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Management Accounting

Opportunity Costs: Defintion and its Application

Define opportunity cost and explain why it an important factor to consider in financial analysis. Cite an example in which it is not possible to measure exactly the opportunity cost of an alternative. Is it possible to measure exactly the opportunity cost of an alternative in most situations?

JIT manufacturing and cost savings

Bogden Company introduced JIT manufacturing last year and has prepared the following data to assess the benefits from the change. CATEGORY BEFORE THE CHANGE AFTER THE CHANGE production cycle time 68 days 30 days inventories $160,000 $4

Material price,usage and cost variances

Direct Material Variances-solving for price and usage variances. Fiberworks Company is a manufacturer of fiberglass toy boats. The company has recently implemented a standard cost system to isolate variances as soon as possible. During the month of August, the following results were reported for the production of 50,000 toy boa

Relevant Cost Analysis in a Variety of Situations

Antoine Company has a single product called Zero. The company normally produces and sells 80,000 Zero's each year at a selling price of $40 per unit. The company's unit cost at this level of activity is given below: Direct materials $9.50 Direct Labor 10.00 Variable manufacturing Overhead 2.80 Fixed manufactu

Dropping or Retaining a Tour

Pacific Tour operates tours throughout the US. Studies show that the tours are not profitable, and are considering dropping the tours to improve the company operating performance. Below is an income statement from a tour below: Ticket revenue 3,000 100% (100% seat capacity*40% occupancy* $75 ticket price per person) V

Special Order : explained

Attached Problem. 4. Vaden Company produces a single product. The cost of producing and selling a single unit of this product at the company's normal activity level of 50,000 units per month is as follows: Direct materials $32.50 Direct labor 7.20 Variable manufacturing overhead 1.30 Fixed manuf

Find original cost

Jill Norris is presently leasing a small business computer from Stark Office Equipment Company. The lease requires 10 annual payments of $2,500 at the end of each year and provides the lessor (Stark) with an 8% return on its investment. Assuming the computer has a ten-year life and will have no salvage value at the expiratio

Managerial Accounting Standard Costs

I really need help solving these problems. 1.) Poorly trained workers could have an unfavorable effect on which of the following variances? Labor Rate Variance Materials Quantity Variance a.) Yes

Managerial Economics for Remox Corporation

4. Remox Corporation is a British firm that sells high-fashion sportswear in the United States. Congress is currently considering the imposition of a protective tariff on imported textiles. Remox is considering the possibility of moving 50 percent of its production to the United States to avoid the tariff. This would be accom

Balance Sheet Information for Lextra Office Supplies

The questions are requires that all supporting figures are prepared using a spreadsheet and the Formula spreadsheet in all instances where you have used the spreadsheet package. Part A - Lextra Office Supplies The following information is provided for Lextra Office Supplies: a. Balance sheet information as of 30 June, 2008:

Woods and Waters Financial and Managerial Analysis

Please see attached spreadsheet for data. The Woods and Waters Company has two operating divisions, the Service Division and the Irrigation Division. The company evaluates the performance of its divisions using the Return on Investment (RoI) measure. The following information pertains to the two divisions as of the end of t

Finding the Acceptable Manufacturing Cost

Direct material = $25 Direct labor = $30 Manufacturing overhead = $45 ------------------------------- Total Cost = $100 Muck Duck Company wants to sell All-Body swimsuit. Market study showed that it could sell for $110/each. What is the highest acceptable manufacturing cost Muck Duck would be willing to incur to produc

Managerial Accounting

1. The type of costing that provides the best information for breakeven analysis is: 2. Gyro Gear Company produces a single product, a special gear used in automatic transmissions. Each gear sells for $28, and the company sells 500,000 gears each year. Unit cost data are presented below: Variable Fixed Direct mate

Cost Classification: Variable vs. Fixed

Please see ** ATTACHED ** file(s) for complete details!! Costs Product Period Variable Fixed Direct Indirect Raw materials Staples used to secure packed boxes of product Plant janitors' wages Order processing clerks' wages Advertising expenses Production workers' wages Production supe

Cash Conversion Cycle in Sharam Industries

Sharam Industries has a 120-day operating cycle. If its average age of inventory is 50 days, how long is its average collection period? If its average payment period is 30 days, what is its cash conversion cycle? Place all this information on a time line.

Reconstructing Standard-Cost Information For Partial Data

Part of your company's accounting database was destroyed when Godzilla attacked the city. You have been able to gather the following data from your files. Reconstruct the remaining information using the available data. All of the raw material purchased during the period was used in production. (Hint: It is helpful to solve for t

Comprehensive Standard Cost Variances

"It certainly is nice to see small variance on the income statement after all the trouble we've had lately in controlling manufacturing costs," said Sarah Jones, VP Shore INC." The $12,250 overall manufacturing variance reported last period is well below the 3% limit we have set for variances. We need to congratulate everybody o

Lock Box, Cash Conversion Cycle, Interest rate

1. What are the expected annual savings form a lock-box system that collects 300 checks per day averaging $800 each, and reduces mailing and processing times by 3.0 and 1.5 days respectively, if the annual interest rate is 7 %? 2. What is the receivables period for a firm with annual sales of $100 million, $8.4 million in ave

Activity Based Cost Drivers: EyeGuard Equipment Inc

Resource and Activity-Based Cost Drivers EyeGuard Equipment Inc (EEI) manufactures protective eyewear for use in commercial and home applications. The product is also used by hunters, home woodworking hobbyists, and in other applications. The firms has two main product lines?the highest-quality product is called Safe-T, and a

Advance, Inc: Calculate the cost of debt, pretax and aftertax

Calculate the Cost of Debt for Advance, Inc. The firm has a debt issue outstanding with 12 years to maturity that is quoted at 105 percent of face value. The issue makes semi-annual payments and has a coupon rate of 8 percent annually. What is Advance's pretax cost of debt? If the tax rate is 35 percent, what is the afterta

Fixed Cost Examined

1) If fixed costs suddenly increase, how will that change the graph of fixed costs if activity, units or volume is on the x-axis and dollars are on the y-axis? 2) Indicate whether the following statement is true or false, then support your view. If we graphed fixed costs per unit, it would appear as a straight, horizontal

Multiple Choice

1. Accrued liabilities are disclosed in financial statements by: a. Showing the amoutn among the liabilities but not extending it to the liability total b. Appropriately classifying them as regular liabilities in the balance sheet c. A footnote to the statements d. An appropriation of retained earnings 2. An imp

Relevant cost of making versus buying

James Co. has two divisions,A and B,each operate as a profit center.A charges B $35 per unit for each unit transferred to B. Other data for A are below: Variable cost per unit $30 Fixed costs $10,000 Annual sales to B 5,000 units Annual sales to outsiders

Discussion questions Management

1. The divisional structure enables firms to pursue complex corporate diversification strategies by delegating different management responsibilities to different individuals and groups within a firm. Will there come a time when a firm becomes too large and too complex to be managed even through a divisional structure? In other w

Quantitative Reasoning for Business

a. Manchester Foundry produced 45,000 tons of steel in March at a cost of £1,150,000. In April, the foundry produced 35,000 tons at a cost of £950,000. Using only these two data points, determine the cost function for Manchester following the instruction in my post in Materials. b. Use Excel's "scatter plot" graphing func

With the information given, compute the cost of direct materials

1. A company's overhead rate is 60% of direct labor cost. Using the following incomplete accounts, determine the cost of direct materials used Goods in Process Inventory Beginning Balance. 100,800 D.M. ? D.L. ? O.H. ? F.G. ? End Balance 131,040 Factory Overhead 93,24