QUESTION 8All of the following companies would most likely use process costing EXCEPTOA Ryan Homebuilders, Inc.OB. Coca ColaOC Dupont ChemicalsD. Campbell's Soups

Process costing is a type of costing which is used for…

Answered: Owing companies would most likely use…

Business

Accounting

Owing companies would most likely use process costing EXCEPT OA Ryan Hometuilders Inc

Accounting Information Systems

11th Edition

ISBN:9781337552127

Author:Ulric J. Gelinas, Richard B. Dull, Patrick Wheeler, Mary Callahan Hill

Publisher:Ulric J. Gelinas, Richard B. Dull, Patrick Wheeler, Mary Callahan Hill

Chapter15: Integrated Production Processes (ipps)

Section: Chapter Questions

Problem 3P

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(Appendix 3A) Separating Fixed and Variable Costs, Service Setting Louise McDermott, controller for the Galvin plant of Veromar Inc., wanted to determine the cost behavior of moving materials throughout the plant. She accumulated the following data on the number of moves (from 100 to 800 in increments of 100) and the total cost of moving materials at those levels of moves: Required: 1. Prepare a scattergraph based on these data. Use cost for the vertical axis and number of moves for the horizontal axis. Based on an examination of the scattergraph, does there appear to be a linear relationship between the total cost of moving materials and the number of moves? 2. Compute the cost formula for moving materials by using the high-low method. Calculate the predicted cost for a month with 550 moves by using the high-low formula. (Note: Round the answer for the variable rate to three decimal places and the answer for total fixed cost and total cost to the nearest dollar.) 3. CONCEPTUAL CONNECTION Compute the cost formula for moving materials using the method of least squares. (Note: For the method of least squares, round the variable rate to two decimal places and total fixed cost and total cost to the nearest dollar.) Using the regression cost formula, what is the predicted cost for a month with 550 moves? What does the coefficient of determination tell you about the cost formula computed by regression? 4. CONCEPTUAL CONNECTION Evaluate the cost formula using the least squares coefficients. Could it be improved? Try dropping the third data point (300, 3,400), and rerun the regression.
Activity-based costing in an insurance company Umbrella Insurance Company carries three major lines of insurance: auto, workers' compensation, and homeowners. The company has prepared the following report for 20Y2: Management is concerned that the administrative expenses may make some of the insurance lines unprofitable. However, the administrative expenses have not been allocated to the insurance lines. The controller has suggested that the administrative expenses could be assigned to the insurance lines using activity-based costing. The administrative expenses are comprised of five activities. The activities and their rates are as follows: Activity-base usage data for each line of insurance were retrieved from the corporate records and are shown below. a.Complete the product profitability report through the administrative activities. b.Determine the underwriting income as a percent of premium revenue. C.Determine the Operating income as a percent of premium revenue, rounded to one decimal place. d.Interpret the report.
19) Which among the following decision can be taken with Life Cycle Costing method? a. All the options listed b. Implementing new computerized system in the company c. Making choice between competing supplies of products and services d. Purchase of a machinery to be used in production process
Last question 4) The company uses normal costing with two direct-cost categories: Direct materials Direct manufacturing labor Furthermore, the company uses two manufacturing overhead cost pools: Machining department with machine- hours as the allocation base Assembly department with direct manufacturing labor costs as the allocation base. The budget for the plant in 2020 is as follows: Production plant Machine department Assembly department Manufacturing overhead costs 13 597 500 12 271 500 Direct manufacturing labor costs 1 455 000 6 075 000 Direct manufacturing labor-hours 54 000 22 500 Machine-hours 277 500 55 500 What is the budgeted manufacturing overhead rate in the machining and the assembly department? Overhead is the direct cost involved in the production process of the business of the company Calculation of budgeted manufacturing overhead rate in machine department: Budgeted manufacturing…
