Calculate the amount of the final price adjustment because of defective pricing based on the following:
Contractor unintentionally overpriced their material costs by $75,000 and under-priced their direct manufacturing labor costs by $50,000. Overhead rates used to price the original contract are given below:
Material OH 15%
Engineering OH 75%
Manufacturing OH 124%
Lawn Maintenance OH 1.5%
G & A 24%
Solution Preview
Let us consider that the costs for Material, Engineering, Manufacturing and Lawn Maintenance were originally X, Y, Z and W respectively.
Total Cost Input = (X + 15% of X) + (Y + 75% of Y) + (Z + 124% of Z) + (W + 1.5% of W)
= 1.15X + 1.75Y + 2.24Z + 1.015W
Total Cost = ...
Solution Summary
Solution starts with representing the original costs for Material, Engineering, Manufacturing and Lawn Maintenance by variables and then develops a formula to compute the final price adjustment because of defective pricing.
... 2. Calculate the amount of the final price adjustment because of defective pricing. Labor was overpriced by $15,000. Material was under-priced by $10,000. ...
... The amount of adjustment is determined by principles explicated in ... cost, a target profit, a price ceiling, and ... between target costs and actual final costs will ...
... a smooth flow at the teller, what adjustments if any ... will have to be replaced later at a cost of $10 each when they are detected in final Product testing. ...
... document to assist you with your final editing. ... No consideration for defect or breakage has been applied ... It is considered customary to adjust cost estimates by ...
... That is adjust for sample size for each book type. ... A major cost factor in the purchase of a home is ... Before making a final decision, a sample of recent loans is ...
... Week, which will give you time to make adjustments. ... Your Final Project should also include a section on ... are delivered to avoid disruptions, the price of the ...
... ensures assessments are conducted in a cost effective, efficient ... At a minimum, the final report should be distributed to ... used in a variety of settings to solve ...
... or obsolete items should be recorded and final entry in ... by the production department making due adjustment to reorder ... This would ensure best price for purchase ...
... but said that the company "felt some adjustment of this ... parts of the inventory, at a nominal price or at ... As part of these amendments, the final sentence of ...
