%24 %24 %24 %24 Carla Vista Products Company uses a job order cost system. For a number of months, there has been an ongoing rift between the sales department and the production department concerningaspecial-order product, TC-1 TC-1 is a seasonal product that is manufactured in batches of 1,000 units. TC-Lis sold at cost plus a markup of 40% of cost. The sales department is unhappy because fluctuating unit production costs significantly affect selling prices. Sales personnel complain that this has caused excessive customer complaints and the loss of considerable orders for TC-1. The production department maintains that each job order must be fully costed on the basis of the costs incurred during the period in which the goods are produced. Production personnel maintain that the only real solution is for the sales department to increase sales quantities in the slack periods. Andrea Parley, president of the company, asks you as the company accountant to collect quarterly data for the past year on TC-1. From the cost accounting system, you accumulate the following production quantity and cost data. Quarter 3. 4. 1. 2. Direct materials $259,600 $94,400 000'9 Direct labor 155,760 141,600 Manufacturing overhead 180,540 114,460 147,500 006' Total $312,700 2265,500 $525,100 Production in batches 5. Unit cost (per batch) $62,540 065'6 $53,100 $52,510 Restate the quarterly data by applying overhead as a set rate per batch. Quarter Costs 1. Direct materials Direct labor Manufacturing overhead Applied Production in batches Unit cost (per batch) eTextbook and Media Attenpts O of 3 used Submit Anwer
%24 %24 %24 %24 Carla Vista Products Company uses a job order cost system. For a number of months, there has been an ongoing rift between the sales department and the production department concerningaspecial-order product, TC-1 TC-1 is a seasonal product that is manufactured in batches of 1,000 units. TC-Lis sold at cost plus a markup of 40% of cost. The sales department is unhappy because fluctuating unit production costs significantly affect selling prices. Sales personnel complain that this has caused excessive customer complaints and the loss of considerable orders for TC-1. The production department maintains that each job order must be fully costed on the basis of the costs incurred during the period in which the goods are produced. Production personnel maintain that the only real solution is for the sales department to increase sales quantities in the slack periods. Andrea Parley, president of the company, asks you as the company accountant to collect quarterly data for the past year on TC-1. From the cost accounting system, you accumulate the following production quantity and cost data. Quarter 3. 4. 1. 2. Direct materials $259,600 $94,400 000'9 Direct labor 155,760 141,600 Manufacturing overhead 180,540 114,460 147,500 006' Total $312,700 2265,500 $525,100 Production in batches 5. Unit cost (per batch) $62,540 065'6 $53,100 $52,510 Restate the quarterly data by applying overhead as a set rate per batch. Quarter Costs 1. Direct materials Direct labor Manufacturing overhead Applied Production in batches Unit cost (per batch) eTextbook and Media Attenpts O of 3 used Submit Anwer
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Unit v question 12
Transcribed Image Text:%24
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Carla Vista Products Company uses a job order cost system. For a number of months, there has been an ongoing rift between the sales
department and the production department concerningaspecial-order product, TC-1 TC-1 is a seasonal product that is manufactured
in batches of 1,000 units. TC-Lis sold at cost plus a markup of 40% of cost.
The sales department is unhappy because fluctuating unit production costs significantly affect selling prices. Sales personnel complain
that this has caused excessive customer complaints and the loss of considerable orders for TC-1.
The production department maintains that each job order must be fully costed on the basis of the costs incurred during the period in
which the goods are produced. Production personnel maintain that the only real solution is for the sales department to increase sales
quantities in the slack periods.
Andrea Parley, president of the company, asks you as the company accountant to collect quarterly data for the past year on TC-1. From
the cost accounting system, you accumulate the following production quantity and cost data.
Quarter
3.
4.
1.
2.
Direct materials
$259,600
$94,400
000'9
Direct labor
155,760
141,600
Manufacturing overhead
180,540
114,460
147,500
006'
Total
$312,700
2265,500
$525,100
Production in batches
5.
Unit cost (per batch)
$62,540
065'6
$53,100
$52,510
Restate the quarterly data by applying overhead as a set rate per batch.
Quarter
Costs
1.
Direct materials
Direct labor
Manufacturing overhead Applied
Production in batches
Unit cost (per batch)
eTextbook and Media
Attenpts O of 3 used Submit Anwer
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