Jobs, Inc. has recently started the manufacture of Tri-Robo, a three-wheeled robot that can scan a home for fires and gas leaks andthen transmit this information to a smartphone. The cost structure to manufacture 20,000 Tri-Robos is as follows.Direct materials ($50 per robot)Direct labor ($40 per robot)Variable overhead ($6 per robot)Allocated fixed overhead ($30 per robot)TotalCost(a1)$1,000,000800,000120,000600,000$2,520,000Jobs is approached by Tienh Inc., which offers to make Tri-Robo for $115 per unit or $2,300,000.Following are independent assumptions.Assume that $405,000 of the fixed overhead cost can be avoided. (Enter negative amounts using either a negative signMAWPsXfE Jobs, Inc. has recently started the manufacture of Tri-Robo, a three-wheeled robot that can scan a home for fires and gas leaks andthen transmit this information to a smartphone. The cost structure to manufacture 20,000 Tri-Robos is as follows.Direct materials ($50 per robot)Direct labor ($40 per robot)Variable overhead ($6 per robot)Allocated fixed overhead ($30 per robot)TotalCost(a1)$1,000,000800,000120,000600,000$2,520,000Jobs is approached by Tienh Inc., which offers to make Tri-Robo for $115 per unit or $2,300,000.Following are independent assumptions.Assume that $405,000 of the fixed overhead cost can be avoided. (Enter negative amounts using either a negative signMAWPsXfE

This question is related to the Make and Buy Decision, in which the cost manager compares the making…

Jobs, Inc. has recently started the manufacture of Tri-Robo, a three-wheeled robot that can scan a home for fires and gas leaks and then transmit this information to a smartphone. The cost structure to manufacture 20,000 Tri-Robos is as follows. Direct materials ($50 per robot) Direct labor ($40 per robot) Variable overhead ($6 per robot) Allocated fixed overhead ($30 per robot) Total Cost (a1) $1,000,000 800,000 120,000 600,000 $2,520,000 Jobs is approached by Tienh Inc., which offers to make Tri-Robo for $115 per unit or $2,300,000. Following are independent assumptions. Assume that $405,000 of the fixed overhead cost can be avoided. (Enter negative amounts using either a negative sign LEU A W P

Jobs, Inc. has recently started the manufacture of Tri-Robo, a three-wheeled robot that can scan a home for fires and gas leaks and then transmit this information to a smartphone. The cost structure to manufacture 20,000 Tri-Robos is as follows. Direct materials ($50 per robot) Direct labor ($40 per robot) Variable overhead ($6 per robot) Allocated fixed overhead ($30 per robot) Total Cost (a1) $1,000,000 800,000 120,000 600,000 $2,520,000 Jobs is approached by Tienh Inc., which offers to make Tri-Robo for $115 per unit or $2,300,000. Following are independent assumptions. Assume that $405,000 of the fixed overhead cost can be avoided. (Enter negative amounts using either a negative sign LEU A W P

