PROBLEM 1: COST CENTER: ABC Corporation, a corporation with fully decentralized its operations, is evaluating its managers. The manager of its customer service department is currently being evaluated for the month just ended. Relevant costs are as follows: Manager salary of P50,000; Staff salaries of P60,000; Rent of P100,000; Utilities of P20,000 (P2,000 is the minimum due to the location); Supplies of P10,000; Depreciation of P80,000; other administrative costs - controllable of P12,000; and other administrative costs - non-controllable of P20,000. How much is the cost relevant to the performance measurement of the cost manager?
PROBLEM 1: COST CENTER: ABC Corporation, a corporation with fully decentralized its operations, is evaluating its managers. The manager of its customer service department is currently being evaluated for the month just ended. Relevant costs are as follows: Manager salary of P50,000; Staff salaries of P60,000; Rent of P100,000; Utilities of P20,000 (P2,000 is the minimum due to the location); Supplies of P10,000; Depreciation of P80,000; other administrative costs - controllable of P12,000; and other administrative costs - non-controllable of P20,000. How much is the cost relevant to the performance measurement of the cost manager?
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter6: Cost-volume-profit Analysis
Section: Chapter Questions
Problem 6PB: Contribution margin, break-even sales, cost-volume-profit chart, margin of safety, and operating...
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Transcribed Image Text:PROBLEM 1: COST CENTER: ABC Corporation, a
corporation with fully decentralized its
operations, is evaluating its managers. The
manager of its customer service department is
currently being evaluated for the month just
ended. Relevant costs are as follows: Manager
salary of P50,000; Staff salaries of P60,000; Rent
of P100,000; Utilities of P20,000 (P2,000 is the
minimum due to the location); Supplies of
P10,000; Depreciation of P80,000; other
administrative costs - controllable of P12,000;
and other administrative costs - non-controllable
of P20,000.
How much is the cost relevant to the
performance measurement of the
cost manager?
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