a) Classify each cost element as either fixed, variable, or mixed
Q: Distinguish between Period cost and Product cost? Give two examples of each cos
A: Classification of costs on the basis of functions:- 1. Product Cost 2. Period Cost
Q: Define the following concepts: a)Prime cost b) Non production cost
A: All costs incurred are categorised into production and non production cost on the basis of the…
Q: Explain difference between prime costs and conversion costs.
A: Prime cost: It is the cost which is incurred for manufacturing a product. It includes direct…
Q: Distinguish between escapable and inescapable costs. Give an example of each.
A:
Q: Understand thedifferences between directand indirect costs
A: Cost: It refers to the economic value incurred by an organization for manufacturing a product or…
Q: Distinguish between two methods of allocating common costs.
A: Cost Allocation Method: The cost allocation method is the method by which the costs to be assigned…
Q: costs and are allocated based on
A: Fixed costs allocated = 25% * Total costs 25% * $48000 = $12000
Q: Assign costs to unitsusing the weighted-averagemethod.
A: Cost: It refers to the economic value incurred by an organization for manufacturing a product or…
Q: From the following data find (A) material cost, (B) price cost, (C) direct cost,
A: "Hey, since there are multiple questions posted, we will answer the first question. If you want any…
Q: Label each of the following statements as either true (“T”) or false (“F”). Relevant costs are also…
A: Relevant costs: These costs can be defined as the costs that can be avoided if we choose over option…
Q: Distinguish betweenproduct costs and periodcosts and give examplesof each.
A: Product cost: The product cost relates to the manufacturing costs such as direct material, direct…
Q: Giving examples, distinguish between Direct costs and indirect costs
A: Direct Costs are the costs that can be directly traced with the goods produced. It generally…
Q: Define the following concepts: a) Absorption costing- b) Cost behavour-
A: Costing - Absorption costing is the costing also known as Full Costing. Cost Behavior - Cost…
Q: Distinguish between a traceable cost and a common cost. Give several examples of each.
A: Fixed Expense: It is the expense incurred by a company not related to the volume of output…
Q: Question 1: Differentiate between standard cost and estimated cost.
A: Since you have asked multiple question, we will solve the first question for you. If you want any…
Q: Describe variable costs and fixed costs and give an example of each.
A: Cost Accounting: It is the process of collecting, recording, analyzing the cost, summarizing cost,…
Q: Define the following concepts: a)Prime cost b) Non production cost c)Total cost
A: The term cost refers to the monetary value of expenditure for raw materials, technology, supplies,…
Q: Giving examples, distinguish between Variable cost and Fixed costs
A: Introduction: Costs: Costs are of two types: 1 ) Fixed costs 2 ) variable costs
Q: ost classifications used for assigning costs to cost objects include: Multiple Choice Variable cost…
A: Cost Classification Determining the cost in the organisation is one of the important part in the…
Q: What two assumptions are frequently made when estimating a cost function?
A: Cost Function:Cost function represents the basic change that occurs in the total cost due to the…
Q: Distinguish between ( a ) a variable cost, ( b ) a fixed cost, and ( c ) a mixed cost.
A: Variable Cost: The cost which is not fixed is called as variable cost. This cost is directly…
Q: Explain the major reasons for allocating costs.
A: The entity allocates its cost by using a different measure. The cost that is allocated is common and…
Q: Distinguish between indirect costs and direct costs.
A: Direct Costs and Indirect Costs are two important costs. Direct costs are those costs which are…
Q: How is it possible for a cost that is traceable to a segment to become a common cost if thesegment…
A: Fixed Cost: It is a cost which is constant in the short run, it is not related to any change in the…
Q: Define Full-cost method.
A:
Q: What are the three primary cost flow assumptions? How does the specific identification method differ…
A: Inventory: Inventory refers to the stock of goods purchased, utilized and maintained by the company…
Q: Briefly define total cost and marginal cost.
A: Cost: The amount paid to purchase the asset, install it, and put it into operations, is referred to…
Q: Explain how the accounting definition of an asset is related to the choice between absorption and…
A: Absorption costing: Absorption costing is compulsory under Generally Accepted Accounting…
Q: Give an example of cost which is a part of unavoidable cost.
A: Unavoidable fixed costs are fixed costs that cannot be avoided by discontinuing a product line or…
Q: Name three factors that will affect the classification of a cost as direct or indirect?
