Prepare a Cost of Quality report that classifies the costs above into the appropriate COQ category. Round all amounts to whole dollars in your solution.
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Cardinal Co. has the following information related to costs of quality.
|
|
Amount / Rate |
|
Units produced and sold |
150,000 |
|
% units reworked |
6.0% |
|
% of units returned by customers |
2.5% |
|
Scheduled testing & inspection of equipment |
50 hours |
|
Breakdown equipment maintenance |
150 hours |
|
Product design |
400 hours |
|
Cost of rework units |
$12 per unit |
|
Cost of customer returns |
$25 per unit |
|
Maintenance cost per hour |
$80 per hour |
|
Product design cost per hour |
$ 15 per hour |
Prepare a Cost of Quality report that classifies the costs above into the appropriate COQ category. Round all amounts to whole dollars in your solution.
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- After much effort and analysis, you determined the following cost formulas and gathered the following actual cost data for March: Cost Formula Actual Cost in March Utilities $16,500 + $0.13 per machine-hour $ 20,250 Maintenance $39,000 + $1.90 per machine-hour $ 61,300 Supplies $0.60 per machine-hour $ 8,800 Indirect labor $94,400 + $1.60 per machine-hour $ 119,300 Depreciation $68,200 $ 69,900 During March, the company worked 13,000 machine-hours and produced 7,000 units. The company had originally planned to work 15,000 machine-hours during March. Required: 1. Prepare a flexible budget for March. 2. Prepare a report showing the spending variances for March.Deoro Company has identified the following overhead activities, costs, and activity drivers for the coming year: Activity Expected Cost Activity Driver Activity Capacity Setting up equipment $458,780 Number of setups 580 Ordering costs 354,900 Number of orders 16,900 Machine costs 710,600 Machine hours 41,800 Receiving 417,100 Receiving hours 9,700 Deoro produces two models of dishwashers with the following expected prime costs and activity demands: Model A Model B Direct materials $578,000 $772,000 Direct labor $470,000 $459,000 Units completed 15,500 8,500 Direct labor hours 5,300 2,100 Number of setups 370 210 Number of orders 5,000 11,900 Machine hours 24,000 17,800 Receiving hours 2,800 6,900 The company's normal activity is 7,400 direct labor hours. Required: 1. Determine the unit cost for each model using direct labor hours to apply overhead. Round intermediate calculations and final answers to nearest cent. Unit Cost Model A $fill in…Pasternik Company produces and sells two products, Alpha and Zeta. The following information is available relating to its setup activities: Alpha Zeta Units produced 250 20,000 Batch size (units) 10 500 Total direct labor hours 1,000 39,000 Cost per setup $2,000 $2,000 Use of activity-based costing would allocate the following amounts of setup cost to each unit (rounded to the nearest cent): Alpha Zeta A) $200.00 $4.00 B) $500.00 $1,025.64 C) $6.42 $6.50 D) $80.00 $50.00 E) $8.00 $0.10
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- The J. Page Furniture Company has the following information available regarding costs at various levels of Pi monthly production. Note that the company's total maximum productive capacity is 30,000 units: m Total Cost $72,000 91,800 101,480 12,000 to Direct materials $32,000 40,800 $100,000 he Direct labor 127,500 or SI 45,380 Indirect materials 140,750 Supervisors' salaries 12,000 12,000 ta Depreciation on plant and equipment 8,000 8,000 58,350 8,000 Maintenance 26,350 80,750 Utilities 6,800 14,300 19,550 NI Insurance on plant and equipment 1,600 1,600 1,600 C. 150.000 $640.150 48,000 108.000 $467.530 in Property taxes on plant and equipment $220,930 8,000 Units Ca in Total 18.000 Units 25.000 Units Units produced Required a. For each cost component above, determine whether its cost is a: th t 4omHeintz Products uses activity-based costing to account for product costs. The plant manager has estimated the following cost drivers and rates. Activity Centers Materials inspection Equipment maintenance Machine setups Packing and shipping Cost Drivers Direct materials cost Machine-hours Number of production runs Pounds of finished output Rate per Cost Driver Unit 15% of materials cost $ 19 per machine-hour $ 6,370 per setup $ 4.20 per pound Direct materials costs were $508,000 and direct labor costs were $348,000 during November, when the plant finished 7,000 pounds of product, had 20 setups, and ran the machines for 15,000 hours. There were no work-in-process inventories. Required: Use T-accounts to show the flow of materials, labor, and overhead costs from the four overhead activity centers through Work- in-Process Inventory and out to Finished Goods Inventory. Use the accounts Materials Inventory, Wages Payable, Work-in- Process Inventory, Finished Goods Inventory, and four…The Widget Company produces two types of widgets, Standard and Deluxe. Data related to the two products is presented below. Standard Deluxe Annual production in units 25,000 50,000 Direct material costs $75,000 $150,000 Direct manufacturing labor costs $25,000 $50,000 Direct manufacturing labor-hours 1,250 2,500 Machine hours 12,500 25,000 Number of production runs 25 25 Inspection hours 500 250 Both products pass through Departments A and Department B. The departments’ combined manufacturing overhead costs are: Total Machine Costs $187,500 Setup Costs 60,000 Inspection Costs 52,500 Required: Using Activity Based Costing, Compute the…
- Sherman Manufacturing Company currently manufactures a component used in one of its products. The annual production costs for 11,300 components are as follows: Material cost Labor cost Overhead Batch-level set-up costs for year Product-level manager's salary Allocated facility-level costs $ 7 per unit $ 3 per unit $ 1 per unit $ 5,700 $ 17,700 $ 11,700 An outside company has offered to supply 11,300 units of the component for $14.40 each. If the company outsources the component, it will be able to rent out the idle factory space for $2,000 per month but will not terminate the product manager. Required: a. Which items are not relevant to this outsourcing decision? b. Identify any opportunity costs associated with this decision. c. Prepare a quantitative analysis that indicates whether the component should be outsourced. Complete this question by entering your answers in the tabs below. Required A Required B Required C Prepare a quantitative analysis that indicates whether the component…Carla Vista Industries has three activity cost pools and two products. It expects to produce 2,700 units of Product SZ09 and 1,400 of Product NZ16. Having identified its activity cost pools and the cost drivers for each pool, Carla Vista accumulated the following data relative to those activity cost pools and cost drivers. question: Assign the overhead cost to the two products: SZ09$? and NZ16$?Genious Corporation implemented activity-based costing several years ago and uses it for its external financial reports. The company has four activity cost pools, which are listed below. Activity Cost Pool Activity Measure Estimated Overhead Cost Machine related Machine Hours $90,000 Purchase orders Number of orders $126,000 Machine setups Number of Setups $200,000 General factory Number of labor hrs $60,000 Expected Activity 5,000 Mhs 2,800 orders 10,000 setups 4,000 Dlhs Manufacturing overhead cost was applied to production. Actual activity during the year was as follows: Activity Cost Pool Machine related Purchase orders Machine setups General factory Actual Activity 10,500 Mhs 800 orders 1,500 setups 8,000 Dlhs It is expected that the company will produce 62,500 units. Compute the activity rate for each activity. Compute the per unit cost for overhead
