Chen Company's Small Motor Division manufactures a number of small motors used in household and office appliances. The Household Division of Chen then assembles and packages such items as blenders and juicers. Both divisions are free to buy and sell any of their components internally or externally. The following costs relate to small motor LN233 on a per unit basis. Fixed cost per unit $4.65 Variable cost per unit $11.20 Selling price per unit $35.10 Assuming that the Small Motor Division has excess capacity, compute the minimum acceptable price for the transfer of small motor LN233 to the Household Division. (Round answer to 2 decimal places, e.g. 10.50.) Minimum transfer price per unit $1 Assuming that the Small Motor Division does not have excess capacity, compute the minimum acceptable price for the transfer of the small motor to the Household Division. (Round answer to 2 decimal places, e.g. 10.50.) Minimum transfer price $4

Chen Company's Small Motor Division manufactures a number of small motors used in household and office appliances. The Household Division of Chen then assembles and packages such items as blenders and juicers. Both divisions are free to buy and sell any of their components internally or externally. The following costs relate to small motor LN233 on a per unit basis. Fixed cost per unit $4.65 Variable cost per unit $11.20 Selling price per unit $35.10 Assuming that the Small Motor Division has excess capacity, compute the minimum acceptable price for the transfer of small motor LN233 to the Household Division. (Round answer to 2 decimal places, e.g. 10.50.) Minimum transfer price per unit $1 Assuming that the Small Motor Division does not have excess capacity, compute the minimum acceptable price for the transfer of the small motor to the Household Division. (Round answer to 2 decimal places, e.g. 10.50.) Minimum transfer price $4

Financial & Managerial Accounting

14th Edition

ISBN:9781337119207

Author:Carl Warren, James M. Reeve, Jonathan Duchac

Publisher:Carl Warren, James M. Reeve, Jonathan Duchac

Chapter18: Activity-Based Costing

Section: Chapter Questions

Problem 18.3TIF: Communication The controller of New Wave Sounds Inc. prepared the following product profitability...

