Lost sales due to poor quality Quality data gathering, analysis, and reporting Net cost of spoilage Re-entering data because of keying errors Test and inspection of in-process goods Final product testing and inspection Statistical process control activities Returns arising from quality problems Downtime caused by quality problems $ 15,200 $ 64,700 $ 68,300 $ 20,700 $ 19,500 $ 43,800 $ 36,300 $ 33,100 $ 65,000

Lost sales due to poor quality Quality data gathering, analysis, and reporting Net cost of spoilage Re-entering data because of keying errors Test and inspection of in-process goods Final product testing and inspection Statistical process control activities Returns arising from quality problems Downtime caused by quality problems $ 15,200 $ 64,700 $ 68,300 $ 20,700 $ 19,500 $ 43,800 $ 36,300 $ 33,100 $ 65,000

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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1. COST BEHAVIOR ANALYSIS During this pandemic, almost all business lines experienced income instability, as experienced by PIZZA CALIFORNIA. For this reason, the company strives to reduce costs that are not value added. Below are the estimated costs and expenses for period 1 and period 2. Assumption of Relevant Range of 10,000 to 20,000 units. COST / EXPENSE PERIODE I PERIODE IV Unit production/unit sold 12,000 18,000 Direct material used $ 45,000 $ 67,500 Direct Labor cost 33,000 49,500 Production supervisors salaries 13,500 13,500 Directors salaries 26,500 26,500 Depreciation expense - factory building 11,500 11,500 Depreciation expense - factory equipment 7,700 7,700 Overtime Premium 49,500 74,250 Marketing person salaries 30,000 43.000 Utilities expense - factory 25,,480 34,720 Rent expense - store 2,700 2,700 Property tax - factory 2,300 2,300 Indirect…
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Strategic Cost Management