Required informationDwight Furniture makes desks specially designed for small spaces, such as studio apartments and extended-stay hotels.Each desk sells for $140 (without chair). The cost of each desk follows:MaterialsLaborVariable overheadFixed overhead ($286,000 per month, 13,000 units per month)Total costs per unitThe local university is building a new dorm and asked Dwight for a special price of $114 for an order of 900 desks.Dwight's can fill the order using existing capacity without affecting total fixed costs for the month. However, because thesale would be to a state agency, Dwight would have to file specified compliance documents with the state purchasingoffice. Dwight's manager estimates that the time and expenses incurred by this filing will amount to $7,440 and isindependent of the number of desks ordered. Dwight's manager sunsure whether to accept this order and wants youradvice.Required:a. Prepare a schedule to show the impact of providing the special order of 900 desks on Dwight's profits in addition to the regularproduction and sales of 13,000 desks per month.Complete this question by entering your answers in the tabs below.b. Based solely on the data given, what is the lowest price per unit at which the desks could be sold to the university without reducingDwight's profits?Required A Required BSales revenueLess variable costs:MaterialsLaborVariable overheadPrepare a schedule to show the impact of providing the special order of 900 desks on Dwight's profits in addition to theregular production and sales of 13,000 desks per month. (Enter your answers in thousands rounded to 1 decimal place. (i.e.,5,400,400 should be entered as 5,400.4). Select option "higher" or "lower", keeping Status Quo as the base. Select "none" ifthere is no effect.)Total variable costContribution marginLess: Fixed costsOperating profitStatus Quo13,000 Desks$Show Transcribed Text(Thousands of Dollars)Alternative13,900 Desks0.0 $Required ALowest price0.0DifferenceMaterials.LaborVariable overheadFixed overhead ($286,000 per month, 13,000 units per month)Total costs per unit.$ 4247Required B >Required informationDwight Furniture makes desks specially designed for small spaces, such as studio apartments and extended-stay hotels.Each desk sells for $140 (without chair). The cost of each desk follows:1222$ 123per deskThe local university is building a new dorm and asked Dwight for a special price of $114 for an order of 900 desks.Dwight's can fill the order using existing capacity without affecting total fixed costs for the month. However, because thesale would be to a state agency, Dwight would have to file specified compliance documents with the state purchasingoffice. Dwight's manager estimates that the time and expenses incurred by this filing will amount to $7,440 and isindependent of the number of desks ordered. Dwight's manager unsure whether to accept this order and wants youradvice.Complete this question by entering your answers in the tabs below.Required:a. Prepare a schedule to show the impact of providing the special order of 900 desks on Dwight's profits in addition to the regularproduction and sales of 13,000 desks per month.< Required Ab. Based solely on the data given, what is the lowest price per unit at which the desks could be sold to the university without reducingDwight's profits?$ 42471222$ 123Required A Required BBased solely on the data given, what is the lowest price per unit at which the desks could be sold to the university withoutreducing Dwight's profits?Required B

In order to accept a special order , the fixed cost does not change and must not be considered as…

erhead mead ($286,000 per month, 13,000 units per month) =ts per unit $ 42 47 12 22 $ 123 ersity is building a new dorm and asked Dwight for a special price of $114 for an order of 9 ill the order using existing capacity without affecting total fixed costs for the month. Howev to a state agency, Dwight would have to file specified compliance documents with the stat s manager estimates that the time and expenses incurred by this filing will amount to $7,44 of the number of desks ordered. Dwight's manager is unsure whether to accept this order.

erhead mead ($286,000 per month, 13,000 units per month) =ts per unit $ 42 47 12 22 $ 123 ersity is building a new dorm and asked Dwight for a special price of $114 for an order of 9 ill the order using existing capacity without affecting total fixed costs for the month. Howev to a state agency, Dwight would have to file specified compliance documents with the stat s manager estimates that the time and expenses incurred by this filing will amount to $7,44 of the number of desks ordered. Dwight's manager is unsure whether to accept this order.

Financial And Managerial Accounting

15th Edition

ISBN:9781337902663

Author:WARREN, Carl S.

Publisher:WARREN, Carl S.

Chapter27: Lean Manufacturing And Activity Analysis

Section: Chapter Questions

Problem 1PA: Lean principles Bright Night, Inc., manufactures light bulbs. Its purchasing policy requires that...

