SURVEY OF ACCOUNTING 360DAY CONNECT CAR
5th Edition
ISBN: 9781260591811
Author: Edmonds
Publisher: MCG
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Question
Chapter 10, Problem 28P
a.
To determine
The annual holding cost of raw materials.
b.
To determine
Explain the reason the way just in time would reduce the inventory holding cost.
c.
To determine
Explain the manner in which most-favoured-customers could allow Company K to start just in time system without risking the raw materials scarcities experienced in the past.
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TF 4 part b
Sharon Lee, CEO of Carla Vista Industries, is concerned about the recent volatility in the company’s operating income. She believes that since the number of units sold has been fairly stable over the past three years that operating income also should have been stable. Sharon asked Brian Walker, Carla Vista's inventory manager, to help her understand the issue.Brian reviewed the company’s records and compiled the following changes to Finished Goods Inventory (in units) for the years 2019, 2020, and 2021.
Year
2019
2020
2021
Beginning inventory
1,000
2,000
500
Production
40,000
38,000
40,000
Sales
(39,000)
(39,500)
(39,500)
Ending inventory
2,000
500
1,000
Brian also gathered the 2019 income statements prepared using absorption costing and variable costing, which follow.
Income Statement—Absorption Costing
Sales
$
4,875,000
Cost of goods sold…
Case Study 4: Inventory Management.
(II) A regional distributor purchases discontinued appliances from various suppliers and then sells them on demand to retailers in the region. The distributor operates 5 days per week, 52 weeks per year. Only when it is open for business can orders be received. Management wants to reevaluate its current inventory policy, which calls for order quantities of 440 counter-top mixers. The following data are estimated for the mixer:
Average daily demand 100 mixers
Standard deviation of daily demand 30 mixers
Lead time (L) = 3 days
Holding Cost (H) = $9.40/order/year
Ordering Cost (S) = $35/order
Cycle service level = 92%
The distributor uses a continuous review (Q) system
What order quantity, Q, and reorder point, R, should be used?
What is the total annual cost of the system?
If on-hand inventory is 40 units, one open order for 440 mixers is pending and no back orders exist, should a new order be placed?
Exercise 6-14 (Algo) Calculate inventory using lower of cost and net realizable value (LO6-6)
[The following information applies to the questions displayed below.]
A company like Golf USA that sells golf-related inventory typically will have inventory items such as golf clothing and golf equipment. As technology advances the design and performance of the next generation of drivers, the older models become less marketable and therefore decline in value. Suppose that in the current year, Ping (a manufacturer of golf clubs) introduces the MegaDriver II, the new and improved version of the MegaDriver. Below are year-end amounts related to Golf USA’s inventory.
Inventory
Quantity
Unit Cost
Unit NRV
Shirts
38
$55
$73
MegaDriver
18
390
330
MegaDriver II
33
410
450
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Chapter 10 Solutions
SURVEY OF ACCOUNTING 360DAY CONNECT CAR
Ch. 10 - 1. What are some differences between financial and...Ch. 10 - 2. What does the value-added principle mean as it...Ch. 10 - 4. How does product costing used in financial...Ch. 10 - 5. What does the statement costs can be assets or...Ch. 10 - 6. Why are the salaries of production workers...Ch. 10 - 7. How do product costs affect the financial...Ch. 10 - 8. What is an indirect cost? Provide examples of...Ch. 10 - 9. How does a product cost differ from a selling,...Ch. 10 - 10. Why is cost classification important to...Ch. 10 - 11. What is cost allocation? Give an example of a...
Ch. 10 - 13. What are some of the common ethical conflicts...Ch. 10 - 14. What costs should be considered in determining...Ch. 10 - 15. What is a just-in-time (JIT) inventory system?...Ch. 10 - Prob. 14QCh. 10 - Prob. 15QCh. 10 - Prob. 16QCh. 10 - Prob. 17QCh. 10 - Prob. 18QCh. 10 - Prob. 19QCh. 10 - Prob. 1ECh. 10 - Exercise 1-2A Identifying product versus selling,...Ch. 10 - Prob. 3ECh. 10 - Prob. 4ECh. 10 - Prob. 5ECh. 10 - Exercise 1-6A Identifying product versus SGA costs...Ch. 10 - LO 1-3 Exercise 1-7A Recording product versus SGA...Ch. 10 - Prob. 8ECh. 10 - LO 1-4 Exercise 1-9A Upstream, midstream, and...Ch. 10 - Prob. 10ECh. 10 - Prob. 11ECh. 10 - Prob. 12ECh. 10 - Prob. 13ECh. 10 - Cost of goods manufactured and sold The following...Ch. 10 - Prob. 15ECh. 10 - Exercise 1-14A Using JIT to minimize waste and...Ch. 10 - Prob. 17ECh. 10 - Prob. 18ECh. 10 - Prob. 19ECh. 10 - Prob. 20ECh. 10 - Problem 1-19A Characteristics of financial versus...Ch. 10 - Prob. 22PCh. 10 - Problem 1-21A Effect of product versus period...Ch. 10 - Problem 1-22A Product versus SGA costs The...Ch. 10 - Prob. 25PCh. 10 - Prob. 26PCh. 10 - Prob. 27PCh. 10 - Prob. 28PCh. 10 - Prob. 29PCh. 10 - Prob. 30PCh. 10 - Prob. 31PCh. 10 - Prob. 32PCh. 10 - Prob. 1ATCCh. 10 - Prob. 2ATCCh. 10 - Prob. 3ATCCh. 10 - Prob. 4ATCCh. 10 - Ethical Dilemma Product cost versus selling and...
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