Chapter 4 Case 2: Greetings Inc.: Activity-Based Costing Solution: 1. An activity-based costing system may be appropriate for Wall Décor‚ when overhead allocation based job-order costing provides product cost distortion. As seen on previous case‚ this distortion happens when one product is manufacturing in high volume and the others are manufacturing in complexity as well as in low volume. In this situation Wall Décor should change its costing system for selling its high volume produced
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63 TRANSPORTATION PROBLEMS 63.1 INTRODUCTION A scooter production company produces scooters at the units situated at various places (called origins) and supplies them to the places where the depot (called destination) are situated. Here the availability as well as requirements of the various depots are finite and constitute the limited resources. This type of problem is known as distribution or transportation problem in which the key idea is to minimize the cost or the time of transportation
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ABC case study: Plum Electronics Plum Electronics‚ a division of Berry Corporation‚ manufactures two large-screen television models: the Mammoth‚ which has been produced since 2009 and sells for $990‚ and the Maximum‚ a newer model introduced in early 2011 that sells for $1‚254. Based on the following income statement for the year ended November 30‚ 2013‚ senior management at Berry have decided to concentrate Plum’s marketing resources on the Maximum model and to begin to phase out the Mammoth model
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1. I would allocate the purchase price based on the fair market value of the assets on the date of acquisition. FASB standard 141R establishes the acquisition-date fair value as the measurement objective for all assets acquired. I would tell Nella to allocate 89% to the undeveloped acreage‚ 1% to the 500 finished lots and 10% to the recreation facility (see schedule below.) The $33‚000‚000 acquisition costs would be allocated as follows: Undeveloped Acreage- $ 29‚370‚000 500 Finished Lots-
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Proposed research topic: The implication of conditional betas on the Fama-French three factor model Introduction CAPM has been an active area of research over the past half century since the introduction of Sharpe development of the capital asset pricing model. Much progress has been made in the early years on the linear relationship between expected return and beta(Black‚ Jensen and Scholes 1972 and Fama and MacBeth 1973). Later studies however show weak empirical evidence on these relationships
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Acct 3230 Quiz # 1 Name-------SOLUTIONS------------------------------ Winter 2011 1) On occasion‚ the FIFO and the weighted-average methods of process costing will result in the same dollar amount of costs being transferred to the next department. Which of the following scenarios would have that result? A) when the beginning and ending inventories are equal in terms of unit numbers B) when the beginning and ending inventories are equal
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The Paper Products Factory Memo To: Brian Clark From: 930 cc: Matt Brady Date: Re: Job Cost Allocations Mr. Clark‚ It is my conclusion that the method of job costing directly correlates with Mr. Brady’s sales performance. That is‚ with the addition of a new product line with shared factory overhead‚ the company can no longer use units to allocate overhead without first allocating the overhead between the two products. It will reflect unfairly to the hats department because it will
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at the Dialysis Center. The hospital allocates facilities costs (which primarily consist of building depreciation and interest on long-term debt) on the basis of square footage. Currently‚ the facilities cost allocation rate is $15 per square foot‚ so the facilities cost allocation
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A REPORT ON Case Study on Measuring Intangible Assets – Indian Experience - 1 - BEYOND BALANCE SHEETS… Measuring Intangible assets- an Indian case study “Just as you can ’t measure what you can ’t describe‚ you can ’t manage what you can ’t measure...” While many companies have strived to differentiate their annual reports and make them informative‚ attractive and easy to read‚ most still take a rear-view-mirror approach‚ focusing almost exclusively on history and analyses of past performance
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gateway-package revenue to the three divisions using: a. The stand-alone revenue-allocation method | Selling Price | Rev. Allocation | Precio por cuarto para dos personas 2 noches | $800 | $581.82 | Dos “rounds” de golf con precio de | 375 | 272.73 | Una cena para dos | 200 | 145.45 | | $1‚375 | $1‚000 | b. The incremental revenue-allocation method | Selling Price | Rev. Allocation | Dos “rounds” de golf con precio de | $375 | $375 | Precio por cuarto para
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