Dairyplus processes organic milk into plain yogurt. Dairyplus sells plain yogurt to hospitals, nursing homes, and restaurants in bulk, one-gallon containers. Each batch, processed at a cost of $890, yields 540 gallons of plain yogurt. The company sells the one-gallon tubs for $7.00 each and spends $0.16 for each plastic tub. Dairyplus has recently begun to reconsider its strategy. Management wonders if it would be more profitable to sell individual-sized portions of fruited organic yogurt at local food stores. Dairyplus could further process each batch of plain yogurt into
Q: Harris Company manufactures and sells a single product. A partially completed schedule of the…
A: MARGINAL COSTING INCOME STATEMENTMarginal Costing Income Statement is one of the Important Cost…
Q: During 2019 and 2020, Faulkner Manufacturing used the sum-of-the-years’-digits (SYD) method of…
A: Depreciation refers to the decline in the value of the asset which takes place due to daily…
Q: On August 1, a $30,000, 6%, 3-year installment note payable is issued by Tart Company. The note…
A: Notes payable are written agreements in which one party agrees to pay the other party a certain…
Q: Diego Company manufactures one product that is sold for $76 per unit in two geographic regions-East…
A: Fixed expenses are those expenses which remain same irrespective of change (increase or decrease) in…
Q: Question 2 The following monthly data in contribution format are available for the Ross Company and…
A: MARGINAL COSTING INCOME STATEMENTMarginal Costing Income Statement is one of the Important Cost…
Q: Lopez, Cruz, and Perez are partners and share net income and loss in a 7:3:1 ratio (in ratio form:…
A: Partnerships provide benefits such as collaboration, flexibility, and the capacity to pool resources…
Q: onnect Portion) i The preliminary 2024 income statement of Alexian Systems, Incorporated, is…
A: An income statement stands for the statement that shows profits and loss of the firm, its revenue…
Q: Lear, Inc. has $1,000,000 in current assets, $430,000 of which are considered permanent current…
A: It is the income earned by an entity after incurring all the expenses. It is the net revenue left…
Q: chedule of Cash Collections of Accounts Receivable fficeMart Inc. has "cash and carry" customers and…
A: Lets understand the basics.Management prepare budget in order to estimate future profit and loss…
Q: Question 6 Celtic Corporation's management attempts to track the time it takes to process orders.…
A: Throughput time is the time taken to run the process from start to end for production of particular…
Q: The Petty Cash Box has 3 vouchers in it (one for taxi fare in the amount of $25, one for courier…
A: Omission of an expense or income results in an error which ultimately results in financial impact on…
Q: Each of the following independent events requires a year-end adjusting entry. Show how each event…
A: The journal entries are prepared to record the transactions on regular basis. The adjustment entries…
Q: Computing Free Cash Flows to the Firm (FCFF) Home Depot reports for the following for the fiscal…
A: Free cash flow is the difference between net operating profit and capital expenditures. Capital…
Q: Crane's sells two products, a pepper relish with a selling price of $5.16 and a variable cost per…
A: Breakeven is the point at which an entity is in a situation of no profit and no loss. It is the…
Q: E7-5 Calculating Cost of Ending Inventory and Cost of Goods Sold under Periodic FIFO and Weighted…
A: Weighted Average Method is one of the methods of inventory valuation in which it is assumed that…
Q: Dixie Co. Budgeting Income Statement Sales Cost of Goods Sold Gross Profit Selling & Admin Operating…
A: Income statement is a financial statement that shows profitability, total revenue and total…
Q: On January 26, Nyree Co. borrowed cash from Conrad Bank by Issuing a 90-day note with a face amount…
A: Notes are issued to borrow funds. It is a promise by the borrower to repay the funds borrowed on…
Q: On April 1, 2024, Western Communications, Incorporated, issued 12% bonds, dated March 1, 2024, with…
A: Bonds: Bonds are long-term promissory notes that are issued by a company while borrowing money from…
Q: in each of the following independent situations, indicate taxable distribution and Accumulated…
A: Return on capital refers to the concept of determining the expected return arising out of an…
Q: Shawinigan Inc. uses a weighted-average process-costing system. All materials are introduced at the…
A: Weighted average method is one of the method used for process costing. As per this method,…
Q: [The following information applies to the questions displayed below.] In 2024, the Westgate…
