Computing cost to evaluate items using decrement factor

Reference no: EM1310535

Q1) You are re-examining a cost proposal that includes the $800,200 direct material estimate. After initial examination of proposal, you note that there are 500 material items, but you also note that 20 high-cost items account for $620,000 of the total. Remaining $180,200 is spread across 480 relatively small purchases.

Q2) Examination of 20 high-cost items (estimated at $620,000) illustrates that all are correctly priced except one item. That item is overpriced by= $20,000. What must be your objective for these 20 items?

Q3) After analyzing a sample of remaining 480 items, you determine that sample is overpriced by 6%. By using this 6% decrement factor, what cost must you evaluate for those items? Keep in mind that average sample item cost is= 106% of what it ought to be.

Reference no: EM1310535

Questions Cloud

Formal mission statement about soft-wear, limited : Explain how do the information systems help the people working individually and in groups make the decisions more efficiently? Write down a formal mission statement about the Soft-Wear, Limited (SWL).

Several events which influence the cash flows : Future cash flows are, in many cases, subject to change. List several events that could occur that might influence the cash flows in this situation.

What would the effective annual rate : what would the effective annual rate on this loan be and what is Carroll's average collection period

Aversion to hamburgers : Meliza very soon developed an aversion to hamburgers, however not to the television program, because of what?

Computing cost to evaluate items using decrement factor : After analyzing a sample of remaining 480 items, you determine that sample is overpriced by 6%. By using this 6% decrement factor, what cost must you evaluate for those items?

Wan technologies for mobile user-to-office : WAN technologies for each of the Wilke’s three connectivity situations: mobile user-to-office, office to office, and home-to-office.

How much would its accounts receivable decline : How much would its accounts receivable decline and what cash flow from sales is expected in March

Net income of financial brokers partnership : Shue withdrew $240,000 as withdrawals and contributed equipment valued at $50,000 to the partnership. What was the net income of the Financial Brokers Partnership for 2008?

Mortality among children remains constant : If total mortality among children remains constant whereas the incidence of that mortality shifted from late childhood to untimely rates of fertility declined.

User Account

All Pages