Trend Reporting for Non-Value-Added Costs Cicleta Manufacturing has four activities: receiving materials, assembly, expediting products, and storing goods. Receiving and assembly are necessary activities; expediting and storing goods are unnecessary. The following data pertain to the four activities for the year ending 20x1 (actual price per unit of the activity driver is assumed to be equal to the standard price): Activity Activity Driver SQ AQ SP Receiving       Receiving orders 12,000     24,000     $21     Assembly       Labor hours 99,000     120,000     15     Expediting       Orders expedited 0     8,000     50     Storing       Number of units 0     16,000     7     Assume that at the beginning of 20x2, Cicleta trained the assembly workers in a new approach that had the objective of increasing the efficiency of the assembly process. Cicleta also began moving toward a JIT purchasing and manufacturing system. When JIT is fully implemented, the demand for expediting is expected to be virtually eliminated. It is expected to take two to three years for full implementation. Assume that receiving cost is a step-fixed cost with steps of 1,500 orders. The other three activities employ resources that are acquired as used and needed. At the end of 20x2, the following results were reported for the four activities: Activity Activity Driver SQ AQ SP Receiving       Receiving orders 8,800     8,800     $15     Assembly       Labor hours 100,000     103,000     11     Expediting       Orders expedited 0     4,000     36     Storing       Number of units 0     8,000     5     Required: Prepare a trend report that shows the non-value-added costs for each activity for 20x1 and 20x2 and the change in costs for the two periods. Enter all decreases as positive amounts and all increases as negative amounts. i.e. if 20x1 was 150,000 and 20x2 was 250,000 that would be an increase and would need to be entered as a negative amount. If an amount is zero, enter "0". Cicleta Manufacturing Trend Report: Non-Value-Added Costs For the Years 20x1 and 20x2 Activity 20x1 20x2 Change Receiving $fill in the blank 1 $fill in the blank 2 $fill in the blank 3 Assembly fill in the blank 4 fill in the blank 5 fill in the blank 6 Expediting fill in the blank 7 fill in the blank 8 fill in the blank 9 Storing fill in the blank 10 fill in the blank 11 fill in the blank 12 Total $fill in the blank 13 $fill in the blank 14 $fill in the blank 15

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Chapter1: Financial Statements And Business Decisions
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Trend Reporting for Non-Value-Added Costs

Cicleta Manufacturing has four activities: receiving materials, assembly, expediting products, and storing goods. Receiving and assembly are necessary activities; expediting and storing goods are unnecessary. The following data pertain to the four activities for the year ending 20x1 (actual price per unit of the activity driver is assumed to be equal to the standard price):

Activity Activity Driver SQ AQ SP
Receiving       Receiving orders 12,000     24,000     $21    
Assembly       Labor hours 99,000     120,000     15    
Expediting       Orders expedited 0     8,000     50    
Storing       Number of units 0     16,000     7    

Assume that at the beginning of 20x2, Cicleta trained the assembly workers in a new approach that had the objective of increasing the efficiency of the assembly process. Cicleta also began moving toward a JIT purchasing and manufacturing system. When JIT is fully implemented, the demand for expediting is expected to be virtually eliminated. It is expected to take two to three years for full implementation. Assume that receiving cost is a step-fixed cost with steps of 1,500 orders. The other three activities employ resources that are acquired as used and needed. At the end of 20x2, the following results were reported for the four activities:

Activity Activity Driver SQ AQ SP
Receiving       Receiving orders 8,800     8,800     $15    
Assembly       Labor hours 100,000     103,000     11    
Expediting       Orders expedited 0     4,000     36    
Storing       Number of units 0     8,000     5    

Required:

Prepare a trend report that shows the non-value-added costs for each activity for 20x1 and 20x2 and the change in costs for the two periods. Enter all decreases as positive amounts and all increases as negative amounts. i.e. if 20x1 was 150,000 and 20x2 was 250,000 that would be an increase and would need to be entered as a negative amount. If an amount is zero, enter "0".

Cicleta Manufacturing
Trend Report: Non-Value-Added Costs
For the Years 20x1 and 20x2
Activity 20x1 20x2 Change
Receiving $fill in the blank 1 $fill in the blank 2 $fill in the blank 3
Assembly fill in the blank 4 fill in the blank 5 fill in the blank 6
Expediting fill in the blank 7 fill in the blank 8 fill in the blank 9
Storing fill in the blank 10 fill in the blank 11 fill in the blank 12
Total $fill in the blank 13 $fill in the blank 14 $fill in the blank 15
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