E7.18 (LO 1, 2, 3, 4, 5, 6), C The costs listed below relate to a...
E7.18 (LO 1, 2, 3, 4, 5, 6), C The costs listed below relate to a variety of different decision situations. Identify relevant costs for different decisions. Cost Decision 1. Unavoidable fixed overhead Eliminate an unprofitable segment 2. Direct labor Make or buy 3. Original cost of old equipment Equipment replacement 4. Joint production costs Sell or process further 5. Opportunity cost Accepting a special order 6. Segment manager’s salary Eliminate an unprofitable segment (manager will be terminated) 7. Cost of new equipment Equipment replacement 8. Incremental production costs Sell or process further 9. Direct materials Equipment replacement (the amount of materials required does not change) 10. Rent expense Purchase or lease a building Instructions For each cost listed above, indicate if it is relevant or not to the related decision. For those costs determined to be irrelevant, briefly explain why.
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E7.18 (LO 1, 2, 3, 4, 5, 6), C The costs listed below relate to
a...
1. The following costs relate to a variety of decision settings: Cost Decision 1. Allocated corporate...
1. The following costs relate to a variety of decision settings: Cost Decision 1. Allocated corporate overhead Closing a money-losing department 2. Cost of an old car Vehicle replacement 3. Direct materials Make or buy a product 4. Salary of marketing manager Project discontinuance; manager to be transferred elsewhere in the firm 5. Home theater installation Purchase of a new home 6. Unavoidable fixed overhead Plant closure 7. Research expenditures incurred last year, related to new product Product introduction to...
A. Management's Decision-Making Process. 1. The steps are: a. b. c. d. 2. Accounting's contribution to...
A. Management's Decision-Making Process. 1. The steps are: a. b. c. d. 2. Accounting's contribution to the decision-making process occurs primarily in what steps? B. Incremental Analysis. 1. 2. 3. Incremental analysis sometimes involves changes that might seem contrary to your intuition. For example, sometimes: a. b. Accept an order at a special price. 4. a. b. c. a. 5. Make or buy. In a make or buy decision, the relevant costs are: (1) (2) (3) 6. Sell or process...
1) When making Managerial decisions, explain what financial and non-financial information is involved in the decision...
1) When making Managerial decisions, explain what financial and non-financial information is involved in the decision making process? 2) Explain the following concepts utilized in Incremental Analysis--Relevant Costs, Opportunity Costs and Sunk Costs? 3) What is the purpose of incremental analysis used by a company? 4) Why do we only look at relevant costs in accepting or rejecting a special order at a set price? What assumptions are made in this decision-making process? 5) What factors do we look at...
Please answer all the question!!! 5. When will the elimination overall profit? a. When the b. When th of a product line have no effect on the company's avoidable fixed costs equal the product...
Please answer all the question!!!
5. When will the elimination overall profit? a. When the b. When th of a product line have no effect on the company's avoidable fixed costs equal the product line's contribution margin e unavoidable fixed costs equal the product line's contribution margin d when there are no fixed costs incurred by the product line d. When the product line contribution margi n is negative 6. All of the following are relevant to the sell or...
M7-2 Identifying Steps in the Decision-Making Process [LO 7-1] Listed below are a number of activities managers may per...
M7-2 Identifying Steps in the Decision-Making Process [LO 7-1] Listed below are a number of activities managers may perform. Identify which of these activities are steps in management's decision-making process. 3. Decision-Making Process 5. Non Decision-Making Process 1. Analyze how changes in cost structure affect CVP relationships. 2. Make the decision. Eliminate the product line. Evaluate the costs and benefits of the alternatives. Prioritize products to maximize short-term profits. Determine the decision alternatives. 7. Process the product further. Review the...
24. Which of the following costs are variable? 10,000 Units 30,000 Units $100,000 40,000 90,000 50,000 Cost $300,000 240,000 90,000 150,000 2. 4. A) only 2 B) only 1 C) 1 and 2 D) 1 and4 25. Ed...
24. Which of the following costs are variable? 10,000 Units 30,000 Units $100,000 40,000 90,000 50,000 Cost $300,000 240,000 90,000 150,000 2. 4. A) only 2 B) only 1 C) 1 and 2 D) 1 and4 25. Eddy Company is starting business and is unsure of whether to sell its product assembled or unassembled. The unit cost of the unassembled product is $60 and Eddy Company would sell it for $135. The cost to assemble the product is estimated at...
Kindly provide an explanation as to what are the main concepts pertaining to arriving at relevant...
