Reference no: EM132451306
As EEC's corporate business financial analyst, you will need to have a clear understanding of the different types of costs (variable, fixed, and mixed) that the company carries. Complete the following for this assignment:
1. Review EEC's journal activity.
2. Define and identify its variable, fixed, and mixed costs.
3. Determine what affect a sales volume increase or decrease will have on unit fixed cost, unit variable cost, total fixed cost, and total variable cost.
- Click here to view EEC's journal activity.
Part 2
As an EEC corporate business financial analyst, you must have an expert understanding of the various costing methods. Select 1 of the following costing concepts:
- Full costing or absorption costing
- Variable costing
- Target costing
- Life cycle costing
- Activity-based costing
Respond to the following questions on the costing concept that you selected:
1. Provide the definition of the concept.
2. Discuss how and when the concept could be used by EEC.
3. Discuss the advantages and disadvantages of the concept as it relates to EEC.
4. Eddison Electronic Company
Journal Entries 2005 "000" Omitted
Activity
1 Sales not on account $29,440
2 Sales on account 28,060
3 Selling Expense 3,220
4 Administrative Expense 6,210
5 Supplies Factory 3,450
6 Insurance Factory 920
7 Indirect Labor 6,900
8 Factory Salaries 288
9 Factory Property Tax 173
10 Maintenance Expense Factory 2,001
11 Depreciation Expense Factory 3,726
12 Utilities Factory 828
13 Purchases of Raw Materials 17,250
14 Direct Labor Factory 3,450
15 Raw Material Inventory, January 1 2,070
16 Raw Material Inventory, December 31 1,380
17 Work in Process Inventory, January 1 4,140
18 Work in Process Inventory, December 31 2,300
19 Finished Goods Inventory, January 1 5,980
20 Finished Goods Inventory, December 31 4,830
21 Bad Debt Expense 276
22 Accounts Receivable, net 9,430
23 Prepaid Expenses 840
24 Land 2,760
25 Plant and Equipment 37,950
26 Cash 1/1/05 4,646
27 Accounts Payable 14,410
28 Interest Expense 28
29 Notes Payable, 10% 2,070
30 Bonds Payable 8% 8,510
31 Stockholders' Equity 31,510
32 Retained Earnings 6,670
33 Income tax rate 30%