Wave Runners is a boat rental business that has the following costs over the relevant range of 18,000 to 24,000 operating hours for its boats: Required: 1. Complete the schedule of the company's total and unit costs. (Round "Cost per hour" answers to 2 decimal places.) Total costs: Variable costs Fixed costs Total costs Cost per unit: Variable cost Fixed cost Total cost per hour $ $ 18,000 57,600 277,200 334,800 Operating Hours 20,000 22,000 24,000 2. Assume that Wave Runners rents it boats for $17 per hour and had 21,000 hours of rentals last year. Prepare a contribution format income statement for the year.

Wave Runners is a boat rental business that has the following costs over the relevant range of 18,000 to 24,000 operating hours for its boats: Required: 1. Complete the schedule of the company's total and unit costs. (Round "Cost per hour" answers to 2 decimal places.) Total costs: Variable costs Fixed costs Total costs Cost per unit: Variable cost Fixed cost Total cost per hour $ $ 18,000 57,600 277,200 334,800 Operating Hours 20,000 22,000 24,000 2. Assume that Wave Runners rents it boats for $17 per hour and had 21,000 hours of rentals last year. Prepare a contribution format income statement for the year.

Name: l.Subject :- Accounting Wave Runners is a boat rental business that ha
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Description: l.Subject :- Accounting Wave Runners is a boat rental business that has the following costs over the relevant range of 18,000 to 24,000 operating hours for itsboats:Required:1. Complete the schedule of the company's total and unit costs. (Round "Cost

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter3: Cost Behavior

Section: Chapter Questions

Problem 10E: SmokeCity, Inc., manufactures barbeque smokers. Based on past experience, SmokeCity has found that...