Kindly provide an explanation as to what are the main concepts pertaining to arriving at relevant costing and discuss how these principles might apply to a manufacturing company. Answer: A relevant cost is a current or future cost that will differ among alternatives. For example, relevant cost of material is the raw material cost that needs to be considered while taking a managerial decision. Relevant cost of material may be in the form of incremental cash flows or opportunity cost....
Knowledge Check 01 Which of the following factors should be considered when deciding whether to keep...
Knowledge Check 01 Which of the following factors should be considered when deciding whether to keep a product line or drop it? (Select all that apply) Check All That Apply 0 Opportunity costs of using the production facility currently being used for the product line 0 Revenues generated by the product line 0 Variable costs incurred in manufacturing the product 0 Direct fixed costs associated with the product line 0 Common fixed costs allocated to the product line Check All...
16sb Please show full calculation, TIA! ---- 1. ABC Company produces a product that currently sells...
16sb Please show full calculation, TIA! ---- 1. ABC Company produces a product that currently sells for $72 per unit. Current production costs per unit include the following: Direct materials = $20 Variable overhead = $10 Direct labor = $24 Fixed overhead = $10 Total production costs = $64 ABC has received a special pricing offer from a nonprofit organization to buy 3,000 units at $60 per unit. ABC is currently operating at full production capacity. Identify...
Exercise 14-5 Classifying manufacturing costs LO C2 Selected costs related to Apple's iPhone are listed below....
Exercise 14-5 Classifying manufacturing costs LO C2 Selected costs related to Apple's iPhone are listed below. Identify each cost as either direct materials, direct labor, factory overhead, selling expenses, or general and administrative expenses by selecting the appropriate dropdowns. 1. Quality control supervisor salary 2. Uniforms provided for each factory worker 3. Depreciation on office equipment 4. Display screen 5. Camera 6. Advertising campaigns Maintenance of assembly equipment 8. Wages for retail store worker
A. Management's Decision-Making Process. 1. The steps are: a. b. c. d. 2. Accounting's contribution to the decision-making process occurs primarily in what steps? B. Incremental Analysis. 1. 2. 3. Incremental analysis sometimes involves changes that might seem contrary to your intuition. For example, sometimes: a. b. Accept an order at a special price. 4. a. b. c. a. 5. Make or buy. In a make or buy decision, the relevant costs are: (1) (2) (3) 6. Sell or process...
Please answer all the question!!!
5. When will the elimination overall profit? a. When the b. When th of a product line have no effect on the company's avoidable fixed costs equal the product line's contribution margin e unavoidable fixed costs equal the product line's contribution margin d when there are no fixed costs incurred by the product line d. When the product line contribution margi n is negative 6. All of the following are relevant to the sell or...
M7-2 Identifying Steps in the Decision-Making Process [LO 7-1] Listed below are a number of activities managers may perform. Identify which of these activities are steps in management's decision-making process. 3. Decision-Making Process 5. Non Decision-Making Process 1. Analyze how changes in cost structure affect CVP relationships. 2. Make the decision. Eliminate the product line. Evaluate the costs and benefits of the alternatives. Prioritize products to maximize short-term profits. Determine the decision alternatives. 7. Process the product further. Review the...
24. Which of the following costs are variable? 10,000 Units 30,000 Units $100,000 40,000 90,000 50,000 Cost $300,000 240,000 90,000 150,000 2. 4. A) only 2 B) only 1 C) 1 and 2 D) 1 and4 25. Eddy Company is starting business and is unsure of whether to sell its product assembled or unassembled. The unit cost of the unassembled product is $60 and Eddy Company would sell it for $135. The cost to assemble the product is estimated at...
Knowledge Check 01 Which of the following factors should be considered when deciding whether to keep a product line or drop it? (Select all that apply) Check All That Apply 0 Opportunity costs of using the production facility currently being used for the product line 0 Revenues generated by the product line 0 Variable costs incurred in manufacturing the product 0 Direct fixed costs associated with the product line 0 Common fixed costs allocated to the product line Check All...
Exercise 14-5 Classifying manufacturing costs LO C2 Selected costs related to Apple's iPhone are listed below. Identify each cost as either direct materials, direct labor, factory overhead, selling expenses, or general and administrative expenses by selecting the appropriate dropdowns. 1. Quality control supervisor salary 2. Uniforms provided for each factory worker 3. Depreciation on office equipment 4. Display screen 5. Camera 6. Advertising campaigns Maintenance of assembly equipment 8. Wages for retail store worker
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