MyLab Accounting with Pearson eText -- Access Card -- for Horngren's Accounting, The Financial Chapters (My Accounting Lab)
11th Edition
ISBN: 9780133877502
Author: Tracie L. Miller-Nobles, Brenda L. Mattison, Ella Mae Matsumura
Publisher: PEARSON
expand_more
expand_more
format_list_bulleted
Concept explainers
Videos
Textbook Question
Chapter 23, Problem 4QC
MajorNet Systems is a start-up company that makes connectors for high-speed Internet connections The company has budgeted variable costs of $145 for each connector and fixed costs of $7,500 per month. MajorNefs static budget predicted production and sales of 100 connectors in August, but the company actually produced and sold only 84 connectors at a total cost of $21,000.
4. MajorNet Systems’s managers could set direct labor standards based on
Learning Objective 2
- time-and-motion studies.
- continuous improvement.
- benchmarking.
- All of the above.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Northern Defense manufactures radar systems. It has just completed the manufacture of its first newly designed system, RS-32. Manufacturing data for the RS-32 follow:
(Click icon to view data)
Requirement
Calculate the total variable costs of producing 2, 4, and 8 units.
Begin by calculating the cumulative total time in labor-hours using the cumulative average-time learning model. (Round the cumulative average time per unit to the nearest whole number.)
Cumulative number of Cumulative average time
units
2
per unit: Labor-hours
Cumulative total time:
Labor-hours
4
8
Data table
Direct material cost
$
84,000 per unit of RS-32
Direct manufacturing labor time for first unit
Learning curve for manufacturing labor time per radar system
3,800 direct manufacturing labor-hours
85% cumulative average time²
Direct manufacturing labor cost
$
23 per direct manufacturing labor-hour
Variable manufacturing overhead cost
$
17 per direct manufacturing labor-hour
Using the formula for an 85% learning…
Sharon Glessing, controller for Janson Company, has noticed that the company faces a 80 percent learning rate for its specialty design line. In planning the cost of the latest design, Sharon assumed that the first set of units would take 1,100 direct labor hours. She decided to use this information in budgeting for the cost of the total project, which would involve the manufacture of 16 sets. Direct labor is paid $40 per hour.
1. Complete the table below showing results by row for total production of: one unit, two units, four units, eight units, and sixteen units. (Round hour answers to two significant digits.) (Round Cumulative Total Time answers to the nearest whole number.)
2. What is the total labor cost if Janson Company makes eight sets? Sixteen sets? (Use the rounded answers in the subsequent computations).
3. Using the logarithmic function, complete the table below showing results by row for each of unit sets one through eight. (Round hour answers to two significant digits.)…
LearnCo
LearnCo manufactures and sells one product, an abacus for classroom use, with two models, the Basic model and the Deluxe model. The company began operations on January 1, 20Y1, and is planning for 20Y2, its second year of operations, by preparing budgets from its master budget.
The company is trying to decide how many units to manufacture, how much it might spend on direct materials and direct labor, and what their factory overhead expenses might be. In addition, the company is interested in budgeting for selling and administrative costs, and in creating a budgeted income statement showing a prediction of net income for 20Y2.
You have been asked to assist the controller of LearnCo in preparing the 20Y2 budgets.
Sales Budget
The sales budget often uses the prior year’s sales as a starting point, and then sales quantities are revised for various factors such as planned advertising and promotion, projected pricing changes, and expected industry and general economic conditions.…
Chapter 23 Solutions
MyLab Accounting with Pearson eText -- Access Card -- for Horngren's Accounting, The Financial Chapters (My Accounting Lab)
Ch. 23 - Prob. 1QCCh. 23 - MajorNet Systems is a start-up company that makes...Ch. 23 - MajorNet Systems is a start-up company that makes...Ch. 23 - MajorNet Systems is a start-up company that makes...Ch. 23 - MajorNet Systems has budgeted three hours of...Ch. 23 - MajorNet Systems has budgeted three hours of...Ch. 23 - FrontGrade Systems allocates manufacturing...Ch. 23 - FrontGrade Systems allocates manufacturing...Ch. 23 - FrontGrade Systems allocates manufacturing...Ch. 23 - The person probably most responsible for the...