A: The gross profit is calculated as the difference between the revenue and cost of goods sold. using…
Q: Your firm has total sales of $1,480 Costs are $810 and depreciation is $120. The tax rate is 25…
A: Operating cash flow is the sum of net income and depreciation expense. Net income is the difference…
Q: Net sales for the year were $1,050,000 and cost of goods sold was $735,000 for the company's…
A: Gross profit and gross profit percentage are important financial metrics that help businesses assess…
Q: Andy's Water Pets Inc. makes 100-gallon plexiglass aquariums. They reported the following financial…
A: S.NoMarginal CostingAbsorption Costing1As the name suggests itself variable cost is considered in…
Q: Onslow Company purchased a used machine for $192,000 cash on January 2. On January 3, Onslow paid…
A: All costs incurred on an asset from the date of purchase till it is installed are capitalized and…
Q: Jen and Barry's ice cream shop charges $1.45 for a cone. Variable expenses are $0.22 per cone, and…
A: The contribution margin is calculated as the difference between sales and variable costs. For extra…
Q: Nancy and Peter enter into a partnership and decide to share profits and losses as follows: 1 The…
A: Partnership means where two or more person comes together to run the business and share profit or…
Q: Ann Corporation reported pretax book income of $1,190,000. Included in the computation were…
A: The income of the company is the total earnings made by the company. It includes operating and…
Q: Allowance method entries The following transactions were completed by Wild Trout Gallery during the…
A: Bad Debt Expenses is an expense incurred to record those accounts which are uncollectible for a long…
Q: Swifty uses the periodic inventory system. For the current month, the beginning inventory consisted…
A: LIFO, or Last-In, First-Out, is an inventory valuation method where the most recently acquired items…
Q: XYZ Inc. sells a single product for $30 per unit. Variable production costs are $18 per unit Fixed…
A: The margin of safety is a financial term that helps investors and analysts evaluate the risk…
Q: Headland Company must make computations and adjusting entries for the following independent…
A: Liability might indicate that an individual owe someone money or services, but it also frequently…
Q: Ivanhoe Company issued $ 520,000, 8%, 10-year bonds on January 1, 2020, at 102. Interest is payable…
A: JOURNAL ENTRIESJournal Entry is the first stage of Accounting Process. Journal Entry is the Process…
Q: Land Profit Able Itd 1 500 1150 Croc 400 120 Rovaldo 1300 1125 Apple 200 180 Vodacom 650 400 White…
A: fill in the table is as follows:NameNature of InvesteeAccounting Base…
Q: Buddy Co. Income Statement Budget Number of Units one 3,000 $12.00 $36,000 6.00 2.00 4.00 1.50 0.75…
A: Variable cost is the cost that changes with change in the activity of cost driver used. The variable…
Q: On January 1, the Matthews Band pays $69.200 for sound equipment. The band estimates it will use…
A: Depreciation expense :— It is the allocation of depreciable cost of asset over the estimated useful…
Q: A manufacturing company that produces a single product has provided the following data concerning…
A: Variable costing system is one of the method used in cost accounting. Under this system, all the…
Q: Lois Braggs owns a small restaurant in Boston. Ms. Bragg provided her accountant with the following…
A: Amount of borrowing is the amount needed by the company to borrow from financial institution to…
Q: Cheyenne Corporation issued a 4-year, $31,000, 4% note to Greenbush Company on January 1, 2020, and…
A: Journal entries are prepared for entering transactions in the primary books of accounts by giving…
Q: Required information (The following information applies to the questions displayed below] Shadee…
A: DIRECT LABOUR BUDGET Direct labor budget estimates the total direct labor required for production…
Q: Required information SB Exercise E8-5 to E8-10 [The following information applies to the questions…
A: Budget means the expected value of future. Budget will be compared with actual value and variance is…
Q: Carpentaria Corporation's management attempts to track the time it takes to process orders. During…
A: The manufacturing cycle efficiency speaks about the efficiency of business in various aspects. It…
Q: Susan and Stan Britton are a married couple who file a joint income tax return, where the tax rates…
A: Tax liability appears to be the sum of money or obligations that an individual or business is…
Q: Cullumber Corporation has collected the following information after its first year of sales. Sales…
A: Cost-volume-profit (CVP) analysis is a managerial accounting technique used by businesses to…
