In manufacturing its products, a company uses three raw materials A,B and C as follows: Raw Usage Reorder Price Delivery period in weeks Order Minimum materials per unit level quantity per kg. $ level A 10 1 to 2 10,000 5,000 10,000 10 8,000 4,750 B 4 30 3 to 5 6 15 2 to 4 2,000 Weekly production varies from 175 to 225 units, averaging 200. What would you expect the quantities of the following to be? (1) (I1) (III) Minimum stock of A; Maximum stock of B; and Average stock of A;

In manufacturing its products, a company uses three raw materials A,B and C as follows: Raw Usage Reorder Price Delivery period in weeks Order Minimum materials per unit level quantity per kg. $ level A 10 1 to 2 10,000 5,000 10,000 10 8,000 4,750 B 4 30 3 to 5 6 15 2 to 4 2,000 Weekly production varies from 175 to 225 units, averaging 200. What would you expect the quantities of the following to be? (1) (I1) (III) Minimum stock of A; Maximum stock of B; and Average stock of A;

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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Martinez Company’s relevant range of production is 7,500 units to 12,500 units. When it produces and sells 10,000 units, its average costs per unit are as follows: Average Cost per Unit Direct materials $ 5.50 Direct labor $ 3.00 Variable manufacturing overhead $ 1.50 Fixed manufacturing overhead $ 4.00 Fixed selling expense $ 2.50 Fixed administrative expense $ 2.00 Sales commissions $ 1.00 Variable administrative expense $ 0.50 6. If 12,500 units are produced and sold, what is the total amount of variable costs related to the units produced and sold? (Do not round intermediate calculations.)
Henry Company has established the following standards for the costs of one unit of its product. The standard production overhead costs per unit are based on direct-labor hours. Calculation for standard per unit cost is as follows: Std Cost Std Qty Std Price/Rate Direct Material $ 14.40 6.00 kg $ 2.40/kg Direct Labor $ 3.00 0.40 hour $ 7.50/hour Variable Overhead $ 4.00 0.40 hour $ 10.00/hour Fixed Overhead* $ 4.80 0.40 hour $ 12.00/hour Total $ 26.20 *based on practical capacity of 2,500 direct-labor hour per month During December 2020, Henry purchased 30,000 kg of direct material at a total cost of $75,000. The total wages for December were $20,000, 75% of which were for direct labor. Henry manufactured 4,500 units of product during December 2020, using 28,000kg of the direct material purchased in December and 2,100 direct-labor hours. Actual variable and fixed overhead cost were $23,100 and $25,000, respectively.…
Benoit Company produces three products—A, B, and C. Data concerning the three products follow (per unit): Product A B C Selling price $ 92.00 $ 66.00 $ 82.00 Variable expenses: Direct materials 27.60 18.00 12.00 Other variable expenses 27.60 31.50 45.40 Total variable expenses 55.20 49.50 57.40 Contribution margin $ 36.80 $ 16.50 $ 24.60 Contribution margin ratio 40% 25% 30% The company estimates that it can sell 950 units of each product per month. The same raw material is used in each product. The material costs $3 per pound with a maximum of 6,100 pounds available each month. Required: 1. Calculate the contribution margin per pound of the constraining resource for each product. 2. Which orders would you advise the company to accept first, those for A, B, or C? Which orders second? Third? 3. What is the maximum contribution margin that the company can earn per month if it makes optimal use of its 6,100 pounds of materials?
A company uses activity-based costing to calculate the unit cost of its products. The figures for Period 3 are as follows: Production set-up costs: £84,000. Total production is 40,000 units of each of products A and B, and each run is 2,000 units of A or 5,000 units of B. What is the set-up cost per unit of B? A. £0.10 B. £0.08 C. £0.60 D. £0.29
A company uses activity-based costing. The company makes two products: A and B. The annual production and sales of A is 400 units at $70 per unit and of B is 200 units at $90 per unit. Direct period costs are $3.000 for each product. There are three activity cost pools, with total allocated cost are as follows: Activity Cost Pools A B. Total Cost Activity 1 Activity 2 Activity 3 $4,280 $2,380 $6,660 1,275 7,175 8,450 2,654 6,877 १531 If the total of direct materials and direct labor costs for Product A is $20,000, the product margin for Product A is: (Enter a number in the box, use a negative sign for a product margin loss) $
Subject: Accounting
Martinez Company's relevant range of production is 7,500 units to 12,500 units. When it produces and sells 10,000 units, its average costs per unit are as follows: Average Cost Per Unit Direct materials $ 6.00 Direct labor $ 3.50 Variable manufacturing overhead $ 1.50 Fixed manufacturing overhead $ 4.00 Fixed selling expense $ 3.00 Fixed administrative expense $ 2.00 Sales commissions $ 1.00 Variable administrative expense $ 0.50 Foundational 1-6 (Static) 6. If 12,500 units are produced and sold, what is the total amount of variable costs related to the units produced and sold?
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Martinez Company’s relevant range of production is 7,500 units to 12,500 units. When it produces and sells 10,000 units, its average costs per unit are as follows: Average Cost per Unit Direct materials $ 5.50 Direct labor $ 3.00 Variable manufacturing overhead $ 1.50 Fixed manufacturing overhead $ 4.00 Fixed selling expense $ 2.50 Fixed administrative expense $ 2.00 Sales commissions $ 1.00 Variable administrative expense $ 0.50 3. If 8,000 units are produced and sold, what is the variable cost per unit produced and sold? (Round your answer to 2 decimal places.)
Martinez Company's relevant range of production is 7,500 units to 12,500 units. When it produces and sells 10,000 units, its average costs per unit are as follows: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Fixed selling expense Fixed administrative expense Sales commissions Variable administrative expense Average Cost Per Unit $6.20 $ 3.70 $ 1.60 $ 4.00 $3.20 $ 2.20 $ 1.20 $ 0.45 Foundational 1-3 (Algo) 3. If 8,000 units are produced and sold, what is the variable cost per unit produced and sold? Note: Round your answer to 2 decimal places.
A company makes two products—Product A and B. Data regarding the two products follow: Direct Labor-Hours per Unit Annual Production Product A 0.75 20,000 units Product B 0.50 50,000 units Additional information is as follows: Product A requires $40 in direct materials per unit, and Product B requires $32. The direct labor wage rate is $18 per hour. The company’s activity-based absorption costing system has the following activity cost pools: Activity Cost Pool (and Activity Measures) Estimated Overhead Cost Expected Activity Product A Product B Total Machine setups (number of setups) $ 100,000 100 300 400 Special processing (machine-hours) $ 200,000 2,000 6,000 8,000 General factory (Direct labor-hours) $ 150,000 15,000 25,000 40,000
Stargate Corporation has established the following standards for the costs of one unit of its product. The standard production overhead costs per unit are based on direct-labor hours. Calculation for standard per unit cost is as follows: Std Cost Std Qty Std Price/Rate Direct Material $ 14.40 6.00 kg $ 2.40 per kg Direct Labor $ 3.00 0.40 hour $ 7.50 per hour Variable Overhead $ 4.00 0.40 hour $ 10.0 per hour Fixed Overhead $ 4.80 0.40 hour $ 12.0 per hour Total $ 26.20 *based on practical capacity of 2,500 direct-labor hour per month During December 2020, Henry purchased 30,000 kg of direct material at a total cost of $75,000. The total wages for December were $20,000, 75% of which were for direct labor. Henry manufactured 4,500 units of product during December 2020, using 28,000kg of the direct material purchased in December and 2,100 direct-labor hours. Actual variable and fixed overhead cost were $23,100…