Homework Answers
Solution:-
Non-value added cost refers to the cash and cash equivalents
which are incurred due to the non-value activities or by the
ineffective presentation of value-added activities.
Only the value of actual quantity is given in the problem that is
$740,000. Therefore, the value of non-value added cost of reworking
activity is $740,000.
Use the following formula to calculate the non-value added cost
of purchasing activity:
Non-value added cost = (Actual quantity - value added quantity) *
Cost per purchase order
Substitute, 45,000 purchasing hours for each quantity, purchasing
hours for value added quantity and $20 for cost per purchase
order.
= (45,000 - 24,000) * 20
= 420,000.
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Evans Inc. has the following the activities: (1) Reworking products, cost $40,000. The reworking cost of...
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CO Wonvalue Added Costs Evans Inc. has the following two activities: (1) Reworking products, cost: $740,000. The reworking cost of the most competitor is $200,000. (2) Purchasing parts, cost: $900,000 (45,000 purchasing hours). A benchmarking study rey efficient level for Evans would use 24,000 purchasing hours and entail a cost of $450,000. Required: Hetermine the nonvalue-added cost of each activity. Reworking Purchasing $ 393,750 x Jonvalue-added cost: $ 5,437,50 X Feedback Check My Work Nonvalue-added costs are caused either by...
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CO Wonvalue Added Costs Evans Inc. has the following two activities: (1) Reworking products, cost: $740,000. The reworking cost of the most competitor is $200,000. (2) Purchasing parts, cost: $900,000 (45,000 purchasing hours). A benchmarking study rey efficient level for Evans would use 24,000 purchasing hours and entail a cost of $450,000. Required: Hetermine the nonvalue-added cost of each activity. Reworking Purchasing $ 393,750 x Jonvalue-added cost: $ 5,437,50 X Feedback Check My Work Nonvalue-added costs are caused either by...
5.7 Brief Exercise 5-27 Nonvalue Added Costs Lemmons Inc. has the following two activities: (1) Retesting reworked products, con $720,000. The retesting cost of the most efficient competitor is $225,000. (2) Welding sub assemblies, cost: $1,350,000 (67,500 welding hours). A benchmarking study reveals that the most efficient level for Lemmons would use 54,000 welding hours and entail a cost of $1,080,000. Required: Determine the nonvalue-added cost of each activity.
eBook Show Me How Calculator Nonvalue-Added Costs Lemmons Inc. has the following two activities: (1) Retesting reworked products, cost: $720,000. The retesting cost of the most efficient competitor is $225,000. (2) Welding subassemblies, cost: $1,350,000 (67,500 welding hours). A benchmarking study reveals that the most efficient level for Lemmons would use 54,000 welding hours and entail a cost of $1,080,000. Required: Determine the nonvalue-added cost of each activity. Welding Retesting $ 480,000 x Nonvalue-added cost: Feedback Check My Work Nonvalue-added...
Norvalue Added Costs Lemmons Inc. has the following two activities: (1) testing reworked products, cost $479.000. The resting cont of the most efficient competitor is $225.000. (2) Welding subassemblies, cost $742,500 (67.500 welding hours). A benchmarang study reveals that the most efficient level for Lammon would use 54,000 welding hours and antalla cost of $394,000 Required: Determine the nonvalue-added cost of each activity Retesting Welding Nova added :
Cost Report, Value Added and Non-Value Added Costs Sanford, Inc., has developed value-added standards for four activities: purchasing parts, receiving parts, moving parts, and setting up equipment. The activities, the activity drivers, the standard and actual quantities, and the price standards for 20x1 are as follows: Activities Activity Driver Purchasing parts Receiving parts Purchase orders Receiving orders Number of moves Setup hours SQ AQ SP 3,100 4,570 $255 6,200 8,500 245 0 2,700 380 0 9,500395 Moving parts Setting up...
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...
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