Activity-Based Supplier Costing Clearsound uses Alpha Electronics and La Paz Company to buy two electronic components used in the manufacture of its cell phones: Component 125X and Component 30Y. Consider two activities: testing components and reordering components. After the two components are inserted, testing is done to ensure that the two components in the phones are working properly. Reordering occurs because one or both of the components have failed the test and it is necessary to replenish component inventories Activity cost information and other data needed for supplier costing are as follows: I. Activity Costs Caused by Suppliers (testing failures and reordering as a result) Activity Costs Testing components $1,200,000 Reordering components 300,000 II. Supplier Data Alpha Electronics La Paz Company 125X 30Y 125X 30Y Unit purchase price $10 $26 $12 $28 Units purchased 120,000 80,300 15,000 15,000 Failed tests 1,300 780 10 10 Number of reorders 60 40 Required: Determine the cost of each supplier by using ABC. Round Test and Reorder rates to the nearest dollar, and final answers to the nearest cent. Alpha Electronics La Paz Company 125X 30Y 125X 30Y Unit cost: X

Activity-Based Supplier Costing Clearsound uses Alpha Electronics and La Paz Company to buy two electronic components used in the manufacture of its cell phones: Component 125X and Component 30Y. Consider two activities: testing components and reordering components. After the two components are inserted, testing is done to ensure that the two components in the phones are working properly. Reordering occurs because one or both of the components have failed the test and it is necessary to replenish component inventories Activity cost information and other data needed for supplier costing are as follows: I. Activity Costs Caused by Suppliers (testing failures and reordering as a result) Activity Costs Testing components $1,200,000 Reordering components 300,000 II. Supplier Data Alpha Electronics La Paz Company 125X 30Y 125X 30Y Unit purchase price $10 $26 $12 $28 Units purchased 120,000 80,300 15,000 15,000 Failed tests 1,300 780 10 10 Number of reorders 60 40 Required: Determine the cost of each supplier by using ABC. Round Test and Reorder rates to the nearest dollar, and final answers to the nearest cent. Alpha Electronics La Paz Company 125X 30Y 125X 30Y Unit cost: X

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Required:(a) Compute the equivalent units for direct materials (From Moulding & Direct materialsadded) and conversion costs.(b) Compute the: Cost per equivalent unit for direct materials and conversion costs Total cost of the skis completed and transferred out to the Packing Department. Cost of the unexpected losses Cost of ending work in process inventory in the Spraying Department.
Joint Cost Allocation-Weighted Average Method Konami Code Gaming produces two types of high-end gaming controllers, one with a casing made of a polymer that looks like walnut wood and another with a casing made with a polymer that looks like red oak. The casings are made through a joint production molding process that produces 294 red oak casings and 252 walnut casings at the split-off point. The polymer for the red oak casings requires twice as much cooling time as the polymer for the walnut casings, although all casings are removed from the joint molding process at the same time (i.e., once the cooling for the red oak casings is complete). The joint production process costs a total of $5,000. Assuming the company allocates joint costs using the weighted average method based on the required cooling time of the two joint products, determine the amount of joint production costs allocated to each type of casing using the weighted average method. Joint Product Red oak casing Walnut casing…
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JT Engineering makes widgets. Widgets first go through Smelting and then go through Polishing. JT has decided to do away with the polishing step, electing to sell unpolished widgets to its customers. How will this process modification impact JT's manufacturing costs and flow of costs? O It will decrease manufacturing costs and eliminate the need for Work in Process accounts. O It will increase manufacturing costs and eliminate the need for Work in Process accounts. O It will decrease manufacturing costs and eliminate the need for a Work in Process-Polishing account. O It will increase manufacturing costs and eliminate the need for a Work in Process-Polishing account.
Hall, Incorporated manufactures two components, Standard and Ultra, that are designed for the same function, but are made of different metals for operational performance reasons. The metal used in Standard is easy to work with and there are few quality issues or reworking required on the machines. The metal used in Ultra is more difficult to work with and often needs additional machine time and rework. Data on expected operations and direct costs for the next fiscal year follow: Account Administration Engineering Machine operation and maintenance Standard Miscellaneous Supervision Total 48,000 144,000 24,000 Ultral $ 3,384,000 2,520,000 Units produced Direct labor-hours used Machine-hours used Direct materials costs $5,163,000 Direct labor costs 855,000 The planning process team at Hall, Incorporated has estimated the following manufacturing overhead costs for the next fiscal year: 16,500 22,500 22,500 Total Amount $ 825,400 5,699,500 875,000 540,100 884,500 $8,824,500. 64,500 166,500…
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