Cost Accounting: A Managerial Emphasis, 15th Edition
15th Edition
ISBN: 9780133803815
Author: Charles T. Horngren, Srikant M. Datar, Madhav V. Rajan
Publisher: PEARSON
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Question
Chapter 22, Problem 22.34P
1.
To determine
The transfer price per roll of recycled paper and would the production manager will choose to purchase 2,000 pounds next month from EC.
Given information:
The rate of the recycling division is $0.075.
Numbers of the recyclable paper used is 100 pounds.
Variable cost is $6.35.
Fixed cost is $2.15.
The recycling paper is transferred to the manufacturing division at the cost of 110%.
2.
To determine
Whether the external purchase is in the best interest of CM and the cause for this goal incongruence.
Given information:
The rate of the recycling division is $0.075.
Numbers of the recyclable paper used is 100 pounds.
Variable cost is $6.35.
Fixed cost is $2.15.
3.
To determine
The reason of the sudden price cut, comment on the validity of the $17 per roll market price and the ethics of the manufacturing manager and whether the change in transfer price to $17 matter to SC.
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PART 2.
(22 marks)
Mangal Furnishings produce serving trays for the tourist industry in a five-stage process - Cutting &
Shaping, Assembly, Sanding, Finishing and Packaging. Upon entering the finishing process, before
the trays are stained and polished, a specialized piece of equipment is used to engrave a logo on
each tray. After Packaging, the trays are sent to the business warehouse for delivery to customers.
The following data relates to the Finishing Process for the month of March during which 3,800 trays
valued at $597.90 each were transferred in from the Sanding Process.
Other production costs incurred during the month are summarized as follows:
Direct Materials Added
Direct Manufacturing Wages
Hireage cost of specialized logo equipment
Manufacturing Overhead
$343,380
$830,150
$21,300
$412,100
Process inspection occurs during the process and normally 2% of the trays entering the Finishing
process are rejected and sold as scrap to local retailers at $750 each. During the month…
Equipment that costs $110,000 and on which $50,000 of accumulated depreciation has been recorded was disposed of for $70,000 cash. Recording this event would include an: A. gain of $10,000 B. A loss of $5,000. C. Increase to accumulated depreciation for $15,000 D. Decrease to equipment for $15,000.
General accounting question
Chapter 22 Solutions
Cost Accounting: A Managerial Emphasis, 15th Edition
Ch. 22 - Prob. 22.1QCh. 22 - Describe three criteria you would use to evaluate...Ch. 22 - What is the relationship among motivation, goal...Ch. 22 - Name three benefits and two costs of...Ch. 22 - Organizations typically adopt a consistent...Ch. 22 - Transfer pricing is confined to profit centers. Do...Ch. 22 - What are the three methods for determining...Ch. 22 - What properties should transfer-pricing systems...Ch. 22 - All transfer-pricing methods give the same...Ch. 22 - Prob. 22.10Q
Ch. 22 - Prob. 22.11QCh. 22 - Prob. 22.12QCh. 22 - Prob. 22.13QCh. 22 - Under the general guideline for transfer pricing,...Ch. 22 - How should managers consider income tax issues...Ch. 22 - Prob. 22.16ECh. 22 - Prob. 22.17ECh. 22 - Prob. 22.18ECh. 22 - Prob. 22.19ECh. 22 - Prob. 22.20ECh. 22 - Prob. 22.21ECh. 22 - Prob. 22.22ECh. 22 - Prob. 22.23ECh. 22 - Prob. 22.24ECh. 22 - Prob. 22.25ECh. 22 - Prob. 22.26ECh. 22 - Prob. 22.27PCh. 22 - Prob. 22.28PCh. 22 - Prob. 22.29PCh. 22 - Prob. 22.30PCh. 22 - Prob. 22.31PCh. 22 - Prob. 22.32PCh. 22 - Prob. 22.33PCh. 22 - Prob. 22.34PCh. 22 - Prob. 22.35PCh. 22 - Prob. 22.36P
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