Cost Accounting, Student Value Edition Plus MyAccountingLab with Pearson eText -- Access Card Package (15th Edition)
Cost Accounting, Student Value Edition Plus MyAccountingLab with Pearson eText -- Access Card Package (15th Edition)
15th Edition
ISBN: 9780133781106
Author: Charles T. Horngren, Srikant M. Datar, Madhav V. Rajan
Publisher: PEARSON
Question
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Chapter 12, Problem 12.21E

1.

To determine

The amount and cost of unused administrative capacity at the beginning of 2013 based on the actual number of customers served.

Given information:

The actual capacity at the beginning is 4,700 customers.

The actual customers used to produce an output are 4,200 customers.

The price per unit of capacity is $380.

2.

To determine

The maximum amount of costs that the firm can save in 2013 by downsizing administrative capacity.

3.

To determine

The factors other than cost that the company should consider before downsizing the administrative capacity.

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During FY 2005 T-REX Manufacturing had total manufacturing costs are $418,000. Their cost of goods manufactured for the year was $448,000. The January 1, 2006 balance of the Work-in-Process Inventory is $49,000. Use this information to determine the dollar amount of the FY 2005 beginning Work-in-Process Inventory. Answer
Cooper Audio Systems produces car sound systems. Estimated sales (in units) are 45,000 in April, 38,000 in May, and 36,500 in June. Each unit is priced at $75. Cooper wants to have 40% of the following month's sales in ending inventory. That requirement was met on April 1. Each sound system requires 4 speakers and 10 feet of wiring. Speakers cost $6 each, and wiring is $0.50 per foot. Cooper wants to have 25% of the following month's production needs in ending raw materials inventory. On April 1, Cooper had 30,000 speakers and 95,000 feet of wire in inventory. What is Cooper's expected sales revenue for May?
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