See similar textbooks

Similar questions

5-17 Coast Hierarchy; Teledor Inc. manufactures boomboxes (music system with radio, MP3, and compact disc player) for a different well known companies. The boomboxes differ significantly in their complexity and the batch sizes in which they are manufactured. The following cost were in incurred in 2018. Indirect Manufacturing Labour Cost such as supervision that supports direct manufacturing labour, $1,500,000. Procurement Cost of placing purchased orders, receiving materials, and paying suppliers that are related to the number of purchased orders placed, $800,000. Cost of indirect Materials $450,000. Cost incurred to set up machines each time a different product needs to be manufactured, $900,000. Designing processes, drawing process charts, making engineering process for products $900,000. Machine related overhead cost such as depreciation, maintenance, production, engineering, $1,200,000. these resources are related to the activity of running the machines. Plant management, plant…
Appliance Apps has the following costs associated with its production and sale of devices that allow appliances to receive commands from cell phones. Beginning Inventory 0Units Produced 24,000Units Sold 19,200Selling Price per Unit $146Variable Sales and Administration Expenses $4Fixed Sales and Administration Expenses $936,000Direct Material Cost per Unit $26Direct Labor Cost per Unit $10Variable Manufacturing Overhead Cost per Unit $2Fixed Manufacturing Overhead Cost per Month $938,400 -Prepare an income statement under the absorption method. If an amount box does not require an entry, leave it blank. -Prepare an income statement under the variable costing method. If an amount box does not require an entry, leave it blank. -Prepare a reconciliation between the two statements.
Question No.4 Feri Corporation makes a single product. A fire resistant commercial filling cabinet that it sells to office furniture distributors. The company has simple ABC system that it use for internal decision making. The company has two overheads departments whose costs are listed below; Manufacturing Over head $ 500,000 Selling & Admin overhead $ 300,000 Total overhead Costs $ 800,000 The company ABC’s system has the following activity cost pools and activity measures; Activity Costs Pool Activity Measures Assembling Units……………………… Number of Units Processing Order ……………………… Number of Orders…
Don't use chatgpt, I will 5 upvotes Sheridan Corporation manufactures a single product. Monthly production costs incurred in the manufacturing process are shown below for the production of 3,600 units.
eBook Print Item Appliance Apps has the following costs associated with its production and sale of devices that allow appliances to receive commands from cell phones. Beginning Inventory 0 Units Produced 24,000 Units Sold 19,200 Selling Price per Unit $146 Variable Sales and Administration Expenses $5 Fixed Sales and Administration Expenses $931,200 Direct Material Cost per Unit $25 Direct Labor Cost per Unit $11 Variable Manufacturing Overhead Cost per Unit $4 Fixed Manufacturing Overhead Cost per Month $940,800 Prepare an income statement under the absorption method. If an amount box does not require an entry, leave it blank.
Communication The controller of New Wave Sounds Inc. prepared the following product profitability report for management, using activity-based costing methods for allocating both the factory overhead and the marketing expenses. As such, the controller has confidence in the accuracy of this report. Home Theater Speakers Wireless Speakers Wireless Headphones Total Sales 1,500,000 1,200,000 900,000 3,600,000 Cost of goods sold 1,050,000 720,000 810,000 2,580,000 Gross profit 450,000 480,000 90,000 1,020,000 Marketing expenses 600,000 120,000 72,000 792,000 Income from operations (150,000) 360,000 18,000 228,000 In addition, the controller interviewed the vice president of marketing, who provided the following insight into the company's three products: The home theater speakers are an older product that is highly recognized in the marketplace. The wireless speakers are a new product that was just recently bunched. The wireless headphones are a new technology that has no competition in the marketplace, and it is hoped that they will become an important future addition to the companys product portfolio. Initial indications are that the product is well received by customers. The controller believes that the manufacturing costs for all three products are in line with expectations. Based on the information provided: 1. Calculate the ratio of gross profit to sales and the ratio of income from operations to sales for each product. 2. Write a brief (one page) memo using the product profitability report and the calculations in (1) to make recommendations to management with respect to strategies for the three products.
Please help with the question number 4,5, and 6. Thank you Gigabyte, Inc. manufactures three products for the computer industry: Gismos (product G): annual sales, 8,000 units Thingamajigs (product T): annual sales, 15,000 units Whatchamacallits (product W): annual sales, 4,000 units The company uses a traditional, volume-based product-costing system with manufacturing over-head applied on the basis of direct-labor dollars. The product costs have been computed as follows: Product G Product T Product W Raw material ..........................$ 35.00 $52.50 $17.50 Direct labor 16(.8 hr.at $20) 12(.6 hr at $20) 8(.4 hr at $20) Manufacturing overhead* ......140.00 105.00 70.00 Total product cost ..................$191.00 $169.50 $95.50 *Calculation of predetermined overhead rate: Manufacturing overhead budget: Machine…
Appliance Apps has the following costs associated with its production and sale of devices that allow appliances to receive commands from cell phones. Beginning Inventory 0 Units Produced 24,000 Units Sold 19,200 Selling Price per Unit $145 Variable Sales and Administration Expenses $4 Fixed Sales and Administration Expenses $936,000 Direct Material Cost per Unit $25 Direct Labor Cost per Unit $10 Variable Manufacturing Overhead Cost per Unit $3 Fixed Manufacturing Overhead Cost per Month $940,800 Question Content Area Prepare an income statement under the absorption method. If an amount box does not require an entry, leave it blank. Appliance AppsIncome Statement: Absorption $- Select - Cost of Goods Sold: $- Select - - Select - $- Select - - Select - Total Cost of Goods Sold fill in the blank c283fffd202c01d_11 $- Select - Sales and Administrative Expenses: Variable $fill in the blank…
Make or Buy Decision: Zee-Drive Ltd. is a computer manufacturer. One of the items they make is monitors. Zee-Drive has the opportunity to purchase 19,000 monitors from an outside supplier for $211 per unit. One of the company's cost-accounting interns prepared the following schedule of Zee-Drive's cost to produce 19,000 monitors: Total cost of producing 19,000 monitors Unit cost Direct materials $ 2,204,000 $ 116 Direct labor 1,330,000 70 Variable factory overhead 665,000 35 Fixed manufacturing overhead 570,000 30 Fixed non-manufacturing overhead 722,000 38 $ 5,491,000 $ 289 You are asked to look over the intern's estimate before the information is shared with members of management who will decide to continue to make the monitors or buy them. The company's controller believes that the estimate may be incorrect because it includes costs that are not relevant. If Zee-Drive buys the monitors, the direct labor force currently employed in producing the…
Business Systems, Inc., sells computer hardware to end consumers. The CX30 is sold as a "bundle", which includes three hardware products: a personal computer (PC) tower, a 26-inch monitor, and a color laser printer. Each of these products is made in a separate manufacturing division of Business Systems and can be purchased individually as well as in a bundle. Business Systems sells roughly equal quantities of the three products. The individual selling prices and per unit costs are as follows: Read the requirements2. Requirement 1. Allocate the revenue from the computer bundle purchase to each of the hardware products using the stand-alone method based on the individual selling price per unit. (Enter the allocation proportion as a decimal rounded to five decimal places. Round the revenue allocated to the nearest whole dollar.) Computer component Allocation Proportion Revenue Allocated PC tower Monitor Color laser printer…
Question, Feri Corporation makes a single product. A fire resistant commercial filling cabinet that it sells to office furniture distributors. The company has simple ABC system that it use for internal decision making. The company has two overheads departments whose costs are listed below; Manufacturing Over head $ 500,000 Selling & Admin overhead $ 300,000 Total overhead Costs $ 800,000 The company ABC’s system has the following activity cost pools and activity measures; Activity Costs Pool Activity Measures Assembling Units……………………… Number of Units Processing Order ……………………… Number of Orders…
Appliance Apps has the following costs associated with its production and sale of devices that allow appliances to receive commands from cell phones. Beginning Inventory 0 Units Produced 25,000 Units Sold 20,000 Selling Price per Unit $146 Variable Sales and Administration Expenses $4 Fixed Sales and Administration Expenses $970,000 Direct Material Cost per Unit $25 Direct Labor Cost per Unit $11 Variable Manufacturing Overhead Cost per Unit $2 Fixed Manufacturing Overhead Cost per Month $977,500 Question Content Area Prepare an income statement under the absorption method. If an amount box does not require an entry, leave it blank. blankAppliance AppsIncome Statement: Absorption blank $Sales Cost of Goods Sold: $Beginning Inventory Cost of Goods Manufactured $Cost of Goods Available for Sale Ending Inventory Total Cost of Goods Sold fill in the blank 07321b055fbf02d_11 $Gross Profit Sales and…