration the three factors under the control of an investment center manager: revenues, costs, and investments. ROI measures the income (or return) earned on each dollar of investment. APPLY THE CONCEPTS: Calculating return on investment The divisional income statements for three divisions of the McLaren Company are shown. McLaren Company Divisional Income Statements For the Year Ending December 31, 2012   Division A Division B Division C…

Question 2 A seminar was recently attended by the Managing Director of XYZ Manufacturing Company Limited located at Sheffield. The focus of the seminar was "optimising scarce resources utility in a manufacturing setting with particular reference to linear programming". On his return to his base, he called for a meeting with the Management to share his experience from the seminar and the impact this will have on the decision by the Board to produce two major products in the years ahead. A group of external research experts had previously been commissioned and the following represents information from the research carried out by them The expected products are "Best" and "Smart" with expected costs statistics as follows: Best £ £ Smart (3kg@£50/kg) Material costs (5kg@£50/kg) 250 150 Labour costs Machinery time 30 (4 hours @£15/Hr) 60 (4 hours @£10/hr) 40 (2hours @£15/Hr) (5hours@£10/Hr) Other Processing Time 50 The applicable pricing policy is based on total cost of production plus 20%…

2. CVP analysis allows management to determine the relative profitability of a product by * Keeping fixed costs to an absolute minimum. Highlighting potential bottlenecks in the production process. Assigning costs to a product in a manner that maximizes the contribution margin. Determining the contribution margin O per unit and projected profits at various levels of production.

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A. Mastery Problem: Break-Even Point in Units and the Profit-Volume Graph CVP and the Contribution Margin Income Statement For planning and control purposes, managers have a powerful tool known as cost-volume-profit (CVP) analysis. CVP shows how revenues, expenses, and profits behave as volume changes. In CVP analysis, costs are classified according to behavior: variable or fixed. To arrive at operating income in CVP analysis, costs are classified by behavior on the income statement. This format is known as the contribution margin income statement. Complete the following table to illustrate the format. Select a or b to pick the correct decscription under the sales column Contribution Margin Income Statement Sales $ XXX (a. Less: Variable Cost or b. Less: Fixed costs) (XXX) (a. Contribution margin or b. Gross margin) $ XXX (a. Less: Variable Cost or b. Less: Fixed costs) (XXX) Operating income $ XXX   B. CVP and the Break-Even Point Review the following concepts about…

Cost-volume-profit analysis is used to make many decisions, including product pricing and controlling costs. What are the limitations of using operating leverage to predict profitability?