Assume that the company employs a target costing approach and that the going rate for doggy day care is $11 per hour. What is the target cost per dog hour if the two friends require a 25% return on their invested assets, which total $520,000 (including Jennifer's home)? (Round answer to 2 decimal places, e.g. 15.25.) Target cost per dog hour Estimated cost per dog hour $ Target cost per dog hour $ $ per dog hour per dog hour How would the target cost and estimated cost per dog hour change if a more accurate estimate of volume is just 10 dogs per day? (Round target cost per dog hour to 2 decimal places, e.g. 15.25 and estimated cost per dog hour to 3 decimal places, e.g. 15.256.) per dog hour
Assume that the company employs a target costing approach and that the going rate for doggy day care is $11 per hour. What is the target cost per dog hour if the two friends require a 25% return on their invested assets, which total $520,000 (including Jennifer's home)? (Round answer to 2 decimal places, e.g. 15.25.) Target cost per dog hour Estimated cost per dog hour $ Target cost per dog hour $ $ per dog hour per dog hour How would the target cost and estimated cost per dog hour change if a more accurate estimate of volume is just 10 dogs per day? (Round target cost per dog hour to 2 decimal places, e.g. 15.25 and estimated cost per dog hour to 3 decimal places, e.g. 15.256.) per dog hour
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
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Transcribed Image Text:Assume that the company employs a target costing approach and that the going rate for doggy day care is $11 per hour. What is
the target cost per dog hour if the two friends require a 25% return on their invested assets, which total $520,000 (including
Jennifer's home)? (Round answer to 2 decimal places, e.g. 15.25.)
Target cost per dog hour
(c)
Estimated cost per dog hour
Target cost per dog hour $
eTextbook and Media
How would the target cost and estimated cost per dog hour change if a more accurate estimate of volume is just 10 dogs per day?
(Round target cost per dog hour to 2 decimal places, e.g. 15.25 and estimated cost per dog hour to 3 decimal places, e.g. 15.256.)
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$
Selling price
$
$
per dog hour
per dog hour
/dog hour
per dog hour
If the company employs a cost-plus markup of 30%, assuming the original volume of 26 dogs per day, what will be the selling price
per dog hour? (Round answer to 2 decimal places, e.g. 15.25.)
Attempts: 0 of 3 used
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Transcribed Image Text:Jennifer and David are considering offering a doggy day-care service. After some research, they found several pet day-care facilities in
their area, but they were expensive! Further, the facilities were sterile and didn't provide a "homey" or fun environment for pets.
Jennifer and David felt they could easily fix these shortcomings.
Jennifer's home would be the location for their business, since it already has a fenced-in yard and is located two blocks from a dog
park. Estimated costs for building an outdoor shelter, plus other licensing and business start-up costs, are as follows.
Shelter (depreciated over 7 years)
Licensing and other annual costs
Hourly wage for hired labor; planned for only 210 hours per year
Variable costs for food
Estimated volume of dogs per day (open for business 5 days per week, 50
weeks per year; average length of stay 8 hours per day)
$600 per year
$700
per year
$14 per hour
$15 per day per dog
26 per day
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