managers plan for variable overhead costs? Managers plan for variable overhead changes with the level of activity‚ so if managers think they are overspending on variable overhead‚ managers are able to slow or stop the production process and investigate. If some reason a company needs to increase production‚ managers have to check and add variable overhead as needed. 1. How does the planning of fixed overhead cost differ from the planning of variable costs? Fixed overhead costs involve
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that drives costs at Salem Data Services. Which expenses in Exhibit 2 are variable with respect to revenue hours? Which expenses are fixed with respect to revenue hours? Variable: Wages of hourly personnel‚ Power Fixed: Rent‚ custodial services‚ computer leases‚ maintenance‚ depreciation‚ salaried staff wages‚ administration‚ sales‚ systems development‚ sales promotion‚ corporate services 2.) For each expense that is variable with respect to revenue hours‚ calculate the cost per revenue
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Statements 1. The variable overhead flexible-budget variance subdivides into which two variances? Spending Variance and efficiency Variance. 2. To compute the budgeted variable overhead cost rate for a manufacturing company divide budgeted variable overhead costs by the budgeted quantity of the Cost allocation base. 3. To compute the budgeted fixed overhead cost rate for a manufacturing company‚ divide budgeted fixed overhead costs by the Budgeted total quantity of cost-allocation base or Production-
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of past decisions. ▪ The provision of information which explains current trends. ▪ The provision of information for decision making. ▪ The provision of information for planning and control. Traditionally management accounting provided cost information to management for the control and decision making process. The concern of the management accountant today is much wider and includes the provision of both financial information and non-financial information. Management accounting is
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2 AN INTRODUCTION TO COST TERMS AND PURPOSES 2-1 A cost object is anything for which a separate measurement of costs is desired. Examples include a product‚ a service‚ a project‚ a customer‚ a brand category‚ an activity‚ and a department. 2-2 Direct costs of a cost object are related to the particular cost object and can be traced to that cost object in an economically feasible (cost-effective) way. Indirect costs of a cost object are related to the particular cost object but cannot be traced
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future revenues‚ costs‚ and other measures to forecast activities and their results. B. provides information about the company as a whole. C. reports information that has occurred in the past that is verifiable and reliable. D. provides information that is generally available only on a quarterly or annual basis. 3. Within the relevant range‚ if there is a change in the level of the cost driver then A. fixed and variable costs per unit will change
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This work ACC 561 Assignment Wiley Plus Week 4 includes answers to these exercises: BE18-1 Monthly production costs in Pesavento Company for two levels of production are as follows. BE18-7 Bruno Manufacturing Inc. has sales of $2‚200‚000 for the first quarter of 2010. In making the sales‚ the company incurred the following costs and expenses BE18-11 For Dousmann Company actual sales are $1‚200‚000 and break-even sales are $840‚000. Compute the following (a) the margin
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(pounds) | 200000 | 225000 | 225000 | 0 | Revenue | 1600000 | 1800000 | 1777500 | 22500 U | Direct Material | 290000 | 326250 | 432500 | -106250 U | Direct Labor | 168000 | 189000 | 174000 | 15000 F | Variable Overhead | 324000 | 364500 | 375000 | -10500 U | Total Variable Costs | 782000 | 879750 | 981500 | -101750 U | Contribution Margin | 818000 | 920250 | 796000 | 124250 U | CALCULATION Revenue = 225000 X 8.00 per pound = 1800000 Direct material (quantity) =290000
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from a local printing shop when necessary. The cost of using the equipment is $350. The materials used in one shirt cost $8‚ and Gina can sell these for $15 each. (a) If Gina sells 20 shirts‚ what will her total revenue be? What will her total variable cost be? (F) Fixed Cost= $350.00 (V) Variable Cost= $8.00 (S) Selling Price= $15.00 (X) Number of Units Sold= 20 Revenues = (S)(X) = (15)(20) = $300.00 Total Variable Cost = (V)(X) = (8)(20)
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to fixed cost plus variable cost. This concept is further explained by the the following equation: [Break even sales = fixed cost + variable cost] The break even point can be calculated using either the equation method or contribution margin method. These two methods are equivalent. Equation Method: The equation method centers on the contribution approach to the income statement. The format of this statement can be expressed in equation form as follows: Profit = (Sales − Variable expenses)
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