Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN: 9781305970663
Author: Don R. Hansen, Maryanne M. Mowen
Publisher: Cengage Learning
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Chapter 1, Problem 7E
To determine
Identify whether Person K, Person J and Person L are in line position or staff position and provide explanation.
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Ana Perez is the plant manager of Travel Free’s Indiana plant. The Camper and Trailer operating departments manufacture products and have their own managers. The Office department, which Perez also manages, provides services equally to the two operating departments.
Each performance report includes only those costs that a particular operating department manager can control: direct materials, direct labor, supplies used, and utilities. The plant manager is responsible for the department managers’ salaries, building rent, office salaries other than her own, and other office costs plus all costs controlled by the two operating department managers.
The annual departmental budgets and actual costs for the two operating departments follow.
The Office department’s budgeted and actual costs follow.
Required
Prepare responsibility accounting performance reports like those in costs controlled by the following.
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The following describes the job responsibilities of two employees of Barney Manufacturing.Joan Dennison, Cost Accounting Manager. Joan is responsible for measuring and collectingcosts associated with the manufacture of the garden hose product line. She is also responsiblefor preparing periodic reports that compare the actual costs with planned costs. These reportsare provided to the production line managers and the plant manager. Joan helps to explain andinterpret the reports.Steven Swasey, Production Manager. Steven is responsible for the manufacture of thehigh-quality garden hose. He supervises the line workers, helps to develop the productionschedule, and is responsible for seeing that production quotas are met. He is also held accountable for controlling manufacturing costs.Required:CONCEPTUAL CONNECTION Identify Joan and Steven as line or staff and explain yourreasons.
Elizabeth Flanigan and Associates is an engineering and design firm that specializes in developing plans for recycling plants for municipalities. The firm uses a job costing system to accumulate the cost associated with each design project. Flanigan employs three levels of employee: senior engineers, associate engineers, and clerical staff. The salary cost of the senior en- gineers and the associate engineers is assigned to each project as direct labor. The salary cost of the clerical staff is included in overhead, along with the cost of engineering supplies, automobile travel, and equipment depreciation. The cost of airline travel, motels, building permits, and fees from other consultants is charged to each project as direct materials. Overhead is applied to projects using a predetermined overhead rate based on total engineering hours. The rate is $5 per hour. The six different salary levels for the employees of Elizabeth Flanigan and Associates are listed below. The hourly rate is…
Chapter 1 Solutions
Cornerstones of Cost Management (Cornerstones Series)
Ch. 1 - What is cost management, and how does it differ...Ch. 1 - How do cost management and financial accounting...Ch. 1 - Identify and discuss the factors that affect the...Ch. 1 - What is a flexible manufacturing system?Ch. 1 - Prob. 5DQCh. 1 - What is the difference between a line position and...Ch. 1 - The controller should be a member of the top...Ch. 1 - Prob. 8DQCh. 1 - What is the role of cost management with respect...Ch. 1 - Prob. 10DQ
Ch. 1 - What is business ethics? Is it possible to teach...Ch. 1 - Firms with higher ethical standards will...Ch. 1 - Prob. 13DQCh. 1 - Prob. 14DQCh. 1 - What are the two parts to the CMA examination?...Ch. 1 - Classify each of the following actions as either...Ch. 1 - Hepworth Communications produces cell phones. One...Ch. 1 - Prob. 3ECh. 1 - Consider the following thoughts of a manager at...Ch. 1 - Bill Christensen, the production manager, was...Ch. 1 - Each of the following scenarios requires the use...Ch. 1 - Prob. 7ECh. 1 - Lily Shultz is a junior majoring in hotel and...Ch. 1 - John Biggs and Patty Jorgenson are both cost...Ch. 1 - Emily Henson, controller of an oil exploration...Ch. 1 - Prob. 11PCh. 1 - Emery Manufacturing Company produces component...Ch. 1 - Prob. 13P
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