3 2. An intern suggested that the company use activity-based costing to cost its products. A team was formed to investigate this idea, and it came back with the recommendation that four activity cost pools be used. These cost pools and their associated activities follow: 5 ints 00:40:40 Activity Cost Pool and Activity Measure Purchase orders (number of orders) Rework requests (number of requests) Product testing (number of tests) Machine related (machine-hours) Activity Cost Pool Purchase orders Rework requests Product testing Machine related Estimated Overhead Cost $ 170,000 374,400 350,000 1,150,000 $2,044,400 Compute the activity rate (i.e., predetermined overhead rate) for each of the activity cost pools. Activity Rate per order per request per test per MH Deluxe 1,000 600 5,000 18,000 Activity Regular 1,500 1,200 12,500 28,000 Total 2,500 1,800 17,500 46,000 3. Assume that actual activity is as expected for the year. Using activity-based costing, do the following: a. Determine the…
QUESTION 48 For a given process/department, if there is no beginning work-in-process, both the weighted average and first-in first out (FIFO) methods of process costing result in the same amount for which of the following? I. Equivalent units of production for materials II. Cost per equivalent unit for conversion III. Cost of completed units IV. Cost of ending work-in-process A. I and III B. II and IV C. I and II D. I, II, III, and IV E. I, III, IV
Required information Problem 04-5A Pricing analysis with ABC and a plantwide overhead rate LO A1, A2, P1, P3 Skip to question [The following information applies to the questions displayed below.] Sara’s Salsa Company produces its condiments in two types: Extra Fine for restaurant customers and Family Style for home use. Salsa is prepared in department 1 and packaged in department 2. The activities, overhead costs, and drivers associated with these two manufacturing processes and the company’s production support activities follow. Process Activity Overhead cost Driver Quantity Department 1 Mixing $ 5,800 Machine hours 2,200 Cooking 12,900 Machine hours 2,200 Product testing 113,800 Batches 1,000 $ 132,500 Department 2 Machine calibration $ 315,000 Production runs 500 Labeling 20,000 Cases of output 145,000 Defects 9,000 Cases of output 145,000 $ 344,000 Support Recipe formulation $ 82,000 Focus groups 40 Heat,…
Required information Problem 04-5A Pricing analysis with ABC and a plantwide overhead rate LO A1, A2, P1, P3 Skip to question [The following information applies to the questions displayed below.] Sara’s Salsa Company produces its condiments in two types: Extra Fine for restaurant customers and Family Style for home use. Salsa is prepared in department 1 and packaged in department 2. The activities, overhead costs, and drivers associated with these two manufacturing processes and the company’s production support activities follow. Process Activity Overhead cost Driver Quantity Department 1 Mixing $ 5,800 Machine hours 2,200 Cooking 12,900 Machine hours 2,200 Product testing 113,800 Batches 1,000 $ 132,500 Department 2 Machine calibration $ 315,000 Production runs 500 Labeling 20,000 Cases of output 145,000 Defects 9,000 Cases of output 145,000 $ 344,000 Support Recipe formulation $ 82,000 Focus groups 40 Heat,…
TB MC Qu. 1-72 The cost of lubricants ... The cost of lubricants used to grease a production machine in a manufacturing company is an example of a(n): Multiple Choice indirect material cost. direct material cost. period cost. opportunity cost.
Wolseley’s dilemma of Traditional Costing versus Activity Based Costing Wolseley Manufacturing Corporation manufactures various electronics products and follows a traditional (job-order) costing system in which it applies manufacturing overhead to its products using a predetermined overhead rate based on direct labour-hours (DLHs). The company has two products, C18R and G19R, about which it has provided the following data: C18R G19R Direct materials per unit $10.20 $50.50 Direct labour per unit $8.40 $25.20 Direct labour hours per unit 0.40 1.20 Annual production 30,000 10,000 The company's estimated total manufacturing overhead for the year is $1,464,480 and the company's estimated total direct labour-hours for the year is 24,000.The company is considering using a variation of activity-based costing to determine its unit product costs for external reports. Data for this proposed activity-based costing system appear below: Activities…
choose best among all:( mcqs) 1. Tallon Company manufactures a single product. The product's prime costs consist of a direct materials and direct labor. b direct materials and manufacturing overhead. c direct materials, direct labor and manufacturing overhead. d direct labor and manufacturing overhead. 2. In a traditional job costing system, the use of indirect labor in the production department increases: a: Stores Control b: Manufacturing Overhead Control. c: Manufacturing Overhead Applied d: Work-in-Process Control.
Which company is least likely to use a process costing system? a. Paper manufacturer b. Soft drink bottler c. Accounting firm d. Petroleum processor