Value- and Non-Value-Added Cost Reporting Cicleta Manufacturing has four activities: receiving materials, assembly, expediting products, and storing goods. Receiving and assembly are necessary activities; expediting and storing goods are unnecessary. The following data pertain to the four activities for the year ending 2014 (actual price per unit of the activity driver is assumed to be equal to the standard price): Activity Activity Driver SQ AQ SP Receiving Receiving orders 13,600 27,000 $24 Assembly Labor hours 111,000 135,000 17 Expediting Orders expedited 0 9,000 57 Storing Number of units 0 18,000 8 Required: 1. Prepare a cost report for the year ending 2014 that shows value-added costs, non-value-added costs, and total costs for each activity. If an amount is zero, enter "0". Cicleta Manufacturing Value and Non-Value-Added Cost Report For the Year Ended 2014 Activity Value-Added Costs Non-Value-Added Costs Total Costs Receiving $fill in the blank db1f18f9efb1fe3_1 $fill in the blank db1f18f9efb1fe3_2 $fill in the blank db1f18f9efb1fe3_3 Assembly fill in the blank db1f18f9efb1fe3_4 fill in the blank db1f18f9efb1fe3_5 fill in the blank db1f18f9efb1fe3_6 Expediting fill in the blank db1f18f9efb1fe3_7 fill in the blank db1f18f9efb1fe3_8 fill in the blank db1f18f9efb1fe3_9 Storing fill in the blank db1f18f9efb1fe3_10 fill in the blank db1f18f9efb1fe3_11 fill in the blank db1f18f9efb1fe3_12 Total $fill in the blank db1f18f9efb1fe3_13 $fill in the blank db1f18f9efb1fe3_14 $fill in the blank db1f18f9efb1fe3_15 2. Explain why expediting products and storing goods are non-value-added activities.

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter12: Activity-based Management

Section: Chapter Questions

Problem 1CE: Cicleta Manufacturing has four activities: receiving materials, assembly, expediting products, and...

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Value- and Non-Value-Added Cost Reporting

Cicleta Manufacturing has four activities: receiving materials, assembly, expediting products, and storing goods. Receiving and assembly are necessary activities; expediting and storing goods are unnecessary. The following data pertain to the four activities for the year ending 2014 (actual price per unit of the activity driver is assumed to be equal to the standard price):

Activity	Activity Driver	SQ	AQ	SP
Receiving	Receiving orders	13,600	27,000	$24
Assembly	Labor hours	111,000	135,000	17
Expediting	Orders expedited	0	9,000	57
Storing	Number of units	0	18,000	8

Required:

1. Prepare a cost report for the year ending 2014 that shows value-added costs, non-value-added costs, and total costs for each activity. If an amount is zero, enter "0".

Cicleta Manufacturing
Value and Non-Value-Added Cost Report
For the Year Ended 2014
Activity	Value-Added Costs	Non-Value-Added Costs	Total Costs
Receiving	$fill in the blank db1f18f9efb1fe3_1	$fill in the blank db1f18f9efb1fe3_2	$fill in the blank db1f18f9efb1fe3_3
Assembly	fill in the blank db1f18f9efb1fe3_4	fill in the blank db1f18f9efb1fe3_5	fill in the blank db1f18f9efb1fe3_6
Expediting	fill in the blank db1f18f9efb1fe3_7	fill in the blank db1f18f9efb1fe3_8	fill in the blank db1f18f9efb1fe3_9
Storing	fill in the blank db1f18f9efb1fe3_10	fill in the blank db1f18f9efb1fe3_11	fill in the blank db1f18f9efb1fe3_12
Total	$fill in the blank db1f18f9efb1fe3_13	$fill in the blank db1f18f9efb1fe3_14	$fill in the blank db1f18f9efb1fe3_15

2. Explain why expediting products and storing goods are non-value-added activities.

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