A: Cost: Cost refers to the expenses incurred by the business to earn revenue from sales, in other…
Q: Can you label revenue, loss, total costs, dollars, variable cost, and fixed cost on the provided…
A: Cost Volume Profit Analysis (CVP Analysis): This analysis is helpful in determining how any type of…
Q: Identify each of these costs as fixed, variable, or mixed.
A:
Q: Describe the difference between prime costs and conversion costs?
A: Solution:- Difference between prime costs and conversion costs as follows under:-
Q: List three methods to measure cost behavior.
A:
Q: Instructions a. Define the terms variable costs, fixed costs, and mixed costs. b. Classify each cost…
A: Answer a) VARIABLE COST:- A variable cost is an expense that rises or falls in direct proportion to…
Q: Describe three criteria for evaluating cost functions and choosing cost drivers.
A: Cost Function: Cost function represents the basic change comes in the total cost due to the change…
Q: Distinguish between fixed cost and variable cost.
A: Fixed Costs: These are the costs that remain constant in total dollar amount irrespective to the…
Q: Define standard costs and explain how standard cost information is useful formanagement by…
A: Standard costs: These are the costs which a company determines as a standard to attain its…
Q: Define the following terms: differential cost, sunk cost, and opportunity cost.
A: Differential cost: Differential cost is the change in total cost due to increase or decrease in…
Q: Distinguish between traceable and common fixed costs.
A: Fixed costs are referred to as the costs that do not change with a change in the level of the…
Q: Name four approaches to estimating a cost function.
A: Cost Function:Cost function represents the basic change comes in the total cost due to the change in…
Q: (i) A cost that can be traced to a cost object is known as A. A fixed cost B. A variable cost C. A…
A: As posted multiple questions we are answering only first question kindly repost the unanswered…
Q: What does it mean that a cost is a direct, product, and variable cost?
A: The cost represents the value incurred by the corporation in making the product ready to sell in the…
a) Classify each cost element as either fixed, variable, or mixed
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- Ottis, Inc., uses 640,000 plastic housing units each year in its production of paper shredders. The cost of placing an order is 30. The cost of holding one unit of inventory for one year is 15.00. Currently, Ottis places 160 orders of 4,000 plastic housing units per year. Required: 1. Compute the economic order quantity. 2. Compute the ordering, carrying, and total costs for the EOQ. 3. How much money does using the EOQ policy save the company over the policy of purchasing 4,000 plastic housing units per order?Gent Designs requires three units of part A for every unit of Al that it produces. Currently, part A is made by Gent, with these per-unit costs in a month when 4.000 units were produced: Variable manufacturing overhead is applied at $1.00 per unit. The other $0.30 of overhead consists of allocated fixed costs. Gent will need 6,000 units of part A for the next years production. Cory Corporation has offered to supply 6,000 units of part A at a price of $7.00 per unit. It Gent accepts the offer, all of the variable costs and $1,200 of the fixed costs will be avoided. Should Gent Designs accept the offer from Cory Corporation?Deuce Sporting Goods manufactures a high-end model tennis racket. The company’s forecasted income statement for the year, before any special orders, is as follows: Fixed costs included in the forecasted income statement are $400,000 in manufacturing cost of goods sold and $200,000 in selling expenses. A new client placed a special order with Deuce, offering to buy 1,000 tennis rackets for $100.00 each. The company will incur no additional selling expenses if it accepts the special order. Assuming that Deuce has sufficient capacity to manufacture 1,000 more tennis rackets, by what amount would differential income increase (decrease) as a result of accepting the special order? (Hint: First compute the variable cost per unit relevant to this decision.)