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Roper Furniture manufactures office furniture and tracks cost data across their process. The following are some of the costs that they incur. Classify these costs as fixed or variable costs, and as product costs or period costs. Wood used to produce desks ($125,00 per desk) Production labor used to produce desks ($15 per hour) Production supervisor salary ($45,000 per year) Depreciation on factory equipment ($60,000 per year) Selling and administrative expenses ($45,000 per year) Rent on corporate office ($44,000 per year) Nails, glue, and other materials required to produce desks (varies per desk) Utilities expenses for production facility Sales staff commission (5% of gross sales)
The following product costs are available for Stellis Company on the production of erasers: direct materials, $22,000; direct labor, $35,000; manufacturing overhead, $17,500; selling expenses, $17,600; and administrative expenses; $13,400. What are the prime costs? What are the conversion costs? What is the total product cost? What is the total period cost? If 13,750 equivalent units are produced, what is the equivalent material cost per unit? If 17,500 equivalent units are produced, what is the equivalent conversion cost per unit?
The following product costs are available for Kellee Company on the production of eyeglass frames: direct materials, $32,125; direct labor, $23.50; manufacturing overhead, applied at 225% of direct labor cost; selling expenses, $22,225; and administrative expenses, $31,125. The direct labor hours worked for the month are 3,200 hours. A. What are the prime costs? B. What are the conversion costs? C. What is the total product cost? D. What is the total period cost? E. If 6.425 equivalent units are produced, what is the equivalent material cost per unit? F. What is the equivalent conversion cost per unit?
Cool Pool has these costs associated with production of 20,000 units of accessory products: direct materials, $70; direct labor, $110; variable manufacturing overhead, $45; total fixed manufacturing overhead, $800,000. What is the cost per unit under both the variable and absorption methods?
SmokeCity, Inc., manufactures barbeque smokers. Based on past experience, SmokeCity has found that its total annual overhead costs can be represented by the following formula: Overhead cost = 543,000 + 1.34X, where X equals number of smokers. Last year, SmokeCity produced 20,000 smokers. Actual overhead costs for the year were as expected. Required: 1. What is the driver for the overhead activity? 2. What is the total overhead cost incurred by SmokeCity last year? 3. What is the total fixed overhead cost incurred by SmokeCity last year? 4. What is the total variable overhead cost incurred by SmokeCity last year? 5. What is the overhead cost per unit produced? 6. What is the fixed overhead cost per unit? 7. What is the variable overhead cost per unit? 8. Recalculate Requirements 5, 6, and 7 for the following levels of production: (a) 19,500 units and (b) 21,600 units. (Round your answers to the nearest cent.) Explain this outcome.
Use the following information to determine net income in the financial statements under GAAP: Number of boats to be sold 560 Upstream costs $ 5,300,000 Direct materials per boat $ 56,000 Direct labor per boat $36,000 Overhead per boat $ 26,000 Downstream costs $ 2,300,000 Assume the company wants to sell each boat for 20% more than the cost to produce the boat.
Neptune Rentals operates a boat rental service. Consider the following costs of the company over the relevant range of 5,000 to 8,000 hours of operating time for its boats:Hours of Operating Time5,000 6,000 7,000 8,000Total costs:Variable costs ............... $ 20,000 $ ? $ ? $ ?Fixed costs ................... 168,000 ? ? ?Total costs ....................... $188,000 $ ? $ ? $ ?Cost per hour:Variable cost ................. $ ? $ ? $ ? $ ?Fixed cost ..................... ? ? ? ?Total cost per hour ........... $ ? $ ? $ ? $ ?Required:Compute the missing amounts, assuming that cost behavior patterns remain unchanged within the relevantrange of 5,000 to 8,000 hours.
Soneva Enterprise manufactures two models of boats- Regular & Deluxe, using a combination of hand finishing and machining. Machine setup costs are driven by the number of setups. Indirect labor cost increase with direct labor costs. Equipment and maintenance costs increase with the number of machine hours, and facility rent is paid per square foot. The capacity of the facility is 6250 square foot and Soneva is using only 80% of this capacity. Soneva records the cost of unused capacity as a separate line item and not as a product cost. For 2021, Soneva has budgeted the following: Soneva Adventures- Budgeted Costs & Activities (Year Ending 31st March 2021) Particulars Amount (in Rs.) Direct Materials- Regular Boats 3,250,000 Direct Materials- Deluxe Boats 2,400,000 Direct Labour- Regular Boats 1,100,000 Direct Labour- Deluxe Boats 1,300,000 Indirect Labour Costs 720,000 Machine Setup Costs 405,000 Equipment and Maintenance Costs…
Gigondas Incorporated had the following information: Avtivity Driver Unit Variable Cost Level of Activity Driver Units Sold $20 -- Setups 1,000 40 Engineering Hours 60 1,000 Other Data: Total Fixed Cost (Conventional) $100,000 Total Fixed Cost (ABC) $50,000 Unit Selling Price $40 Calculate the number of units using the activity-based costing approach, that must be sold to earn a before-tax profit of $40,000.
Zion Manufacturing had always made its components in-house. However, Bryce Component Works had recently offered to supply one component, K2, at a price of $11 each. Zion uses 4,900 units of Component K2 each year. The cost per unit of this component is as follows: Direct materials $7.23 Direct labor 2.14 Variable overhead 1.29 Fixed overhead 4.00 Total $14.66 1. What are the alternatives facing Zion Manufacturing with respect to List the relevant costs for each alternative. If required, round your answers to the nearest cent. Total Relevant Cost Make $ per unit Buy $ per unit Differential Cost to Make $ per unit If Zion decides to purchase the component from Bryce, by how much will operating income increase or decrease? $ 3. Conceptual Connection: Which alternative is better?
Sandy Bank, Inc., makes one model of wooden canoe. and, the information for it follows: Number of canoes produced and sold 400 600 750 Total costs Variable costs $ 50,000 $ 75,000 $ 93,750 Fixed costs $ 90,000 $ 90,000 $ 90,000 Total costs $ 140,000 $ 165,000 $ 183,750 Cost per unit Variable cost per unit $ 125.00 $ 125.00 $ 125.00 Fixed cost per unit 225.00 150.00 120.00 Total cost per unit $ 350.00 $ 275.00 $ 245.00 Sandy Bank sells its canoes for $375 each. Required: 1. Suppose that Sandy Bank raises its selling price to $500 per canoe. Calculate its new break-even point in units and in sales dollars. 2. If Sandy Bank sells 670 canoes, compute its margin of safety in dollars and as a percentage of sales. (Use the new sales price of $500.) 3. Calculate the number of canoes that Sandy Bank must sell at $500 each to generate $100,000 profit.
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