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Jean and Tom Perritz own and manage Happy Home Helpers. Inc. (HHH), a house-cleaning service. Each cleaning (cleaning one house one time) takes a team of three house cleaners about 1.5 hours. On average, HHH completes about 15,000 cleanings per year. The following total costs are associated with the total cleanings: Next year, HHH expects to purchase 25,600 of direct materials. Projected beginning and ending inventories for direct materials are as follows: There is no work-in-process inventory and no finished goods inventory; in other words, a cleaning is started and completed on the same day. Required: 1. Prepare a statement of cost of services sold in good form. 2. How does this cost of services sold statement differ from the cost of goods sold statement for a manufacturing firm?
Cost Identification and Analysis, Cost Assignment, Income Statement Melissa Vassar has decided to open a printing shop. She has secured two contracts. One is a 5-year contract to print a popular regional magazine. This contract calls for 5,000 copies each month. The second contract is a 3-year agreement to print tourist brochures for the state. The state tourist office requires 10,000 brochures per month. Melissa has rented a building for 1,400 per month. Her printing equipment was purchased for 40,000 and has a life expectancy of 20,000 hours with no salvage value. Depreciation is assigned to a period based on the hours of usage. Melissa has scheduled the delivery of the products so that two production runs are needed. In the first run, the equipment is prepared for the magazine printing. In the second run, the equipment is reconfigured for brochure printing. It takes twice as long to configure the equipment for the magazine setup as it does for the brochure setup. The total setup costs per month are 600. Insurance costs for the building and equipment are 140 per month. Power to operate the printing equipment is strongly related to machine usage. The printing equipment causes virtually all the power costs. Power costs will run 350 per month. Printing materials will cost 0.40 per copy for the magazine and 0.08 per copy for the brochure. Melissa will hire workers to run the presses as needed (part-time workers are easy to hire). She must pay 10 per hour. Each worker can produce 20 copies of the magazine per printing hour or 100 copies of the brochure. Distribution costs are 500 per month. Melissa will receive a salary of 1,500 per month. She is responsible for personnel, accounting, sales, and productionin effect, she is responsible for administering all aspects of the business. Required: 1. What are the total monthly manufacturing costs? 2. What are the total monthly prime costs? What are the total monthly prime costs for the regional magazine? For the brochure? 3. What are the total monthly conversion costs? Suppose Melissa wants to determine monthly conversion costs for each product. Assign monthly conversion costs to each product using direct tracing and driver tracing whenever possible. For those costs that cannot be assigned using a tracing approach, you may assign them using direct labor hours. 4. Melissa receives 1.80 per copy of the magazine and 0.45 per brochure. Prepare an income statement for the first month of operations.
Jean and Tom Perritz own and manage Happy Home Helpers, Inc. (HHH), a house-cleaning service. Each cleaning (cleaning one house one time) takes a team of three house cleaners about 1.5 hours. On average, HHH completes about 15,000 cleanings per year. The following total costs are associated with the total cleanings: Next year, HHH expects to purchase 25,600 of direct materials. Projected beginning and ending inventories for direct materials are as follows: There is no work-in-process inventory; in other words, a cleaning is started and completed on the same day. Required: 1. Prepare a statement of services produced in good form. 2. What if HHH planned to purchase 30,000 of direct materials? Assume there would be no change in beginning and ending inventories of materials. Explain which line items on the statement of services produced would be affected and how (increase or decrease).
Jean and Tom Perritz own and manage Happy Home Helpers, Inc. (HHH), a house-cleaning service. Each cleaning (cleaning one house one time) takes a team of three house cleaners about 1.5 hours. On average, HHH completes about 15,000 cleanings per year. The following total costs are associated with the total cleanings: Next year, HHH expects to purchase 25,600 of direct materials. Projected beginning and ending inventories for direct materials are as follows: There is no work-in-process inventory and no finished goods inventory; in other words, a cleaning is started and completed on the same day. HHH expects to sell 15,000 cleanings at a price of 45 each next year. Total selling expense is projected at 22,000, and total administrative expense is projected at 53,000. Required: 1. Prepare an income statement in good form. 2. What if Jean and Tom increased the price to 50 per cleaning and no other information was affected? Explain which line items in the income statement would be affected and how.
Cost Definitions Luisa Giovanni is a student at New York University. To help pay her way through college, Luisa started a dog walking service. She has 12 client dogssix are walked on the first shift (6:30 A.M. and 5:00 P.M.), and six are walked on the second shift (7:30 A.M. and 6:00 P.M.). Last month, Luisa noted the following: 1. Purchase of three leashes at 10 each (she carries these with her in case a leash breaks during a walk). 2. Internet service cost of 40 a month. This enables her to keep in touch with the owners, bill them by email, and so on. 3. Dog treats of 50 to reward each dog at the end of each walk. 4. A heavy-duty raincoat and hat for 100. 5. Partway through the month, Luisas friend, Jason, offered her a chance to play a bit role in a movie that was shooting on location in New York City. The job paid 100 and would have required Luisa to be on location at 6:00 A.M. and to remain for 12 hours. Regretfully, Luisa turned it down. 6. The dog owners pay Luisa 250 per month per dog for her services. Required: 1. At the end of the month, how would Luisa classify her Internet payment of 40as a cost on the balance sheet or as an expense on the income statement? 2. CONCEPTUAL CONNECTION Which of the above items is an opportunity cost? Why? 3. What price is charged? What is Luisas total revenue for a month?
Lean principles Bright Night, Inc., manufactures light bulbs. Its purchasing policy requires that the purchasing agents place each quarters purchasing requirements out for bid. This is because the Purchasing Department is evaluated solely by its ability to get the lowest purchase prices. The lowest bidder receives the order for the next quarter (90 working days). To make its bulb products, Bright Night requires 36,000 pounds of glass per quarter. Bright Night received two glass bids for the third quarter, as follows: Central Glass Company: 30.00 per pound of glass. Delivery schedule: 36,000 (400 lbs. x 90 days) pounds at the beginning of July to last for 3 months. Ithaca Glass Company: 30.20 per pound of glass. Delivery schedule: 400 pounds per working day (90 days in the quarter). Bright Night accepted Central Glass Companys bid because it was the low-cost bid. Instructions 1. Comment on Bright Nights purchasing policy. 2. What are the additional (hidden) costs, beyond price, of Central Glass Companys bid? Why werent these costs considered? 3. Considering only inventory financing costs, what is the additional cost per pound of Central Glass Companys bid if the annual cost of money is 8%? (Hint: Determine the average value of glass inventory held for the quarter and multiply by the quarterly interest charge, then divide by the number of pounds.)