A wholesaler of custom-built air-conditioning units for commercial buildings gathered the following monthly data relating to unitsshipped and total shipping expense:Units shippedTotal shipping expense$2,000$2,500$1,900$2,200$2,500$3,030$1,950Month2.JanuaryFebruaryMarch3.AprilMayJune4.7.July3Using the high-low method estimate the cost formula for shipping expenses, calculate the variable shipping expense as well as fixedshipping expense per unit.%24(All answers are whole numbers - unless specified otherwise. You should NOT include the $ sign or a comma. E.g., you should type1000 for one thousand. Negative numbers should be added with a minus sign, e.g, -1000 for a decrease or loss of one thousand.)Variable shipping expense = $per unit.Fixed shipping expense = $per unit.

The high low method of estimating costs dictates that the difference between the cost at the highest…

Answered: A wholesaler of custom-built…

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter2: Basic Cost Management Concepts

Section: Chapter Questions

Problem 21E: Ellerson Company provided the following information for the last calendar year: During the year,...

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Ellerson Company provided the following information for the last calendar year: During the year, direct materials purchases amounted to 278,000, direct labor cost was 189,000, and overhead cost was 523,000. During the year, 100,000 units were completed. Refer to Exercise 2.21. Last calendar year, Ellerson recognized revenue of 1,312,000 and had selling and administrative expenses of 204,600. Required: 1. What is the cost of goods sold for last year? 2. Prepare an income statement for Ellerson for last year.
Sterling Corporation has an EOQ of 5,000 units. The company uses an average of 500 units per day. An order to replenish the part requires a lead time of five days. Required: 1. Calculate the reorder point, using Equation 20.3. 2. Graphically display the reorder point, where the vertical axis is inventory (units) and the horizontal axis is time (days). Show two replenishments, beginning at time zero with the economic order quantity in inventory. 3. What if the average usage per day of the part is 500 units but a daily maximum usage of 575 units is possible? What is the reorder point when this demand uncertainty exists?
Orman Company produces neon-colored covers for tablets (e.g., iPads). For last year, Orman reported the following: Last year, Orman produced 89,000 units and sold 90,500 units at 10.50 per unit. Required: 1. Prepare a statement of cost of goods manufactured. 2. Prepare an absorption-costing income statement.
Total Pops data show the following information: New machinery will be added in April. This machine will reduce the labor required per unit and increase the labor rate for those employees qualified to operate the machinery. Finished goods inventory is required to be 20% of the next months requirements. Direct material requires 2 pounds per unit at a cost of $3 per pound. The ending inventory required for direct materials is 15% of the next months needs. In January, the beginning inventory is 3,000 units of finished goods and 4,470 pounds of material. Prepare a production budget, direct materials budget, and direct labor budget for the first quarter of the year.
Ellerson Company provided the following information for the last calendar year: During the year, direct materials purchases amounted to 278,000, direct labor cost was 189,000, and overhead cost was 523,000. During the year, 100,000 units were completed. Required: 1. Calculate the total cost of direct materials used in production. 2. Calculate the cost of goods manufactured. Calculate the unit manufacturing cost. 3. Of the unit manufacturing cost calculated in Requirement 2, 2.70 is direct materials and 5.30 is overhead. What is the prime cost per unit? Conversion cost per unit?
Total and Unit Product Cost Martinez Manufacturing Inc. showed the following costs for last month: Last month, 4,000 units were produced and sold. Required: 1. Classify each of the costs as product cost or period cost. 2. What is the total product cost for last month? 3. What is the unit product cost for last month?
Click the Chart sheet tab. On the screen is a column chart showing ending inventory costs. During a deflationary period, which bar (A, B, or C) represents FIFO costing, which represents LIFO costing, and which represents weighted average? Explain your reasoning. On January 4 following year-end, Rio Enterprises received a shipment of 60 units of product costing 580 each. These units had been ordered by Del in December and had been shipped to him on December 27. They were shipped FOB shipping point. Revise the FIFOLIFO3 worksheet to include this shipment. Preview the printout to make sure that the worksheet will print neatly on one page, and then print the worksheet. Save the completed file as FIFOLIFOT. Using the FIFOLIFO3 file, prepare a 3-D bar (stacked) chart showing the cost of goods sold and ending inventory under each of the four inventory cost flow assumptions. No Chart Data Table is needed. Use the values in the Calculations Section of the worksheet for your chart. Enter your name somewhere on the chart. Save the file again as FIFOLIFO3. Print the chart.
The adjusted trial balance for Appleton Appliances, Ltd. on June 30, the end of its first month of operation, is as follows: The general ledger reveals the following additional data: a. There were no beginning inventories. b. Materials purchases during the period were 23,000. c. Direct labor cost was 18,500. d. Factory overhead costs were as follows: Required: 1. Prepare a statement of cost of goods manufactured for June. 2. Prepare an income statement for June. (Hint: Check to be sure that your figure for Cost of Goods Sold equals the amount given in the trial balance.) 3. Prepare a balance sheet as of June 30. (Hint: Do not forget Retained Earnings.)
Zabeer Company is a large retailer of custom-built air conditioning units for commercial buildings. The company assembled the information shown below for the quarter ended March 31:Total sales revenue Tk.6,00,000Selling price per unit Tk.450 Variable selling expense per unit Tk.45Variable administrative selling expense per unit Tk.30Total fixed selling expense Tk.170,000Total fixed administrative expense Tk.130,000Merchandise inventory, opening balance Tk.60,000Merchandise inventory, ending balance Tk.1,10,000Merchandise purchase Tk.2,40,000Required: i. Prepare a traditional format income statement for the quarter ended March 31. ii. Prepare a contribution format income statement for the quarter ended March 31.
Jerry Thomas is the manger for the storeroom for Classic Manufacturing. He was asked to estimate the future monthly purchase costs for part number 782. Jerry collected the cost and quantity data for the past nine months as provided below. Month Purchase cost Quantity Purchased January $ 12,925 2,762 February $ 13,250 2,862 March $ 17,903 4,212 April $ 16,075 3,818 May $ 13,375 2,966 June $ 14,064 3,447 July $ 15,550 3,685 August $ 10,483 2,356 September $ 15,200 3,636 Estimated monthly purchases of part 782 for the following three months are: October 3,590 November 3,960 December 3,290 Required: (a) Use…
For the current year Furniture Company incurred the following: Month Delivery Costs # of Deliveries April $54,180 225 May 51,750 250 June 72,720 360 July 40,500 135 August 58,500 180 September 49,500 90 October 55,800 315 November 45,495 110 December 41,265 160 Using the high-low method to analyze mixed costs and the data above, what is the estimate of Total Delivery Costs at 450 deliveries? Round intermediate calculations to two decimals, round your solution to dollars.
The controller of Crane Production has collected the following monthly cost data for analyzing the behavior of electricity costs. TotalElectricity Costs TotalMachine Hours January $2,620 230 February 3,010 370 March 3,590 460 April 4,770 695 May 3,240 400 June 4,850 790 July 4,100 620 August 3,850 550 September 5,110 680 October 4,300 620 November 3,310 370 December 9,000 810 What electricity cost does the cost equation estimate for a level of activity of 460 machine hours? Electricity cost $enter the electricity cost in dollars By what amount does this differ from March’s observed cost for 460 machine hours? Amount differ $enter a dollar amount

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