both relevant and irrelevant costs and it is important to identify them separately. So here the meanings of relevant and irrelevant costs have been discussed. Activity based costing is another method in cost accounting and it contains both benefits and problems. Here in this report benefits and problems of activity based costing have also been mentioned. As per (Norton and Hughes‚ 2009:p.3) strategy can be defined as a course of action‚ set to achieve a specific objective which includes specification
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Description In ACC 301‚ you discussed the Dakota Office Products (DOP) case and were asked to design the ABC system. For this assignment in BCOM 250‚ you will take what you learned in ACC 301 and write a report recommending that DOP use activity-based costing to determine its pricing to customers. You do not need to go into deep detail about how you would design the ABC system. You will work with a team of 4-5 people to produce this deliverable. Assume that your group is part of the accounting staff at
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ACCOUNTING TOOLS FOR BUSINESS DECISION MAKING SIXTH EDITION MANAGERIAL This page intentionally left blank Jerry J. Weygandt PhD‚ CPA University of Wisconsin—Madison Madison‚ Wisconsin Paul D. Kimmel PhD‚ CPA University of Wisconsin—Milwaukee Milwaukee‚ Wisconsin John Wiley & Sons‚ Inc. Donald E. Kieso PhD‚ CPA Northern Illinois University DeKalb‚ Illinois Dedicated to the Wiley sales representatives who sell our books and service our adopters in a professional and ethical
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1. Unit based costing first assigns overhead costs to departmental pools and then assigns these costs to products using predetermined overhead rates. a. True b. False ANSWER: True 2. Management information systems can be divided into a unit-based type and activity-based type. a. True b. False ANSWER: True 3. Predetermined overhead rates are calculated at the end of each year using the formula: overhead rate = budgeted annual driver level/budgeted annual driver level. a. True b. False ANSWER:
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$500‚000 $520‚000 Direct Labor Hours 300‚000 hrs. 290‚000 hrs. The factory uses a predetermined overhead rate per direct labor hour to apply factory overhead. During the year jobs which cost $1‚200‚000 were completed‚ and finished goods costing $1‚000‚000 were sold. No inventories were on hand at the beginning of the year. Determine the ending balance of Work-In-Process: a. $400‚000 b. $425‚000 c. $480‚000 d. $580‚000 2. At the beginning of 2013‚ Sparky Company had direct
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1. If Wilkerson were to cut prices‚ based on contribution margin‚ to just cover short-term variable costs‚ what consequences could it experience? (5 marks) Several break-even-point assumptions are made in calculation: 1) Total fixed costs do not change with volume‚ and will exist regardless if the products are sold or not. 2) Sales mix will be constant. The contribution-margin percentage is 66.1%‚ which means 66.1 percent of each sales dollar is available for covering fixed costs and making
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Sippican Corporation According to the activity based costing‚ the manufacturing overhead should be apportioned in the following method The Direct Material cost per unit and the direct labour cost per unit for the valves‚ pumps and the flow controller is given below. Direct Material Direct Labour Total Units Cost/unit cost/unit Valves 7500 16 12.35 Pumps 12500 20 16.25 Flow Controller 4000 22 13 The total manufacturing overhead of $654600 should be apportioned based on the activity required for
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References: Latshaw‚ C. A.‚ & Cortese-Danile‚ T. M. (2002). Activity-Based Costing: Usage and Pitfalls. Review of Business‚ 23(1)‚ 30. Retrieved from EBSCOhost.
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outcomes (a)Have knowledge and understanding of… - the behaviour of costs; - the techniques and uses of marginal and absorption costing; - the process of budgetary control; - the preparation and interpretation of financial accounting reports b) Skills and attributes. Be able to…. - prepare costing statements using both marginal and absorption costing; - explain the usefulness of such statements for accounting and decision-making; - prepare a cash budget; - explain the process of
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reduce production cost they planned to shift the production from Geoffrey dolls to specialty dolls. The firm was based on the traditional cost system which allocated all the overheads on the basis of direct labor cost. For the Chicago plant this costing system was not appropriate. The new ABC system is recommended for the plant which showed that as the margin from specialty dolls is only 3%; it should be closed down. Using these new results it is recommended that more Geoffrey dolls be produced.
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