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Management Accounting

Managerial Economics

Your company has developed a drug called Matrox that is an effective treatment for migraine headaches. You have just discovered that it can also be used for organ transplant patients to reduce the risk of organ rejection. The demand for migraine medications is considerably more elastic than the demand for drugs to reduce the ri

Managerial Accounting Travis Corporations

Compute ROI per Unit 1. Travis corporation produces high- performance rotors. It expects to produce $50,000 rotors in the coming year. It has invested $ 1,000,000 to produce rotors. The company has a required return on investment of 18% what is its ROI per unit? Compute markup percentage 2. Shandling corporation produces mi

Patent costs

Redstone Company spent $190,000 developing a new process, $40,000 in legal fees to obtain a patent, and $91,000 to market the process that was patented. How should these costs be accounted for in the year they are incurred?

intermediate accounting practice questions

1. The cost of an intangible asset includes all of the following except a. purchase price. b. legal fees. c. other incidental expenses. d. all of these are included. 2. When a patent is amortized, the credit is usually made to a. the Patent account. b. an Accumulated Amortization account. c. a Deferre

Cost allocation

The following are production and cost data for two products, X and Y. Product X Product Y Contribution margin per unit $450 $280 Machine set-ups needed per unit? 25 14 The company can only perform 14,000 set-ups each period yet there is unlimited demand for each product. What is the maximum contribution margin for t

Costing/Cost Function

Jersey Subs, Inc. wants to find an equation to estimate monthly utility costs. Jersey Subs has been in business for one year and has collected the following cost data for utilities: (see attached table) a. Which of the preceding costs is variable? Fixed? Mixed? Explain. b. Using the high-low method, determine the cost

Budgets in Managerial Accounting: Santiago's Salsa

Santiago's Salsa is in the process of preparing a production cost budget for May. Actual cost in April were: Santiago's Salsa Production Costs April 2011 25,000 Production Jars of Salsa Ingredients cost

IT Management Restraints

1.) What are reasonable kinds of restraints imposed on IT projects by management? What unreasonable restraints are sometimes encountered? 2.) Does it matter how much technical expertise top managers have in the area of information technology management in terms of the quality of their supervision of the process? 3.) To what

Rondell Pharmacy: Managerial Accounting: Break-even and Cost Structure

1.) "Breakeven analysis isn't very useful to a company because companies need to do more than break even to survive in the long run." Explain why you agree or disagree with this statement. 2.) Rondell Pharmacy is considering switching to the use of robots to fill prescriptions that consist of oral solids or medications in pil

EM, Inc. Kool Clothing: Standard cost variances

1. EM, Inc. private labels mini cupcakes for Starbucks. For April 2012, it budgeted to purchase and use 18,000 pounds of flour at $0.39 a pound. Actual purchases and usage for April 2012 were 22,000 pounds at $0.42 a pound. EM budgeted to produce 120,000 mini cupcakes. EM budgets to obtain 4 mini-cupcakes per pound of flour.

Cost Behavior

Roland Andersson is the manager of the Ekland Division of Ystad Industries. He is one of several managers being considered for position of CEO, as the current CEO is retiring in a year. All divisions use standard absorption costing. The division has the capacity to produce 50,000 units a quater and quarterly fixed overhead am

Details of Make Versus Buy Decisions

Pepsi Company purchases 8,000 units of a part that it needs for production of its product. Notification has just been received from the supplier that a price increase will take effect shortly, which will bring the price of each part to $25. Pepsi Company is considering using some idle facilities to produce the part. The producti

Calculate: Total Direct Labour Cost

Question: Energy Inc. is working on its direct labor budget for the next two months. Each unit of output requires 0.77 direct labor-hours. The direct labor rate is $11.20 per direct labor-hour. The production budget calls for producing 7,100 units in October and 6,900 units in November. The company guarantees its direct labor wo

Managerial Accounting Sample Problems

Please see the document. 1. Harrow Inc. produces a single product and has the following cost structure: The absorption costing unit product cost is: 2. Jones Company produces a single product and has provided the following data concerning its most recent month of operations: What is the net operating income for th

Equivalent Units and Cost per Equivalent Units

Production and cost data for the month of February for process A of the Packer manufacturing Company follow: Units in process, February 1 (100% complete with respect with materials; 25% complete with respect to conversion cost) 2,000 New units started in process

Determining What is the Equipment's Net Present Value

3. A piece of new equipment will cost $70,000. The equipment will provide a cost savings of $15,000 per year for ten years, after which it will have a $3,000 salvage value. If the required rate of return is 14%, what is the equipment's net present value? See the attached file.

The repair cost was inappropriately capitalized

During the first month of its current fiscal year, Green Co. incurred repair costs of $21,000 on a machine that had 5 years of remaining depreciable life. The repair cost was inappropriately capitalized. Green Co. reported operating income of $165,000 for the current year. Required: (a) Assuming that Green Co. took a f

Explain how three internal governance mechanisms -ownership concentration, the board of directors, and executive compensation--are used to monitor and control managerial decisions. Explain why ownership has been largely separated from managerial control in the modern corporation.

Explain how three internal governance mechanisms -ownership concentration, the board of directors, and executive compensation--are used to monitor and control managerial decisions. Explain why ownership has been largely separated from managerial control in the modern corporation.

Cost Behaviour Using a Scatter Diagram

Phenix Corporation reports the following information about its sales and cost of sales. Draw an estimated line of cost behavior using a scatter diagram, and compute fixed costs and variable costs per unit sold. Then use the high-low method to estimate the fixed and variable components of the cost of sales. Period Units Sol

Activity-based costing system.

Murri Corporation has an activity-based costing system with three activity cost pools-Processing, Setting Up, and Other. The company's overhead costs, which consist of factory utilities and indirect labor, are allocated to the cost pools in proportion to the activity cost pools' consumption of resources. Costs in the Processing

Management Accounting Practice Exam

1. When an organization involves its many employees in the budgeting process in a meaningful way, the organization is said to be using an approach most commonly known as: a. participative budgeting. b. budget padding. c. imposed budgeting. d. employee-based budgeting. 2. A budget serves as a benchmark against which: a. a

Explicit opportunity cost

Oliver Kamp has just made the final payment on his mortgage. He could continue to live in the home; cash expenses for repairs and maintenance (after any tax effect) would be $500 monthly. Alternatively, he could sell the home for $200,000 (net of taxes), invest the proceeds in 5% municipal tax-free bonds, and rent an apartment f

Managerial Accounting for Waller Inc - FIFO method

Waller Inc. uses the FIFO method in its process costing system. Data concerning the first processing department for the most recent month are listed below: Beginning work in process inventory: Units in the beginning work in process inventory 600 Materials costs $ 4,200 Conversion costs $ 7,800 Percent complete with resp