Cost Allocation Problems Problem 1: The laboratory services department for Swank Medical Systems has $300,000 in direct costs during 2012. These costs must be allocated to Swank’s three revenue producing patient services departments using the direct method. Two cost drivers are under consideration; patient services revenue and hours of laboratory services used. The patient services departments generated $6 million in total revenues in 2012, and to support these clinical activities, they used
Words: 591 - Pages: 3
Month in a year | 12 | | | | | | | | | | | Monthly production and cost summary | | | | | | | Valves | Pumps | Flow Controllers | Monthly Total | | Monthly production | 7,500 | 12,500 | 4,000 | | | Runs | 1 | 5 | 10 | | | Monthly shipments, units | 7,500 | 12,500 | 4,000 | | | Monthly shipments | 1 | 7 | 22 | | | Manufacturing costs: | | | | | | Components | 4 | 5 | 10 | | | Material | $16 | $20 | $22 | $458,000 | | Labor
Words: 349 - Pages: 2
Issues 1. (a) What would you tell Bates concerning her accounting needs? b) What businesses are being operated in the boatyard? c) What is the accounting impact of those businesses? 2. Future - What kind if accounting system is needed for the growth of the boatyard? Facts • Bates bought the boatyard using her savings and also a private mortgage • Bates realized the need for and adequate accounting system • Record on show just cash receipts and disbursements
Words: 329 - Pages: 2
1. What are the strengths and weaknesses of the target costing system? First, target costing originally starts with mangers estimate the cost that customers are willing to pay and how competitor will price the same products or services. (Cost Accounting. Page 545). In the Nissan case, customers are very knowledgeable because the customer demand requires more variations and model types of automobiles. This is a favorable market for Nissan. Nissan managers can set an expected profit margin because
Words: 1544 - Pages: 7
Target costing is a system of profit planning and cost management. The required features and performance of the proposed product are established. Then target costing determines the life cycle cost at which the product must be produced, to generate the firm’s desired level of profit. Given the product’s anticipated selling price (Cooper and Slagmulder,1999, p.166). Note that target costing is not a method for product costing , it is a technique for cost management. It was devised in Japan, where it is
Words: 1127 - Pages: 5
Xi’an Jiaotong-Liverpool University International Business School Suzhou Feasibility Report on Employing Strategic Management Accounting in Davis Ltd Instructor: Dr. Brain Wright Student Name : Yunyu Xu : Qinyi Zuo : Mengqi Hang : Shuting Chen : Yang Liu : Shufan Xue : ID Number 1200742 1200745 1200746 1200749 1200752 1200766 Contents Contents 1 1 Introduction 2 2 Current Process 3 3 Analysis & Results 3.1 Performance Prism (PP) . . . . . 3.1.1 Stakeholder satisfaction . 3.1.2 Stakeholder
Words: 2007 - Pages: 9
Harvard Business School 9-195-165 Rev. April 21, 1998 AT&T Paradyne Our Design and Manufacturing Engineering groups are using Activity-Based Cost (ABC) along with quality and cycle time information to make life-cycle cost decisions. —ABC/ABM Team Leader The Company AT&T acquired Paradyne Corporation, a company specializing in the data communications equipment, in February, 1989. Operating as a wholly-owned AT&T subsidiary, AT&T Paradyne designed and produced medium-and high-speed
Words: 6152 - Pages: 25
performance assessment was based on how well actual revenues matched actual costs rather than factor in complaints issues by frustrated consultants Internal billings (transfer prices) from CS to groups were of two types: a monthly rental charge levied at the group level and a usage charge levied at the project level Profit Center A profit center is a part of a business that generates revenue while also taking on its own costs,
Words: 1534 - Pages: 7
senior citizens. The report will identify key issues that may impact Carson Manor’s day-to-day operation on the basis of budgeting, cost control and cost measurement. The key issues will be analyzed against Carson Manor’s objective to outsource a solution provider to conduct a review of their current situation. This report will evaluate three bidders based on total cost of study, potential savings, possible implementation, experience and references. A recommendation is stated at the end of the report
Words: 313 - Pages: 2
Solutions Division of ERIKS. | | Since its creation in 1997, ERIKS Integrated Solutions Division has successfully managed client´s MRO Procurement functions as well as their MRO stores operations. These activities have generated significant total cost down benefits for many clients over the past 10 years, with the division currently operational on site at 100 manufacturing locations across the UK and Ireland. Own Role My own role is currently as “Assistant Contract Manager”, where I assist the
Words: 1311 - Pages: 6