Ch. 23 - HajorNet System’s static budget predicted...Ch. 23 - What is a variance?Ch. 23 - Explain the difference between a favorable and an...Ch. 23 - What is a static budget performance report?Ch. 23 - How do flexible budgets differ from static...Ch. 23 - How is a flexible budget used?Ch. 23 - What are the two components of the static budget...Ch. 23 - What is a flexible budget performance report?Ch. 23 - What is a standard cost system?Ch. 23 - Explain the difference between a cost standard and...Ch. 23 - Give the general formulas for determining cost and...Ch. 23 - How does the static budget affect cost and...Ch. 23 - List the direct materials variances, and briefly...Ch. 23 - List the direct labor variances, and briefly...Ch. 23 - List the variable overhead variances, and briefly...Ch. 23 - List the fixed overhead variances, and briefly...Ch. 23 - How is the fixed overhead volume variance...Ch. 23 - What is management by exception?Ch. 23 - List the eight product variances and the manager...Ch. 23 - Briefly describe how journal entries differ in a...Ch. 23 - What is a standard cost income statement?Ch. 23 - Matching terms Learning Objective 1 Match each...Ch. 23 - Prob. S23.2SECh. 23 - Prob. S23.3SECh. 23 - Matching terms Learning Objective 2 Match each...Ch. 23 - Identifying the benefits of standard costs...Ch. 23 - Prob. S23.6SECh. 23 - Prob. S23.7SECh. 23 - Interpreting material and labor variances Learning...Ch. 23 - Prob. S23.9SECh. 23 - Prob. S23.10SECh. 23 - Prob. S23.11SECh. 23 - Prob. S23.12SECh. 23 - Prob. S23.13SECh. 23 - Prob. S23.14SECh. 23 - Prob. E23.15ECh. 23 - Prob. E23.16ECh. 23 - Prob. E23.17ECh. 23 - Prob. E23.18ECh. 23 - Prob. E23.19ECh. 23 - Prob. E23.20ECh. 23 - Prob. E23.21ECh. 23 - Prob. E23.22ECh. 23 - Preparing journal entries Hayesvillc Company uses...Ch. 23 - Prob. E23.24ECh. 23 - Prob. P23.25APGACh. 23 - Preparing a flexible budget computing standard...Ch. 23 - Prob. P23.27APGACh. 23 - P23-28A Computing and journalizing standard cost...Ch. 23 - Prob. P23.29APGACh. 23 - Prob. P23.30BPGBCh. 23 - Preparing a flexible budget computing standard...Ch. 23 - P23-32B Computing standard cost variances and...Ch. 23 - P23-33B Computing and journalizing standard cost...Ch. 23 - Preparing a standard cost income statement...Ch. 23 - Prob. P23.35CPCh. 23 - Decision Case 23-1 Suppose you manage the local...Ch. 23 - Fraud Case 23-1 Drew Castello, general manager of...
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- Bordner Company manufactures HVAC (heating, ventilation, and air conditioning) systems for commercial buildings. For each new design, Bordner faces a 90 percent learning rate. On average, the first unit of a new design takes 600 hours. Direct labor is paid 25 per hour. Required: 1. Set up a table with columns showing: the cumulative number of units, cumulative average time per unit in hours, and cumulative total time in hours. Show results by row for total production of one unit, two units, four units, eight units, and sixteen units. (Round hour answers to two significant digits.) 2. What is the total labor cost if Bordner makes the following number of units: one, four, sixteen? What is the average cost per system for the following number of systems: one, four, or sixteen? (Round your answers to the nearest dollar.) 3. Using the logarithmic function, set up a table with columns showing: the cumulative number of units, cumulative average time per unit in hours, cumulative total time in hours, and the time for the last unit. Show results by row for each of units one through eight. (Round answers to two significant digits.)arrow_forwardFrea manufactures specialty components for the electronics industry in a highly labor intensive environment. ABC Electronics has asked Lake to bid on a component that Frea made for ABC last month. The previous order was for 80 units and required 160 hours of direct labor manufacture. ABC would now like 560 additional components. NUBD experiences an 80% learning curve on all of its jobs. The number of direct labor hours needed for Frea to complete the 560 additional components is?arrow_forwardHarriman Industries manufactures engines for the aerospace industry. It has completed manufacturing the first unit of the new ZX-9 engine design. Management believes that the 1,000 labor hours required to complete this unit are reasonable and is prepared to go forward with the manufacture of additional units. An 80 percent cumulative average-time learning curve model for direct labor hours is assumed to be valid. Data on costs are as follows: Required: 1. Set up a table with columns for cumulative number of units, cumulative average time per unit in hours, and the cumulative total time in hours. Complete the table for 1, 2, 4, 8, 16, and 32 units. (Round hours to one significant digit.) 2. What are the total variable costs of producing 1, 2, 4, 8, 16, and 32 units? What is the variable cost per unit for 1, 2, 4, 8, 16, and 32 units?arrow_forward
