Cost Accounting, Student Value Edition (15th Edition)
15th Edition
ISBN: 9780133428858
Author: Charles T. Horngren, Srikant M. Datar, Madhav V. Rajan
Publisher: PEARSON
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Question
Chapter 5, Problem 5.25E
1.
To determine
Simple Costing System:
Simple costing system is one of method of costing to estimate the amount of allocating the
Activity Based Costing:
Activity based costing is one of the methods of costing to identify the activities performed to manufacture a product and to allocate the overhead cost of resources or indirect cost to the related products.
Income Statement:
Income statement is a business’s financial statement which tells the financial performance of a company in an accounting period. It shows the income generated by a company and expenses incurred by a company through its operations.
To prepare: Product line profitability report for HS under the simple costing system.
Given information:
Revenue from product BG is $59,500.
Cost of goods sold of product BG is $36,000.
Revenue from product MF is $66,000.
Cost of goods sold of product MF is $48,000.
Revenue from product FP is $51,000.
Cost of goods sold of product FP is $34,000.
Store support cost of product BG is $10,800.
Store support cost of product MF is $14,400.
Store support cost of product FP is $10,200.
2.
To determine
To prepare: Product line profitability report for HS under the activity based costing system.
Given information:
Gross margin of product BG is $23,500.
Gross margin of product MF is $18,000.
Gross margin of product FP is $17,000.
3.
To determine
To explain: The insight from ABC system to HS managers.
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Chapter 5 Solutions
Cost Accounting, Student Value Edition (15th Edition)
Ch. 5 - What is broad averaging, and what consequences can...Ch. 5 - Why should managers worry about product...Ch. 5 - What is costing system refinement? Describe three...Ch. 5 - What is an activity-based approach to designing a...Ch. 5 - Describe four levels of a cost hierarchy.Ch. 5 - Why is it important to classify costs into a cost...Ch. 5 - What are the key reasons for product cost...Ch. 5 - Prob. 5.8QCh. 5 - Department indirect-cost rates are never...Ch. 5 - Prob. 5.10Q
Ch. 5 - Prob. 5.11QCh. 5 - Prob. 5.12QCh. 5 - Activity-based costing is the wave of the present...Ch. 5 - Increasing the number of indirect-cost pools is...Ch. 5 - The controller of a retail company has just had a...Ch. 5 - Prob. 5.16ECh. 5 - ABC, cost hierarchy, service. (CMA, adapted)...Ch. 5 - Prob. 5.18ECh. 5 - Prob. 5.19ECh. 5 - Prob. 5.20ECh. 5 - Prob. 5.21ECh. 5 - Prob. 5.22ECh. 5 - Prob. 5.23ECh. 5 - Prob. 5.24ECh. 5 - Prob. 5.25ECh. 5 - Prob. 5.26ECh. 5 - Prob. 5.27ECh. 5 - Prob. 5.28ECh. 5 - Prob. 5.29ECh. 5 - Prob. 5.30PCh. 5 - Prob. 5.31PCh. 5 - Prob. 5.32PCh. 5 - Prob. 5.33PCh. 5 - Prob. 5.34PCh. 5 - Prob. 5.35PCh. 5 - Prob. 5.36PCh. 5 - Prob. 5.37PCh. 5 - Prob. 5.38PCh. 5 - Prob. 5.39PCh. 5 - Prob. 5.40PCh. 5 - Prob. 5.41PCh. 5 - Prob. 5.42P
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