Destin Brass Products Co. 1) Estimated Product costs per unit: Number of Units 7500 12500 4000 Valves Pumps Flow Controllers Material Overhead Receiving $600.00 $3‚800.00 $15‚600.00 Materials Handling $6‚000.00 $38‚000.00 $15‚600.00 Manufacturing Overhead Packing and Shipping $1‚800.00 $13‚800.00 $43‚800.00 Engineering $20‚000.00 $30‚000.00 $50‚000.00 Maintenance $10‚500.00 $17‚400.00 $2‚100.00
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percentage is 66.1%‚ which means 66.1 percent of each sales dollar is available for covering fixed costs and making income: $1‚365‚650/66.1%=$2‚065‚387 sales are needed to break even. Based on the existing sales mix and production units given (Valves 7‚500‚ Pumps 12‚500 and Flow Controllers 4‚000)‚ the break-even prices in dollars (BEP$) are shown as below: Therefore‚ based on the data above‚ if the company cut its prices to just cover short-term variable costs‚ the company’s total sales would
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ujy89ui uiyuioj 1. ABC Industries Ltd. has enjoyed a moderate but stable growth in sales and earnings. Because of a stiff competition recently in its polythene fibres product line‚ its sales have been declining. So it plans for developing a new diversified product line. Dividend per share given by the company is Rs.2.5 Dividend policy has been to maintain a stable rupee dividend. What would be an appropriate dividend policy for ABC Industries Ltd.? Ans. The management of ABC Industries Ltd should
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Wilkerson Company 1. What is the competitive situation faced by Wilkerson? The critical product in term of market competition is the pumps of Wilkerson Company. The pumps are Wilkersons major product line with a production of about 12‚500 units per month. Pumps currently have the lowest gross margin among all products‚ because competitors had been reducing prices on pumps and Wilkerson adopted its prices in order to remain competitive and to maintain the volume. 2. Given some apparent problems with
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competitive trends of the company products. He and his staff are worried that company profits are falling in regards to these competitive problems. Analysis: Destin Brass Company manufactures three items dealing with water purification systems: valves‚ pumps‚ and flow controllers. The company has been seeing some problems dealing with competition within some of the product markets they produce. Ronald Guidry had two basic questions they wanted answered dealing with this case: 1. Why was
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eady using‚ looking for a way in which they can be more competitive on the market. Cover page Table of Content 1. Use the Overhead Cost Activity Analysis in Exhibit 5 and other data on manufacturing costs to estimate product costs for valves‚ pumps‚ and flow controllers Q. 1 When Activity Based Costing (Weetman‚ 2010‚ p. 85) is used to calculate the monthly cost per unit‚ two types of costs are distinguished. Firstly the direct costs‚ consisting of the direct manufacturing costs and the run labor costs
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The Sippican Corporation Case Study (A) Management Summary Sippican Corporation - a supplier of valves‚ pumps‚ and flow controllers to manufacturers of water purification equipment – faced concerns due to the fact that its competitors have been reducing the price of pumps‚ which was a major product line. According to Sippican’s cost accounting system further decrease in the price of pumps would not be acceptable as because of the past price reductions the margin on pumps have already declined from
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Company (ABC) has the hottest new products on the upscale toy market -- boys’ and girls’ bikes in bright fashion colors‚ with oversized hubs and axles‚ shell design safety tires‚ a strong padded frame‚ chrome-plated chains‚ brackets and valves‚ and a nonslip handlebar. Due to the seller’s market for high-quality toys for the newest baby boomers‚ ABC can sell all the bicycles it manufactures at the following prices; boys’ bikes -- $220‚ girls’ bikes -- $175. This is the price payable to ABC at its Orlando
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Cause of the shifts in values. Q4. What actions should the management take to improve Sippican’s profitability? 3 Company overview • Sippican is a company manufacturing hydraulic control devices: valves‚ pumps and flow controllers • Recent trends (March 2006) Valves: margin remained at standard 35% Pumps: Sippican’s main business‚ gross margin fell to 5% (below expect. 35%) Flow controllers: price increase by 10% with no effect on demand • Issue Sippican had to react to
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1. Wilkerson company ‘s major productions are pumps‚ valves and flow controllers. Pumps: The competitors had been reducing prices on pumps. Since pumps were a commodity product‚ the company matches the reduced prices to maintain volume. However‚ it has dropped pre-tax margin to less than 3%. Valves: Although several competitors could match its quality‚ none had tried to gain market share by cutting price‚ the gross margin had been maintain at standard 35%. Flow controllers: There was much more
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