- The following information is provided to you: Time taken to produce first 8 shock pads 640 hours Time taken to produce first 16 shock pads 1200 hours Calculate the learning curve The following information is provided to you: Direct labour needed to make first machine. 1000 hoursLearning curve. 80%Direct labour cost. R300 per hourDirect materials cost. R180000 per machine Fixed cost for machines at each cumulative production R800000 Calculate the total direct hours required to manufacture four (4) machines. ( Indicate both average time per unit as well as cumulative time per unit for all theunits) Calculate the total costs to manufacture 4 machinesarrow_forwardNational Co. manufactures specialty components for the electronics industry in a highly labor intensive environment. Filipina Electronics has asked National to bid on a component that National made for Filipina last month. The previous order was for 80 units and required 150 hours of direct labor to manufacture. Filipina would now like 240 additional components. National experiences an 80% learning curve on all of its jobs. The number of direct labor hours needed for National to complete the 240 additional components is 360.0 187.2 307.2 234arrow_forwardLearn Co Learn Co manufactures and sells one product, an abacus for classroom use, with two models, the Basic model and the Deluxe model. The company began operations on January 1, 20Y1, and is planning for 20Y2, its second year of operations, by preparing budgets from its master budget. The company is trying to decide how many units to manufacture, how much it might spend on direct materials and direct labor, and what their factory overhead expenses might be. In addition, the company is interested in budgeting for selling and administrative costs, and in creating a budgeted income statement showing a prediction of net income for 20Y2. You have been asked to assist the controller of LearnCo in preparing the 20Y2 budgets. Sales Budget The sales budget often uses the prior year's sales as starting point, and then sales quantities are revised for various factors such as planned advertising and promotion, projected pricing changes, and expected industry and general economic conditions.…arrow_forward
- Sylvan Creations designs, manufactures, and sells modern wood sculptures. Sandra Johnson is an artist for the company. Johnson has spent much of the past month working on the design of an intricate abstract piece. Jim Chase, product development manager, likes the design. However, he wants to make sure that the sculpture can be priced competitively. Ellen Cooper, Sylvan’s cost accountant, presents Chase with the following cost data for the expected production of 75 sculptures: Design cost $10,000 Direct materials 80,000 Direct manufacturing labor 27,500 Variable manufacturing overhead 10,000 Fixed manufacturing overhead 42,500 Fixed marketing costs 17,500 Q.What challenges might managers at Sylvan Creations encounter in achieving the target cost and how might they overcome these challenges?arrow_forwardSylvan Creations designs, manufactures, and sells modern wood sculptures. Sandra Johnson is an artist for the company. Johnson has spent much of the past month working on the design of an intricate abstract piece. Jim Chase, product development manager, likes the design. However, he wants to make sure that the sculpture can be priced competitively. Ellen Cooper, Sylvan’s cost accountant, presents Chase with the following cost data for the expected production of 75 sculptures: Design cost $10,000 Direct materials 80,000 Direct manufacturing labor 27,500 Variable manufacturing overhead 10,000 Fixed manufacturing overhead 42,500 Fixed marketing costs 17,500 Q.Chase believes that competition will require Sylvan to reduce the price of the sculpture to $2,800. Rather than using the highest-grade wood available, Sylvan could use standard grade wood and lower the cost of direct materials by 25%. This redesign will require an additional $1,500 of design cost. Will this design change allow…arrow_forwardSylvan Creations designs, manufactures, and sells modern wood sculptures. Sandra Johnson is an artist for the company. Johnson has spent much of the past month working on the design of an intricate abstract piece. Jim Chase, product development