Q: Financial accounting serves which primary function(s)? 1. Measures business activities. II.…
A: The primary functions of Financial Accounting are -Financial Accounting helps in measuring business…
Q: 9. Which branch of accounting involves helping individuals and businesses manage their investments…
A: A" branch of accounting" refers to a specific area or subfield within the broader discipline of…
Q: Atlantic Surf manufactures surfboards. The company's budgeted sales units for the next three months…
A: The budget is estimated on the basis of previous experience. The production budget is required to…
Q: December 31 2024 2025 2026 2027 $ $ $ Year-End Costs 96,460 131,100 141,120 $ $ Base-Year Costs…
A: DVL stands for Dollar Value LIFO method. LIFO stands for Last in first out.
Q: Accounts receivable Office supplies Trucks Accumulated depreciation-Trucks Land Accounts payable…
A: Financial Statements are prepared by the management for reporting purposes. These are the essential…
Q: Lacy is a single taxpayer. In 2023, her taxable income is $48,000. What is her tax liability in each…
A: Answer:- The amount that a person, company, or other organization owes to a government, provincial,…
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
- Bienestar, Inc., has two plants that manufacture a line of wheelchairs. One is located in Kansas City, and the other in Tulsa. Each plant is set up as a profit center. During the past year, both plants sold their tilt wheelchair model for 1,620. Sales volume averages 20,000 units per year in each plant. Recently, the Kansas City plant reduced the price of the tilt model to 1,440. Discussion with the Kansas City manager revealed that the price reduction was possible because the plant had reduced its manufacturing and selling costs by reducing what was called non-value-added costs. The Kansas City manufacturing and selling costs for the tilt model were 1,260 per unit. The Kansas City manager offered to loan the Tulsa plant his cost accounting manager to help it achieve similar results. The Tulsa plant manager readily agreed, knowing that his plant must keep pacenot only with the Kansas City plant but also with competitors. A local competitor had also reduced its price on a similar model, and Tulsas marketing manager had indicated that the price must be matched or sales would drop dramatically. In fact, the marketing manager suggested that if the price were dropped to 1,404 by the end of the year, the plant could expand its share of the market by 20 percent. The plant manager agreed but insisted that the current profit per unit must be maintained. He also wants to know if the plant can at least match the 1,260 per-unit cost of the Kansas City plant and if the plant can achieve the cost reduction using the approach of the Kansas City plant. The plant controller and the Kansas City cost accounting manager have assembled the following data for the most recent year. The actual cost of inputs, their value-added (ideal) quantity levels, and the actual quantity levels are provided (for production of 20,000 units). Assume there is no difference between actual prices of activity units and standard prices. Required: 1. Calculate the target cost for expanding the Tulsa plants market share by 20 percent, assuming that the per-unit profitability is maintained as requested by the plant manager. 2. Calculate the non-value-added cost per unit. Assuming that non-value-added costs can be reduced to zero, can the Tulsa plant match the Kansas City per-unit cost? Can the target cost for expanding market share be achieved? What actions would you take if you were the plant manager? 3. Describe the role that benchmarking played in the effort of the Tulsa plant to protect and improve its competitive position.Jansen Crafters has the capacity to produce 50,000 oak shelves per year and is currently selling 44,000 shelves for $32 each. Cutrate Furniture approached Jansen about buying 1,200 shelves for bookcases it is building and is willing to pay $26 for each shelf. No packaging will be required for the bulk order. Jansen usually packages shelves for Home Depot at a price of $1.50 per shell. The $1.50 per-shelf cost is included in the unit variable cost of $27, with annual fixed costs of $320.000. However, the $130 packaging cost will not apply in this case. The fixed costs will be unaffected by the special order and the company has the capacity to accept the order. Based on this information, what would be the profit if Jansen accepts the special order? A. Profits will decrease by $1,200. B. Profits will increase by $31,200. C. Profits will increase by $600. D. Profits will increase by $7,200.NoFat