MANAGERIAL ACCOUNTING >CUSTOM<W/AC SM21
16th Edition
ISBN: 9781264542062
Author: Garrison
Publisher: MCG CUSTOM
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Chapter 13, Problem 1F15
Cane Company manufactures two products called .Alpha and Beta that sell for $120 and $80: respectively. Each product uses only one type of raw material that costs $6 per pound. The company has the capacity7 to annually produce 100,000 units of each product. Its average cost per unit for each product at this level of activity are given below:
The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses are unavoidable and have been allocated to products based on sales dollars.
Required:
(Answer each question independently unless instructed otherwise.)
1. What is the total amount of traceable fixed manufacturing overhead for each of the two products?
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[The following information applies to the questions displayed below.)
Cane Company manufactures two products called Alpha and Beta that sell for $210 and $172, respectively. Each product
uses only one type of raw material that costs $8 per pound. The company has the capacity to annually produce 128,000
units of each product. Its average cost per unit for each product at this level of activity are given below:
Direct materials
Direct labor
Variable manufacturing overhead
Traceable fixed manufacturing overhead
Variable selling expenses
Common fixed expenses
Total cost per unit
Alpha
$ 40
38
25
33
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$ 199
Total contribution margin
Beta
$ 24
34
23
36
26
28
$ 171
The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses
are unavoidable and have been allocated to products based on sales dollars.
14. Assume that Cane's customers would buy a maximum of 98,000 units of Alpha and 78,000 units of Beta. Also assume that the raw
material…
[The following information applies to the questions displayed below.]
Cane Company manufactures two products called Alpha and Beta that sell for $240 and $162, respectively. Each product
uses only one type of raw material that costs $5 per pound. The company has the capacity to annually produce 131,000
units of each product. Its average cost per unit for each product at this level of activity are given below:
Direct materials
Direct labor
Variable manufacturing overhead
Traceable fixed manufacturing overhead
Variable selling expenses
Common fixed expenses
Total cost per unit
Alpha
$ 35
Beta
$ 15
48
23
27
25
35
38
32
28
35
30
$ 212
$ 159
The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses
are unavoidable and have been allocated to products based on sales dollars.
8. Assume that Cane normally produces and sells 80,000 Betas and 100,000 Alphas per year. If Cane discontinues the Beta product
line, its sales representatives…
[The following information applies to the questions displayed below.]
Cane Company manufactures two products called Alpha and Beta that sell for $210 and $172, respectively. Each product
uses only one type of raw material that costs $8 per pound. The company has the capacity to annually produce 128,000
units of each product. Its average cost per unit for each product at this level of activity are given below:
Direct materials.
Direct labor
Variable manufacturing overhead
Traceable fixed manufacturing overhead
Variable selling expenses
Common fixed expenses
Total cost per unit
Units produced
Alpha
$ 40
38
25
33
30
33
$ 199
The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses
are unavoidable and have been allocated to products based on sales dellars.
Alpha
Beta.
$ 24
34
13. Assume that Cane's customers would buy a maximum of 98,000 units of Alpha and 78,000 units of Beta. Also assume that the raw
material available for…
Chapter 13 Solutions
MANAGERIAL ACCOUNTING >CUSTOM<W/AC SM21
Ch. 13.A - EXERCISE 12A-1 Absorption Costing Approach to...Ch. 13.A - EXERCISE 12A-2 Customer Latitude and Pricing...Ch. 13.A - Prob. 3ECh. 13.A - Prob. 4ECh. 13.A - Prob. 5ECh. 13.A - EXERCISE 12A-6 Value-Based Pricing; Absorption...Ch. 13.A - Prob. 7ECh. 13.A - Prob. 8PCh. 13.A - Prob. 9PCh. 13.A - Prob. 10P
Ch. 13.A - Prob. 11PCh. 13.A -
PROBLEM 12A-12 Absorption Costing Approach to...Ch. 13.A - PROBLEM 12A-13 Value-Based Pricing LO12-10 The...Ch. 13 - Prob. 1QCh. 13 - Prob. 2QCh. 13 - Prob. 3QCh. 13 - Prob. 4QCh. 13 - “Variable costs and differential costs mean the...Ch. 13 - 12-6 "All future costs are relevant in decision...Ch. 13 - Prentice Company is considering dropping one of...Ch. 13 - Prob. 8QCh. 13 - 12-9 What is the danger in allocating common fixed...Ch. 13 - 12-10 How does opportunity cost enter into a make...Ch. 13 - 12-11 Give at least four examples of possible...Ch. 13 - 12-12 How will relating product contribution...Ch. 13 - Define the following terms: joint products, joint...Ch. 13 - 12-14 From a decision-making point of view, should...Ch. 13 - What guideline should be used in determining...Ch. 13 - Prob. 16QCh. 13 - Prob. 1AECh. 13 - Prob. 2AECh. 13 - Cane Company manufactures two products called...Ch. 13 - (
Alpha Beta
$30
$...Ch. 13 - Prob. 3F15Ch. 13 - Prob. 4F15Ch. 13 - Prob. 5F15Ch. 13 - (
Alpha Beta
$30
$...Ch. 13 - Prob. 7F15Ch. 13 -
Cane Company manufactures two products called...Ch. 13 - Prob. 9F15Ch. 13 - (
Alpha Beta
$30
$...Ch. 13 - Prob. 11F15Ch. 13 - Prob. 12F15Ch. 13 - (
Alpha ...Ch. 13 - (
Alpha Beta
$30
$...Ch. 13 - (
Alpha Beta
$30
$...Ch. 13 -
EXERCISE 12-1 Identifying Relevant Costs...Ch. 13 -
EXERCISE 12-2 Dropping or Retaining a Segment...Ch. 13 -
EXERCISE 12-3 Make or Buy Decision LO12-3
Troy...Ch. 13 -
EXERCISE 12-4 Special Order Decision...Ch. 13 -
EXERCISE 12-5 Volume Trade-Off Decisions...Ch. 13 - Prob. 6ECh. 13 - Prob. 7ECh. 13 - Prob. 8ECh. 13 - Prob. 9ECh. 13 - Prob. 10ECh. 13 - (
$3.60
10.00
2.40
9.00
$25.00
)
EXERCISE 12-11...Ch. 13 - Prob. 12ECh. 13 - EXERCISE 12-13 Sell or Process Further Decision...Ch. 13 - en
r
Ch. 13 - Prob. 15ECh. 13 - (
$150
31
20
29
3
24
15
$272
$34
)
EXERCISE...Ch. 13 - Prob. 17ECh. 13 - Prob. 18PCh. 13 - PROBLEM 12-19 Dropping or Retaining a Segment...Ch. 13 -
PROBLEM 12-20 Sell or Process Further Decision...Ch. 13 - Prob. 21PCh. 13 - PROBLEM 12-22 Special Order Decisions LO12-4...Ch. 13 -
PROBLEM 12-23 Make or Buy Decision LO12-3
Silven...Ch. 13 - Prob. 24PCh. 13 - Prob. 25PCh. 13 - Prob. 26PCh. 13 - Prob. 27PCh. 13 - Prob. 28PCh. 13 - CASE 12-29 Sell or Process Further Decision LO12-7...Ch. 13 -
CASE 12-30 Ethics and the Manager; Shut Dora or...Ch. 13 - CASE 12-31 Integrative Case: Relevant Costs;...Ch. 13 -
CASE 12-32 Make or Buy Decisions; Volume...Ch. 13 - Prob. 33C
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