Which of the following cost reduction techniques focuses on nonvalue-added activities as a measure to reduce...
Wave Crest Cosmetics produces cosmetic products for 11 major buyers. One customer accounts for ½ of the sales, the other 10 customers account for the remaining sales. The 10 smaller customers place orders of about equal size. The large customer purchases 1,000,000 units per year by placing 3 orders per year, and the 10 smaller customers order 1,000,000 units in total by placing 400 orders per year. Order filling costs total $685,100 per year. How much would be assigned to...
Wave Crest Cosmetics produces cosmetic products for 11 major buyers. One customer accounts for of the sales, the other 10 customers account for the remaining sales. The 10 smaller customers place orders of about equalse, The large customer purchases 1,000,000 units per year by placing orders per year, and the 10 smaller customers order 1,000,000 units in total by placing 300 orders per year. Ordering costs total $518,500 per year. How much would be assigned to the large customer as...
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 28,500 $24 Assembly Labor hours 117,000 142,500 1 7...
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 20x1 (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 12,000 18,000 $21 Assembly Labor hours 75,000 90,000 15 Expediting Orders...
Cornerstone Exercise 12.1 (Algorithmic) 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 7,200 19,500 $12 Assembly Labor hours 81,000 ...
The following activities occur at Greenwich Corporation, a company that manufactures a variety of products. Advanced Products Corporation has supplied the following data from its activity-based costing system: Overhead Costs Wages and salaries Other overhead costs Total overhead costs $ 300,000 100,000 $ 400,000 Activity Cost Pool Supporting direct labor Order processing Customer support Other Activity Measure Number of direct labor-hours Number of customer orders Number of customers This is an organization- sustaining activity Total Activity for the Year 20,...
Activity-Based Management, Nonvalue-Added Costs Danna Martin, president of Mays Electronics, was concerned about the end-of-the year marketing report that she had just received. According to Larry Savage, marketing manager, a price decrease for the coming year was again needed to maintain the company's annual sales volume of integrated circuit boards (CBs). This would make a bad situation worse. The current selling price of $18 per unit was producing a $2-per-unit profit—half the customary $4-per-unit profit. Foreign competitors kept reducing their...
Trend Reporting for Non-Value Added Costs 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 20x1 (actual price per unit of the activity driver is assumed to be equal to the standard price): Activity Activity Driver SQAQ SP Receiving Receiving orders 10,400 22,500 $18 Assembly Labor hours 93,000 112,500 13 Expediting Orders...
Advanced Products Corporation has supplied the following data from its activity-based costing system: Overhead Costs Wages and salaries Other overhead costs Total overhead costs $ 300,000 100,000 $ 400,000 Activity Cost Pool Supporting direct labor Order processing Customer support Other Activity Measure Number of direct labor-hours Number of customer orders Number of customers This is an organization- sustaining activity Total Activity for the Year 20,000 DLHS 400 orders 200 customers Not applicable Distribution of Resource Consumption Across Activities Supporting Order...
Exercise 7-16 Comprehensive Activity-Based Costing Exercise [LO2, LO3, LO4] Cancico Communications has supplied the following data for use in its ABC system: Overhead Costs Wages and salaries $ 295,000 Other overhead costs 163,000 Total overhead costs $ 458,000 Activity Cost Pool Activity Measure Total Activity Direct labour support Number of direct labour-hours 12,110 DLHs Order processing Number of orders 500 orders Customer support Number of customers 120 customers Other These costs are not allocated to products or customers NA Distribution...