manager, likes the design. However, he wants to make sure that the sculpture can be priced competitively. Ellen Cooper, Sylvan’s cost accountant, presents Chase with the following cost data for the expected production of 75 sculptures: Design cost $10,000 Direct materials 80,000 Direct manufacturing labor 27,500 Variable manufacturing overhead 10,000 Fixed manufacturing overhead 42,500 Fixed marketing costs 17,500 Q. Chase thinks that Sylvan Creations can successfully market each piece for $3,000. To earn the required return on capital, the company’s target operating income per unit is 20% of target price. Calculate the target full cost per unit of producing the 75 sculptures. Does the cost estimate Cooper developed meet Sylvan’s requirements?…arrow_forward
- CodeHead Software Inc. does software development. One important activity in software development is writing software code. The manager of the WordPro Development Team determined that the average software programmer could write 25 lines of code in an hour. The plan for the first week in May called for 4,650 lines of code to be written on the WordPro product. The WordPro Team has five programmers. Each programmer is hired from an employment firm that requires temporary employees to be hired for a minimum of a 40-hour week. Programmers are paid 32.00 per hour. The manager offered a bonus if the team could generate more lines for the week, without overtime. Due to a project emergency, the programmers wrote more code in the first week of May than planned. The actual amount of code written in the first week of May was 5,650 lines, without overtime. As a result, the bonus caused the average programmers hourly rate to increase to 40.00 per hour during the first week in May. Instructions 1. If the team generated 4,650 lines of code according to the original plan, what would have been the labor time variance? 2. What was the actual labor time variance as a result of generating 5,650 lines of code? 3. What was the labor rate variance as a result of the bonus? 4. The manager is trying to determine if a better decision would have been to hire a temporary programmer to meet the higher programming demand in the first week of May, rather than paying out the bonus. If another employee was hired from the employment firm, what would have been the labor time variance in the first week? 5. Which decision is better, paying the bonus or hiring another programmer?arrow_forwardDwyran Ltd also produce, the Menai, which has been in production for a number of years, and to date 497 units of the Menai have been produced. The budget for the next quarter is showing the production of 65 units of the Menai. If the 1st ever unit took 200 hours and an 80% learning curve applies: Calculate the total labours hours needed for the production of 65 units of the Menai Calculate the average labour time per unit Note: the learning co-efficient of 80% is -0.322arrow_forwardNorthern Defense manufactures radar systems. It has just completed the manufacture of its first newly designed system, RS-32. Manufacturing data for the RS-32 follow: Home Insert Page Layout Formulas Data Review View 1 Direct material cost 2 Direct manufacturing labor time for first unit 3 Learning curve for manufacturing labor time 4 Direct manufacturing labor cost 5 Variable manufacturing overhead cost $ 84,000 per unit of RS-32 4,400 direct manufacturing labor-hours 85% cumulative average time 27 per direct manufacturing labor-hour 13 per direct manufacturing labor-hour per radar system 2$ In 0.85 -0.162519 7 "Using the formula (page 391), for an 85% learning curve, b= In 2- 0.693147 =-0234465 Calculate the total variable costs of producing 2, 4, and 8 units.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Managerial AccountingAccountingISBN:9781337912020Author:Carl Warren, Ph.d. Cma William B. TaylerPublisher:South-Western College Pub
Financial And Managerial AccountingAccountingISBN:9781337902663Author:WARREN, Carl S.Publisher:Cengage Learning,
Cornerstones of Cost Management (Cornerstones Ser...AccountingISBN:9781305970663Author:Don R. Hansen, Maryanne M. MowenPublisher:Cengage Learning
Managerial Accounting
Accounting
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:South-Western College Pub
Financial And Managerial Accounting
Accounting
ISBN:9781337902663
Author:WARREN, Carl S.
Publisher:Cengage Learning,
Cornerstones of Cost Management (Cornerstones Ser...
Accounting
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Cengage Learning
What is Cost Allocation? Definition & Process; Author: FloQast;https://www.youtube.com/watch?v=hLhvvHvZ3JM;License: Standard Youtube License