Managerial Accounting

Develop and diagram an activity based cost model using the information in the case. Provide your best estimates about the cost and profitability of Wilkerson’s three product lines. What difference does your cost assignment have on reported product costs and profitability? What causes any shifts in cost and profitability?

Accounts receivable (net) increased by $500,000 during the year. This increase has what effect on cash flow?

This report has been prepared to argue the case that the company’s current costing method should be changed to the activity based costing method. This report will review; the difference between traditional based costing and activity based costing; traditional split and allocations with activity based costing; and discusses the breakeven point for Competition bikes Inc. with regards to sales units and sales dollars for both CarbonLite and Titanium bikes.

This report has been prepared to analyze the current costing method at Competition Bikes, Inc. (CBI) and provide a recommendation for improvement. To support this analysis, the differences between traditional based costing and activity based costing will be examined, along with the benefits and drawbacks for each method. A cost-volume-profit evaluation with break-even analysis for both sales units and sales dollars for the CarbonLite and Titanium bike lines will also be provided.

(B) The full production cost (per gallon) of the Polynesian Fantasy and Vanilla products as per new costing method (Louise’s suggestion) is as below:

Businesses – from manufacturing, merchandising and service industries alike – take careful considerations for their costing systems. Setting-up competitive prices in the market can be a result of proper costing methods. Misallocation of costs may lead to incorrect price estimates, continuous production of unprofitable products, and ineffective processing schedules. In this case study, we will discuss the costing methods Zauner Ornaments are currently using and upon conclusion, it will enable us to distinguish the advantages and disadvantages of each costing method.

Company operates in the Industrial Sector – Services, and Industry – Regional Airlines. According to the Standard Industrial Classification System (SIC), company belongs to the industry group 451: Air

product cost is $10.60 per unit. The addition of this new product decreases the sales expenses and fixed factory expenses of the company. The figures show that by doing this it will make the products we already make less expensive. This will be presented in Exhibit IV below.

INTRODUCTION Businesses – from manufacturing, merchandising and service industries alike – take careful consideration in the analysis of their costing systems in order to be able to set up competitive prices in the market. Misallocation of costs may lead to incorrect price estimates, continuous production of unprofitable products, and ineffective processing schedules. In this case study, we will discuss the costing methods which Zauner Ornaments have used or is currently using and, in conclusion, be able to distinguish the advantages and disadvantages of each costing method. CASE CONTEXT The case seeks to assist Zauner’s comptroller, Yu Chia-yi, in determining the best costing method for their overhead costs. In addition we also aim to

COGS (Cost of Goods Sold) is an “inventoriable cost” ( recorded in the Balance Sheet as inventory and expensed (Income Statement) when goods are sold

Products Inc. manufactures furniture and is organized into three large divisions: bedroom, living room, and dining room furniture. The following information presents operating revenues, operating incomes and invested assets of the company over the last three years. (all figures in 000s)

Next, I continued to focus of the pricing point. I lowered the price of the X5 to $220, the X6 at $320, and the X7 at $150. The X5 and X6 has reach full saturation at 100%. The X7 is in its growth phase during this year. The X7 profitability is at 21%, an increase of 31%. The cumulative profit score is 892,053,874.

Pittman Company is a small but growing manufacturer of telecommunications equipment. The company has no sales force of its own; rather, it relies completely on independent sales agents to market its products. These agents are paid a commission of 15% of selling price for all item sold.

Editors’ Note: This article is an updated synthesis of in-depth explorations contained in Target Costing and Value Engineering, by Robin Cooper and Regine Slagmulder (Portland, Oregon: Productivity Press, 1997). Part two of the series discusses product-level target costing; part three, to be featured in an upcoming issue, will address component-level target costing. tomers. Consequently, the objective of product-level target costing is to increase the allowable cost of the product to a level that can reasonably be expected to be achievable, given the capabilities of the firm and its suppliers (see Exhibit 1).

Forced planning. Target costing ensures proper planning well ahead of actual production and marketing. It considered important in meeting all of the goals, as indicated in 2(c). The results show that the most important benefit of target costing is to assists firms in making the trade-offs between cost and quality and functionality and it helps launch products that improve on previous generations by having reduced prices or improve quality and functionality