manufactures one product, olestra, and sells it to large potato chip manufacturers as the key ingredient in nonfat snack foods, including Ruffles, Lays, Doritos, and Tostitos brand products. For each of the past 3 years, sales of olestra have been far less than the expected annual volume of 125,000 pounds. Therefore, the company has ended each year with significant unused capacity. Due to a short shelf life, NoFat must sell every pound of olestra that it produces each year. As a result, NoFats controller, Allyson Ashley, has decided to seek out potential special sales offers from other companies. One company, Patterson Union (PU)a toxic waste cleanup companyoffered to buy 10,000 pounds of olestra from NoFat during December for a price of 2.20 per pound. PU discovered through its research that olestra has proven to be very effective in cleaning up toxic waste locations designated as Superfund Sites by the U.S. Environmental Protection Agency. Allyson was excited, noting that This is another way to use our expensive olestra plant! The annual costs incurred by NoFat to produce and sell 100,000 pounds of olestra are as follows: In addition, Allyson met with several of NoFats key production managers and discovered the following information: The special order could be produced without incurring any additional marketing or customer service costs. NoFat owns the aging plant facility that it uses to manufacture olestra. NoFat incurs costs to set up and clean its machines for each production run, or batch, of olestra that it produces. The total setup costs shown in the previous table represent the production of 20 batches during the year. NoFat leases its plant machinery. The lease agreement is negotiated and signed on the first day of each year. NoFat currently leases enough machinery to produce 125,000 pounds of olestra. PU requires that an independent quality team inspects any facility from which it makes purchases. The terms of the special sales offer would require NoFat to bear the 1,000 cost of the inspection team. Based solely on financial factors, explain why NoFat should accept or reject PUs special sales offer.
- NoFat manufactures one product, olestra, and sells it to large potato chip manufacturers as the key ingredient in nonfat snack foods, including Ruffles, Lays, Doritos, and Tostitos brand products. For each of the past 3 years, sales of olestra have been far less than the expected annual volume of 125,000 pounds. Therefore, the company has ended each year with significant unused capacity. Due to a short shelf life, NoFat must sell every pound of olestra that it produces each year. As a result, NoFats controller, Allyson Ashley, has decided to seek out potential special sales offers from other companies. One company, Patterson Union (PU)a toxic waste cleanup companyoffered to buy 10,000 pounds of olestra from NoFat during December for a price of 2.20 per pound. PU discovered through its research that olestra has proven to be very effective in cleaning up toxic waste locations designated as Superfund Sites by the U.S. Environmental Protection Agency. Allyson was excited, noting that This is another way to use our expensive olestra plant! The annual costs incurred by NoFat to produce and sell 100,000 pounds of olestra are as follows: In addition, Allyson met with several of NoFats key production managers and discovered the following information: The special order could be produced without incurring any additional marketing or customer service costs. NoFat owns the aging plant facility that it uses to manufacture olestra. NoFat incurs costs to set up and clean its machines for each production run, or batch, of olestra that it produces. The total setup costs shown in the previous table represent the production of 20 batches during the year. NoFat leases its plant machinery. The lease agreement is negotiated and signed on the first day of each year. NoFat currently leases enough machinery to produce 125,000 pounds of olestra. PU requires that an independent quality team inspects any facility from which it makes purchases. The terms of the special sales offer would require NoFat to bear the 1,000 cost of the inspection team. Assume for this question that NoFat rejected PUs special sales offer because the 2.20 price suggested by PU was too low. In response to the rejection, PU asked NoFat to determine the price at which it would be willing to accept the special sales offer. For its regular sales, NoFat sets prices by marking up variable costs by 10%. If Allyson decides to use NoFats 10% markup pricing method to set the price for PUs special sales offer, a. Calculate the price that NoFat would charge PU for each pound of olestra. b. Calculate