Managerial Accounting: Creating Value in a Dynamic Business Environment
11th Edition
ISBN: 9781259569562
Author: Ronald W Hilton Proffesor Prof, David Platt
Publisher: McGraw-Hill Education
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Chapter 12, Problem 48P
1.
To determine
Write a memo to the president of Company N regarding its performance evaluation.
2.
To determine
Indicate a proper action for management.
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Sanyo Corporation manufactures a popular model of business calculators in a suburb of Seoul, South Korea. The
production process goes through two departments: assembly and testing. The following information (in thousands of
South Korean currency, the won) pertains to the testing department for the month of July.
Work-in-Process Inventory, July 1
Transferred-in costs
Costs added in July
Direct materials
Conversion
Direct materials
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During the month of July, 15,000 units were transferred in from the assembly department at the cost of 141,700 won,
and the testing department added costs of 201,820 won, as follows:
92,520 won
109, 300 won
6,000 units
57,800 won (100% complete)
Essay
23,400 won (100% complete)
23,360 won (80% complete)
During the month, 18,000 units were completed and transferred to the warehouse. At July 31, the completion percentage
of Work-in-Process was as follows:
90%…
Big Cheese Inc. has four processing departments through which all product flows.
Information for Department 2 for the most recent month is as follows:
Beginning work in process inventory in Department 2 consisted of 8,000 units
that were 70% complete.
During the month, 42,000 units were received from Department 1.
• 41,000 good units were completed and transferred to Department 3.
• At the end of the month, 8,200 units in Department 2 were 80% complete.
Remaining units were considered normal spoilage.
• When the units are complete, they are inspected and all material is then
added to the good units.
• Normal spoilage is charged to manufacturing overhead.
Required:
1. Prepare the first portion of the production report for Department 2: Quantity
Schedule and the Equivalent Units of Production (headings not required).
2. Why is the above costing system appropriate for this company?
Modern Building Solutions (MBS) builds portable buildings to clients’ specifications. The firm has two departments: Parts Fabrication and Assembly. The Parts Fabrication Department designs and cuts the major components of the building and is highly automated. The Assembly Department assembles and installs the components and this department is highly labor intensive. The Assembly Department begins work on the buildings as soon as the floor components are available from the Parts Fabrication Department.
In its first month of operations (March 2013), MBS obtained contracts for three buildings:
Job 1: a 20-by 40-foot storage building
Job 2: a 35-foot commercial utility building
Job 3: a 30-by 40-foot portable classroom
MBS bills its customers on a cost-plus basis, with profit set equal to 25 percent of costs. The firm uses a job order costing system based on normal costs. Overhead is applied in Parts Fabrication at a predetermined rate of P100 per machine hour (MH). In the Assembly…
Chapter 12 Solutions
Managerial Accounting: Creating Value in a Dynamic Business Environment
Ch. 12 - Why is goal congruence important to an...Ch. 12 - Define and give examples of the following terms:...Ch. 12 - Prob. 3RQCh. 12 - Explain the relationship between performance...Ch. 12 - What is the key feature of activity-based...Ch. 12 - What is the key feature of activity-based...Ch. 12 - Prob. 7RQCh. 12 - Define and give examples of the following terms:...Ch. 12 - Give an example of a common resource in an...Ch. 12 - Explain how and why cost allocation might be used...
Ch. 12 - Define the term cost allocation base. What would...Ch. 12 - Referring to Exhibit 125, why are marketing costs...Ch. 12 - Prob. 13RQCh. 12 - Why do some managers and accountants choose not to...Ch. 12 - Why is it important in responsibility accounting...Ch. 12 - Prob. 16RQCh. 12 - Prob. 17RQCh. 12 - What is meant by customer profitability analysis?...Ch. 12 - List seven areas in which nonfinancial,...Ch. 12 - Define the term manufacturing cycle efficiency.Ch. 12 - Prob. 21RQCh. 12 - What is meant by aggregate productivity, and what...Ch. 12 - Prob. 23RQCh. 12 - Using the Internet, identity the organizational...Ch. 12 - Prob. 25RQCh. 12 - Explain how an improvement in employee retention...Ch. 12 - For each of the following organizational subunits,...Ch. 12 - Prob. 28ECh. 12 - Prob. 29ECh. 12 - Xerox Corporation has been an innovator in its...Ch. 12 - The following data pertain to the Waikiki Sands...Ch. 12 - Lackawanna Community College has three divisions:...Ch. 12 - Countywide Cable Services, Inc. is organized with...Ch. 12 - Prob. 35ECh. 12 - Prob. 36ECh. 12 - Prob. 37ECh. 12 - Prob. 39PCh. 12 - Prob. 40PCh. 12 - Prob. 41PCh. 12 - Rocky Mountain General Hospital serves three...Ch. 12 - Refer to the organization chart for Rocky Mountain...Ch. 12 - Prob. 44PCh. 12 - Buckeye Department Stores, Inc. operates a chain...Ch. 12 - Building Services, Co. (BSC) was started a number...Ch. 12 - Warriner Equipment Company, which is located in...Ch. 12 - Prob. 48PCh. 12 - MedTech, Inc. manufactures diagnostic testing...Ch. 12 - Prob. 50PCh. 12 - Cathys Classic Clothes is a retailer that sells to...Ch. 12 - Pacific Rim Industries is a diversified company...
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