14. If Material B is used regularly by Lloyd Industries Ltd, and if units of B are required for this job, they would need to be replaced to meet other production demands. What is the relevant cost for this material B? Lloyd Industries Ltd. has been approached by a customer who would like a special job to be done for him and is willing to pay $60,000 for it. The job would require the following materials. Material Total units required Replacement cost S/unit Units Book value of Realizable already in stock units in stock value $/unit $/unit A 1000 16.00 1000 1000 600 12.00 12.50 15.00 700 13.00 12.50 14.00 200 200 14.00 16.00 19.00 a. $6 000 b. $9 000 С. $15 000 d. $11 000 15. In making a short-term special decision, which of the following is MOST important? a. Use a conventional absorption costing method b. Focus on the total cost C. Separate variable and fixed costs d. Discount cash flow to their present values
14. If Material B is used regularly by Lloyd Industries Ltd, and if units of B are required for this job, they would need to be replaced to meet other production demands. What is the relevant cost for this material B? Lloyd Industries Ltd. has been approached by a customer who would like a special job to be done for him and is willing to pay $60,000 for it. The job would require the following materials. Material Total units required Replacement cost S/unit Units Book value of Realizable already in stock units in stock value $/unit $/unit A 1000 16.00 1000 1000 600 12.00 12.50 15.00 700 13.00 12.50 14.00 200 200 14.00 16.00 19.00 a. $6 000 b. $9 000 С. $15 000 d. $11 000 15. In making a short-term special decision, which of the following is MOST important? a. Use a conventional absorption costing method b. Focus on the total cost C. Separate variable and fixed costs d. Discount cash flow to their present values
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter5: Product And Service Costing: Job-order System
Section: Chapter Questions
Problem 22E: CleanCom Company specializes in cleaning commercial buildings and construction sites. Each building...
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