the relevant profit that NoFat would earn if it set the special sales price by using its markup pricing method. (Hint: Use the estimate of relevant costs that you calculated in response to Requirement 1b.) c. Explain why NoFat should accept or reject the special sales offer if it uses its markup pricing method to set the special sales price.NoFat manufactures one product, olestra, and sells it to large potato chip manufacturers as the key ingredient in nonfat snack foods, including Ruffles, Lays, Doritos, and Tostitos brand products. For each of the past 3 years, sales of olestra have been far less than the expected annual volume of 125,000 pounds. Therefore, the company has ended each year with significant unused capacity. Due to a short shelf life, NoFat must sell every pound of olestra that it produces each year. As a result, NoFats controller, Allyson Ashley, has decided to seek out potential special sales offers from other companies. One company, Patterson Union (PU)a toxic waste cleanup companyoffered to buy 10,000 pounds of olestra from NoFat during December for a price of 2.20 per pound. PU discovered through its research that olestra has proven to be very effective in cleaning up toxic waste locations designated as Superfund Sites by the U.S. Environmental Protection Agency. Allyson was excited, noting that This is another way to use our expensive olestra plant! The annual costs incurred by NoFat to produce and sell 100,000 pounds of olestra are as follows: In addition, Allyson met with several of NoFats key production managers and discovered the following information: The special order could be produced without incurring any additional marketing or customer service costs. NoFat owns the aging plant facility that it uses to manufacture olestra. NoFat incurs costs to set up and clean its machines for each production run, or batch, of olestra that it produces. The total setup costs shown in the previous table represent the production of 20 batches during the year. NoFat leases its plant machinery. The lease agreement is negotiated and signed on the first day of each year. NoFat currently leases enough machinery to produce 125,000 pounds of olestra. PU requires that an independent quality team inspects any facility from which it makes purchases. The terms of the special sales offer would require NoFat to bear the 1,000 cost of the inspection team. Assume for this question that Allysons relevant analysis reveals that NoFat would earn a positive relevant profit of 10,000 from the special sale (i.e., the special sales alternative). However, after conducting this traditional, short-term relevant analysis, Allyson wonders whether it might be more profitable over the long term to downsize the company by reducing its manufacturing capacity (i.e., its plant machinery and plant facility). She is aware that downsizing requires a multiyear time horizon because companies usually cannot increase or decrease fixed plant assets every year. Therefore, Allyson has decided to use a 5-year time horizon in her long-term decision analysis. She has identified the following information regarding capacity downsizing (i.e., the downsizing alternative): The plant facility consists of several buildings. If it chooses to downsize its capacity, NoFat can immediately sell one of the buildings to an adjacent business for 30,000. If it chooses to downsize its capacity, NoFats annual lease cost for plant machinery will decrease to 9,000. Therefore, Allyson must choose between these two alternatives: Accept the special sales offer each year and earn a 10,000 relevant profit for each of the next 5 years or reject the special sales offer and downsize as described above. Assume that NoFat pays for all costs with cash. Also, assume a 10% discount rate, a 5-year time horizon, and all cash flows occur at the end of the year. Using an NPV approach to discount future cash flows to present value, a. Calculate the NPV of accepting the special sale with the assumed positive relevant profit of 10,000 per year (i.e., the special sales alternative). b. Calculate the NPV of downsizing capacity as previously described (i.e., the downsizing alternative). c. Based on the NPV of Requirements 5a and 5b, identify and explain which of these two alternatives is best for NoFat to pursue in the long term.Country Diner currently makes cookies for its boxed lunches. It uses 40,000 cookies annually in the production of the boxed lunches. The costs to make the cookies are: A potential supplier has offered to sell Country Diner the cookies for $0.85 each. If the cookies are purchased, 10% of the fixed overhead could be avoided. If Jason accepts the offer, what will the effect on profit be?