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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Use the information provided to calculate standard costs: To make one switch it takes 19 feet of plastic-coated copper wire and 0.8 pounds of plastic material. The plastic material can usually be purchased for $20 per pound, and the wire costs $2.12 per foot. The labor necessary to assemble a switch consists of two types. The first type of labor is assembly, which takes 3.1 hours. These workers are paid $27 per hour. The second type of labor is finishing, which takes 2.4 hours. These workers are paid $28 per hour. Overhead is applied using labor hours. The variable overhead rate is $14.25 per labor hour. The fixed overhead rate is $15.26 per hour. What is the total standard cost for manufacturing overhead? Round to the nearest penny, two decimal places.
Haggstrom, Inc., manufactures steel fittings. Each fitting requires both steel and an alloy that allows the fitting to be used under extreme conditions. The following data apply to the production of the fittings. Direct materials per unit 3 pounds of steel at $0.55 per pound 0.5 pounds of alloy at $1.90 per pound Direct labor per unit 0.02 hours at $30 per hour Overhead per unit Indirect materials Indirect labor Utilities Plant and equipment depreciation Miscellaneous $0.60 0.75 0.55 0.90 0.70 Total overhead per unit $3.50 The plant and equipment depreciation and miscellaneous costs are fixed and are based on production of 250,000 units annually. All other costs are variable. Plant capacity is 300,000 units annually. All other overhead costs are variable. The following are forecast for year 2. Contract negotiations with the union are expected to lead to an increase in hourly direct labor costs of 4 percent, mostly in the form of additional benefits. Commodity prices, including steel,…
Use the information provided to calculate standard costs: To make one switch it takes 20 feet of plastic-coated copper wire and 0.3 pounds of plastic material. The plastic material can usually be purchased for $15 per pound, and the wire costs $2.99 per foot. The labor necessary to assemble a switch consists of two types. The first type of labor is assembly, which takes 3.4 hours. These workers are paid $28 per hour. The second type of labor is fınishing, which takes 2.4 hours. These workers are paid $26 per hour. Overhead is applied using labor hours. The variable overhead rate is $14.35 per labor hour. The fixed overhead rate is $15.42 per hour. What is the total standard cost for manufacturing overhead? Round to the nearest penny, two decimal places.
One of Astro Company's activity cost pools is machine setups, with estimated overhead of $150,000. Astro produces sparklers (400 setups) and lighters (600 setups). How much of the machine setup cost pool should be assigned to sparklers?
Lean Mfg: Vintage Audio Inc
Gable Company uses three activity pools. Each pool has a cost driver. Information for Gable Company follows: Total Cost of Pool $ 454,960 100,000 72,720 Estimated Cost Driver 96,800 10,000 505 Activity Pools Machining Designing costs Setup costs Suppose that Gable Company manufactures three products, A, B, and C. Information about these products follows: Product A Product B 38,000 4,000 40 Number of machine hours Number of design hours Number of batches Cost Driver Number of machine hours Number of design hours Number of batches Product A Product B Product C Total Overhead Assigned 48,000 2,200 170 Required: Using activity rates, determine the amount of overhead assigned to each product. Note: Do not round intermediate calculations. Round the final answer to nearest whole number. Product C 10,800 3,800 295
Marvel Parts, Incorporated, manufactures auto accessories.One of the company's products is a set of seat covers that can be adjusted to fit nearly any small car. The company uses a standard cost system for all of its products. According to the standards that have been set for the seat covers, the factory should work 2, 850 hours each month to produce 1,900 sets of covers. The standard costs associated with this level of production are: Total Per Set of Covers Direct materials $ 42, 560 $ 22.40 Direct labor $ 51,300 27.00 Variable manufacturing overhead (Training Training hing based on direct labor-hours) $ 6,840 3.60 $ 53.00 During August, the factory worked only 2, 800 direct labor-hours and produced 2,000 sets of covers. The following actual costs were recorded during the month: Total Per Set of Covers Direct materials (12, 000 yards) $ $ 45,600 $ 22.80 Direct labor $ 49,000 24.50 Variable manufacturing overhead $ 7,000 3.50 $ 50.80 At standard, each set of covers should require 5.6…
Gerber Clothing Inc. has designed a rain suit for outdoor enthusiasts that is about to be introduced on the market. A standard cost card has been prepared for the new suit, as follows: Standard Quantity or hours Standard price or Rate Standard Direct materials 2.2 metres Direct labour 1.0 hours Manufacturing overhead (1/6 variable) 1.0 hours $ 15 per metre 33 per hour 21 per hour Cost $33.00 Total standard cost per suit 33.00 21.00 $87.00 a. The only variable selling and administrative costs will be $6 per suit for shipping. Fixed selling and administrative costs will be as follows (per year): Salaries Advertising and other Total $ 35,400 157,000 $192,400 b. Since the company manufactures many products, it is felt that no more than 10,500 hours of labour time per year can be devoted to production of the new suits. c. An investment of $550,000 will be necessary to carry inventories and accounts receivable and to purchase some new equipment. The company wants a 20% ROI in new product…
Marvel Parts, Incorporated, manufactures auto accessories. One of the company's products is a set of seat covers that can be adjusted to fit nearly any small car. The company has a standard cost system in use for all of its products. According to the standards that have been set for the seat covers, the factory should work 1,040 hours each month to produce 2,080 sets of covers. The standard costs associated with this level of production are: Direct materials. Direct labor Variable manufacturing overhead (based on direct labor-hours) Direct materials (5,000 yards) Direct labor Variable manufacturing overhead Total $ 40,560 $ 7,280 $ 4,160 During August, the factory worked only 600 direct labor-hours and produced 1,800 sets of covers. The following actual costs were recorded during the month: Per Set of Covers $19.50 3.50 Total $ 34,200 $ 6,660 $ 4,140 2.00 $ 25.00 1. Materials price variance 1. Materials quantity variance 2. Labor rate variance 2. Labor efficiency variance 3. Variable…
A VACUUM MANAUFACTUER HAS PREPARED THE FOLLOWING HAS THE FOLLOWING COST DATA FOR MANUFACTURING ONE OF ITS ENGINE COMPONENTS BASED ON THE ANNUAL PRODUCTION OF 50,000 UNITS DIRECT MATERIALS $75,000 DIRECT LABOR $100,000 TOTAL $175,000 IN ADDITION, VARIABLE FACTORY OVERHEAD IS APPLIED AT $7.50 PER UNIT. FIXED FACTORY OVERHEAD IS APPLIED AT 150% OF DIRECT LABOUR COST PER UNIT. THE VACUUM SELLS FOR $150 EACH. A THIRD PARTY HAS OFFERED TO MAKE THE ENGINES FOR $60 PER UNIT. 75% OF THE FIXED FACTORY OVERHEAD, WHICH REPRESENTS EXECUTIVE SALARIES, RENT, DEPRECIATION, AND TAXES, CONTINUES REGARDLESS OF DECISION. sHOULD THE COMPANY MAKE OR BUY THE ENGINES?
The Wolverine Corporation is working at full production capacity producing 9,000 units of a unique product, Everlast. Manufacturing cost per unit for Everlast is as follows: (Click the icon to view the cost per unit information.) A customer, the Apex Company, has asked Wolverine to produce 3,500 units of Stronglast, a modification of Everlast. Stronglast would require the same manufacturing processes as Everlast. Apex has offered to pay Wolverine $31 for a unit of Stronglast plus half of the marketing cost per unit. Read the requirements. Requirement 1. What is the opportunity cost to Wolverine of producing the 3,500 units of Stronglast? (Assume that no overtime is worked.) Determine the formula for calculating the opportunity cost, then calculate the opportunity cost of producing the 3,500 units of Stronglast Selling price per unit Total variable cost per unit Units 3,500 38 $ 20 ( ($ Selling price per unit Total variable cost per unit Contribution margin per unit Contribution margin…