5. In connection with surfacing a new highway, a contractor has a choice of two sites on which to set up the mixing plant equipment. The contractor estimates that it will cost P51.75 per cubic meter per kilometer to haul the asphalt paving material from the mixing plant to the job site. If site B is selected, there will be an added charge of P600 per day for a flagman and it needs 2 flagman. The job requires 50,000 cubic meters of mixed asphalt paving material. It is estimated that four months (17 weeks of five working days per week) will be required for the job Cost Factors Site A Site B 4.3 km Average hauling distance 6 km Monthly rental of site P45,000 P225,000 Cost to setup and remove equipment P675,000 Hauling expense P51.75 / Cu.m/km P1,125,000 P51.75 / Cu.m/km

Q: Define a fixed against a variable cost and give an example of each?

A: A fixed cost is a cost that does not change with the level of output or activity in a business. It…

Q: Explain the difference between total variable costs and variable costs per unit.

A: Cost can be categorized as variable and fixed costs.

Q: 6) Define fixed, variable

A: Answer: Fixed cost A fixed cost is a value that doesn't modification over the short, although a…

Q: What is cost-allocation base? Give three examples?

A: Costing: Costing is a technique used in cost accounting to determine the cost of a product. With the…

Q: Define initial direct costs.

A: Initial direct cost: A cost that is incurred during the process of initiating the agreement of lease…

Q: A company purchases currency futures to respond to currency risk. However, due to increasing…

A: Solution: A company purchases currency futures to respond to currency risk. However, due to…

Q: Define and explain the contribution margin.  Include the difference in fixed and variable costs in…

A: Contribution margin may be defined as the amount of profit generated when only the cost of goods…

Q: Distinguish between two methods of allocating common costs.

A: Cost Allocation Method: The cost allocation method is the method by which the costs to be assigned…

Q: Given the following, the only item that will generally be included in relevant cost analysis is:…

A: Introduction:   The phrase "relevant cost" in managerial accounting refers to avoidable costs that…

Q: Distinguish between the single-rate and the dual-rate methods. The single-rate (cost-allocation)…

A: Cost Allocation: The process of assigning the cost to the cost object is cost allocation. The cost…

Q: Define variable cost and fixed cost. Give an example of each?

A: Variable Cost: Variable cost refers the cost which varies due to the change in the level of…

Q: Select all of the following that are the same as a relevant cost: unavoidable cost Oavoidable cost…

A: Relevant cost is a cost that is specifically relevant to a particular decision being made. It is a…

Q: The controller of Sheridan Industries has collected the following monthly expense data for use in…

A: The high-low method is a cost analysis technique that calculates the variable and fixed components…

Q: How are joint costs allocated? Explain and analyze using numerical example.

A: Joint Costs In business different costs are incurred in the production process, but in certain…

Q: Please explain the calculation of Unit contribution

A: Unit Contribution margin is contribution margin earned per unit It is calculated in 2 ways  Unit…

Q: Explain an example of fixed cost.

A: Cost:   It is the economic value of resources incurred by an organization for producing a product or…

Manufacturing Costs

Manufacturing cost is the total cost of procuring or producing a product. In other words, the manufacturing cost is the cost that an individual or business owner undertakes for the manufacturing of goods.