- 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?This year, Hassell Company will ship 4,000,000 pounds of chocolates to customers with total order-filling costs of 900,000. There are two types of customers: those who order 50,000 pound lots (small customers) and those who order 250,000 pound lots (large customers). Each customer category is responsible for buying 1,500,000 pounds. The selling price per pound is 2 per lb for the 50,000 pound lot and 3 per lb for the larger lots, due to differences in the type of chocolate. ABC would likely assign order-filling costs to the customer type as follows: a. 450,000, small; 450,000, large (using pounds as the driver) b. 360,000, small; 540,000, large (using revenue as the driver) c. 750,000, small; 150,000, large (using number of orders as the driver) d. 450,000, small; 450,000, large (using customer type as the driver)Carroll Company, a manufacturer of vitamins and minerals, has been asked by a large drugstore chain to provide bottles of vitamin E. The bottles would be labeled with the name of the drugstore chain, and the chain would pay Carroll 2.30 per bottle rather than the 3.00 regular price. Which type of a decision is this? a. Make-or-buy b. Special-order c. Keep-or-drop d. Economic order quantity e. Markup pricing
- Almond Treats manufactures various types of cereals that feature almonds. Acme Cereal Company has approached Almond Treats with a proposal to sell the company its top selling cereal at a price of $22,000 for 20,000 pounds. The costs shown are associated with production of 20,000 pounds of almond cereal: The manufacturing overhead consists of $2,000 of variable costs with the balance being allocated to fixed costs. Should Almond Treats make or buy the almond cereal?Dairyplus processes organic milk into plain yogurt. Dairyplus sells plain yogurt to hospitals, nursing homes, and restaurants in bulk, one-gallon containers. Each batch, processed at a cost of $830, yields 300 gallons of plain yogurt. Dairyplus sells the one-gallon tubs for $8 each, and spends $0.14 for each plastic tub. Dairyplus has recently begun to reconsider its strategy. Dairyplus wonders if it would be more profitable to sell individual-size portions of fruited organic yogurt at local food stores. Dairyplus could further process each batch of plain yogurt into 6,400 individual portions (3/4 cup each) of fruited yogurt. A recent market analysis indicates that demand for the product exists. Dairyplus would sell each individual portion for $0.58. Packaging would cost $0.05 per portion, and fruit would cost $0.09 per portion. Fixed costs would not change. Should Dairyplus continue to sell only the gallon-size plain yogurt (sell as is) or convert the plain…Organicplus processes organic milk into plain yogurt. Organicplus sells plain yogurt to hospitals, nursing homes, and restaurants in bulk, one-gallon containers. Each batch, processed at a cost of $870, yields 645 gallons of plain yogurt. The company sells the one-gallon tubs for $6.00 each and spends $0.12 for each plastic tub. Organicplus has recently begun to reconsider its strategy. Management wonders if it would be more profitable to sell individual-sized portions of fruited organic yogurt at local food stores. Organicplus could further process each batch of plain yogurt into 13,760 individual portions (3/4 cup each) of fruited yogurt. A recent market analysis indicates that demand for the product exists. Organicplus would sell each individual portion for $0.52. Packaging would cost $0.06 per portion, and fruit would cost $0.10 per portion. Fixed costs would not change. Should Organicplus continue to sell only the gallon-sized plain yogurt (sell as is) or convert the…