The manager of the manufacturing unit of a company is responsible for the costs of the manufacturingunit. The president is in the process of deciding whether to evaluate the manager of the manufacturing unitby the average cost per unit or the variable cost per unit. Quality and timely delivery would be used inconjunction with the cost measure to reward the manager.Requlred:a. What problems are associated with using the average cost per unit as a performance measure?b. What problems are associated with using the variable cost per unit as a performance measure?

Average cost per unit only rewards the manager for removing tasks or materials from the process…

Answered: a. What problems are associated with…

a. What problems are associated with using the average cost per unit as a performance measure? b. What problems are associated with using the variable cost per unit as a performance measure?

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter1: Introduction To Managerial Accounting

Section: Chapter Questions

Problem 5TIF: The following situations describe scenarios that could use managerial accounting information: a. The...

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As manager of department B in MarIeys Manufacturing, based on the costs you identified in the previous exercise for further research, how does this impact the financial performance of your department, and what might be some questions you want to ask or solutions you might propose to Marleys management?
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