- Marcotti Cupcakes bakes and sells a basic cupcake for $1.25. The cost of producing 600,000 cupcakes in the prior year was: At the start of the current year, Marcotti received a special order for 15,000 cupcakes to be sold for $1.10 per cupcake. To complete the order, the company must incur an additional $700 in total fixed costs to lease a special machine that will stamp the cupcakes with the customers logo. This order will not affect any of Marcottis other operations and it has excess capacity to fulfill the contract. Should the company accept the special order? (Show your work.)Zippy Inc. manufactures a fuel additive, Surge, which has a stable selling price of 44 per drum. The company has been producing and selling 80,000 drums per month. In connection with your examination of Zippys financial statements for the year ended September 30, management has asked you to review some computations made by Zippys cost accountant. Your working papers disclose the following about the companys operations: Standard costs per drum of product manufactured: Materials: Costs and expenses during September: Chemicals: 645,000 gallons purchased at a cost of 1,140,000; 600,000 gallons used. Empty drums: 94,000 purchased at a cost of 94,000; 80,000 drums used. Direct labor: 81,000 hours worked at a cost of 816,480. Factory overhead: 768,000. Required: Calculate the following for September, using the formulas on pages 421422 and 424 (Round unit costs to the nearest whole cent and compute the materials variances for both Surge and for the drums.): 1. Materials quantity variance. 2. Materials purchase price variance. 3. Labor efficiency variance. 4. Labor rate variance.Zena Technology sells arc computer printers for $55 per unit. Unit product costs are: A special order to purchase 15,000 arc printers has recently been received from another company and Zena has idle capacity to fill the order. Zena will incur an additional $2 per printer for additional labor costs due to a slight modification the buyer wants made to the original product. One-third of the manufacturing overhead costs is fixed and will be incurred no matter how many units are produced. When negotiating the price, what is the minimum selling price that Zena should accept for this special order?
- Cinnamon Depot bakes and sells cinnamon rolls for $1.75 each. The cost of producing 500,000 rolls in the prior year was: At the start of the current year, Cinnamon Depot received a special order for 18,000 rolls to be sold for $1.50 per roll. The company estimates it will incur an additional $1,000 in total fixed costs in order to lease a special machine that forms the rolls in the shape of a heart per the customers request. This order will not affect any of its other operations. Should the company accept the special order? (Show your work.)Markson and Sons leases a copy machine with terms that include a fixed fee each month plus acharge for each copy made. Markson made 9,000 copies and paid a total of $480 in January. In April, they paid $320 for 5,000 copies. What is the variable cost per copy if Markson uses the high-low method to analyze costs?Self-Construction Olson Machine Company manufactures small and large milling machines. Selling prices of these machines range from 35,000 to 200,000. During the 5-month period from August 1, 2019, through December 31, 2019, Olson manufactured a milling machine for its own use. This machine was built as part of the regular production activities. The project required a large amount of time front planning and supervisory personnel, as well as that of some of the companys officers, because it was a more sophisticated type of machine than the regular production models. Throughout the 5-month period, Olson charged all costs directly associated with the construction of the machine to a special account entitled Asset Construction Account. An analysis of the charges to this account as of December 31, 2019, follows: Olson allocates factory overhead to normal production as a percent of direct labor dollars as follows: Olson uses a flat rate of 40% of direct labor dollars to allocate general and administrative overhead. During the machine testing period, a cutter head malfunctioned and did extensive damage to the machine table and one cutter housing. This damage was not anticipated and was the result of an error in the assembly operation. Although no additional raw materials were needed to make the machine operational after the accident, the following labor for rework was required: Olson has included all these labor charges in the asset construction account. In addition, it included in the account the repairs and maintenance charges of 1,340 that it incurred as a result of the malfunction. Required: 1. Compute, consistent with GAAP and common practice, the amount that Olson should capitalize for the milling machine as of December 31, 2019, when it declares the machine operational. 2. Next Level Identify the costs you included in Requirement 1 for which there are acceptable alternative procedures. Describe the alternative procedure(s) in each case.
- Bethany Company has just completed the first month of producing a new product but has not yet shipped any of this product. The product incurred variable manufacturing costs of 5,000,000, fixed manufacturing costs of 2,000,000, variable marketing costs of 1,000,000, and fixed marketing costs of 3,000,000. Under the variable costing concept, the inventory value of the new product would be: a. 5,000,000. b. 6,000,000. c. 8,000,000. d. 11,000,000.Cashion Company produces chemical mixtures for veterinary pharmaceutical companies. Its factory has four mixing lines that mix various powdered chemicals together according to specified formulas. Each line can produce up to 5,000 barrels per year. Each line has one supervisor who is paid 34,000 per year. Depreciation on equipment averages 16,000 per year. Direct materials and power cost about 4.50 per unit. Required: 1. Prepare a graph for each of these three costs: equipment depreciation, supervisors wages, and direct materials and power. Use the vertical axis for cost and the horizontal axis for units (barrels). Assume that sales range from 0 to 20,000 units. 2. Assume that the normal operating range for the company is 16,000 to 19,000 units per year. How would you classify each of the three types of cost?Melchar Company uses 78,125 pounds of oats each year. The cost of placing an order is 18, and the carrying cost for one pound of oats is 0.45. Required: 1. Compute the economic order quantity for oats. 2. Compute the carrying and ordering costs for the EOQ.