Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN: 9781305970663
Author: Don R. Hansen, Maryanne M. Mowen
Publisher: Cengage Learning
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Chapter 5, Problem 6E
To determine
Categorize the types of firms as either manufacturing or services and give reasons for the choice in terms of the four features of service firms.
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Classifying Firms as Either Manufacturing or Service
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Chapter 5 Solutions
Cornerstones of Cost Management (Cornerstones Series)
Ch. 5 - What is cost measurement? Cost accumulation? What...Ch. 5 - Why is actual costing rarely used for product...Ch. 5 - Explain the differences between job-order costing...Ch. 5 - What are some differences between a manual...Ch. 5 - Prob. 5DQCh. 5 - How do firms collect job-related information on...Ch. 5 - Explain the role of activity drivers in assigning...Ch. 5 - Define the following terms: expected actual...Ch. 5 - Why would some prefer normal activity to expected...Ch. 5 - When using normal costing, how are jobs charged...
Ch. 5 - Wilson Company has a predetermined overhead rate...Ch. 5 - Why are the accounting requirements for job-order...Ch. 5 - Explain the difference between normal cost of...Ch. 5 - Amber Company produces custom framing. For one...Ch. 5 - Amber Company produces custom framing. For one...Ch. 5 - Naranjo Company designs industrial prototypes for...Ch. 5 - Naranjo Company designs industrial prototypes for...Ch. 5 - Heitger Company is a job-order costing firm that...Ch. 5 - Frieling Company installs granite countertops in...Ch. 5 - Frieling Company installs granite countertops in...Ch. 5 - Prob. 6ECh. 5 - Vince Melders, of EcoScape Company, designs and...Ch. 5 - Refer to the data in Exercise 5.7. Vince Melders,...Ch. 5 - Reggie Wilmore has just started a new...Ch. 5 - Reggie Wilmore has just started a new...Ch. 5 - During March, Aragon Company worked on three jobs....Ch. 5 - Job Cost On April 1, Sangvikar Company had the...Ch. 5 - Job Cost On April 1, Sangvikar Company had the...Ch. 5 - On August 1, Cairle Companys work-in-process...Ch. 5 - On August 1, Cairle Companys work-in-process...Ch. 5 - Ehrling Brothers Company makes jobs to customer...Ch. 5 - During August, Skyler Company worked on three...Ch. 5 - Feldspar Company uses an ABC system to apply...Ch. 5 - Kapoor Company uses job-order costing. During...Ch. 5 - Salazar Company is a job-order costing firm that...Ch. 5 - Lorrimer Company has a job-order cost system. The...Ch. 5 - CleanCom Company specializes in cleaning...Ch. 5 - Prob. 23ECh. 5 - Geneva, Inc., makes two products, X and Y, that...Ch. 5 - Prob. 25ECh. 5 - During May, the following transactions were...Ch. 5 - Firenza Company manufactures specialty tools to...Ch. 5 - Prob. 28PCh. 5 - Cherise Ortega, marketing manager for Romer...Ch. 5 - Lieu Company is a specialty print shop. Usually,...Ch. 5 - Warrens Sporting Goods Store sells a variety of...Ch. 5 - Sutton Construction Inc. is a privately held,...Ch. 5 - Dr. Alyx Hemmings is employed by Mesa Dental. Mesa...Ch. 5 - Prob. 34P
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- Which of the following items would not be considered a manufacturing cost? Cream for an ice cream maker. Sales commissions for a car manufacturer. Plant property taxes for an ice cream maker. Tires for an automobile manufacturer.arrow_forwardValue chain classifications Match each of the following cost items with the value chain business function where you would expect the cost to be incurred: Cost Item Answer Business Function a. Research and development b. Design c. Production d. Marketing e. Distribution t Customer service 1. Labor time to repair products under warranty 2. TV commercial spots 3. Labor costs of filling customer orders 4. Testing of competitor's product 5. Direct manufacturing labor costs 6. Development of order tracking system for the Internet 7. Printing cost of new product brochures 8. Hours spent designing childproof bottles 9. Training costs for representatives to staff the customer call center 10. Installation of robotics equipment in manufacturing plantarrow_forwardIn this assignment, you are asked to consider impacts of COVID-19 by looking-up a company/firm of your choosing and thinking through the following questions to include in your post to this discussion topic: 1) Name of the company/firm. Identify as the title of your post (click "reply" to this discussion). 2) Identify the industry or company type (i.e. manufacturing; merchandising; service). 3) Which costs do you think would be impacted and why? Be specific with your examples (i.e. variable, fixed, materials, labor, overhead, non manufacturing…). 4) What kind of variances would you expect to see when compared to the budgets created prior to COVID-19 (favorable or unfavorable) and why? Be specific with your examples. Keep in mind not all industries were seeing declines in net operating income due to Covid-19. Some industries turned to increased hiring and showed increases in revenues (for instance, grocery stores).arrow_forward
- Which of the following is not a reason for banks to use activity-based costing? a.to determine service quality b.to determine profitability of services provided c.to determine the amounts charged to customers for services provided d.All of these choices are correct.arrow_forwardWhich of the following is not a key difference between front office and back office? Select one: i. Back office aims at cost reduction. iii. Back office helps in increasing demands and sales. iv. Front office has direct involvement and interaction with customers. v. Front office main duty is selling and interacting with the clients of the company. vi. Front office is a section which directly interacts with customers.arrow_forwardValue chain classifications Match each of the following cost items with the value chain business function where you would expect the cost to be incurred: Business Function Cost Item Answera. Research and development 1. Labor time to repair products under warrantyb. Design 2. TV commercial spotsc. Production 3. Labor costs of fi lling customer ordersd. Marketing 4. Testing of competitor’s producte. Distribution 5. Direct manufacturing labor costsf. Customer service 6. Development of order tracking system forthe Internet7. Printing cost of new product brochures8. Hours spent designing childproof bottles9. Training costs for representatives to staff the customer call center10. Installation of robotics equipment in manufacturing plantarrow_forward
- Manufacturing firms must calculate their cost of goods sold based on how much they manufacture and how much it costs them to manufacture those goods. This requires manufacturing firms to prepare an additional statement before they can prepare their income statement. This additional statement is the Cost of Goods Manufactured statement. Once the cost of goods manufactured is calculated, the cost is then incorporated into the manufacturing firm’s income statement to calculate its cost of goods sold. One thing manufacturing firms must consider in their cost of goods manufactured is that, at any given time, they have products at varying levels of production: some are finished and others are still process. The cost of goods manufactured statement measures the cost of the goods actually finished during the period, whether or not they were started during that period. True / False Even though the income statements for the merchandising firm and the manufacturing firm appear very similar at…arrow_forwardMatch each of the following types of companies with its definition. Types of Companies Definitions 1. Service company 2. Merchandising company 3. Manufacturing company a. Purchases goods that are primarily in finished formfor resale to customers.b. Records revenues when providing services tocustomers.c. Produces the goods they sell to customers.arrow_forward1. In what way does a typical manufacturing business differ from a merchandising concern? In what ways are they similar? 2. What are the basic elements of production cost? 3. Define the following costs: a. Direct materials b. Indirect materials c. Direct labor d. Indirect labor e. Factory overhead 4. Give examples of variable overhead and fixed overhead costs. 5. Consider education as a product. What are the direct costs and the indirect costs to a university in educating a student?arrow_forward
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