Summary of manufacturing activity

Assignment Help Cost Accounting
Reference no: EM13534960

After Company Y's operating profit report and summary of manufacturing activity for the year has been prepared, you, the chief accountant, learn that $1,000,000 of raw materials were thrown away during the year because the items had spoiled and couldn't be used in the manufacturing process. The company's president knows about this loss and insists that no change be made in the operating profit report and summary of manufacturing activity. Do you go along with the president, or do you argue for changing the operating profit report and summary of manufacturing activity?

 

Company Y

Company Z

Operating Profit Report for Year

Per Unit

Totals

Per Unit

Totals

Sales volume, in Units

 

500,000

 

2,000,000

Sales Revenue

$85.00

$42,500,000

$25.00

$50,000,000

Cost of Goods Sold Expense (see below)

-56

-28,000,000

-18.45

-36,900,000

Gross Margin

$29.00

$14,500,000

$6.55

$13,100,000

Variable Operating Expenses

-12.5

-6,250,000

-2.5

-5,000,000

Contribution Margin

$16.50

$8,250,000

$4.05

$8,100,000

Fixed Operating Expenses

 

-5,000,000

 

-7,500,000

Operating Profit

 

$3,250,000

 

$600,000

Manufacturing Activity Summary for Year

Per Unit

Totals

Per Unit

Totals

Annual Production Capacity, in Units

 

800,000

 

2,500,000

Actual Output, in Units

 

500,000

 

2,500,000

Raw Materials

$15.00

$7,500,000

$7.50

$18,750,000

Direct Labor

20

10,000,000

2.75

6,875,000

Variable Manufacturing Overhead Costs

5

2,500,000

5

12,500,000

Total Variable Manufacturing Costs

$40.00

$20,000,000

$15.25

$38,125,000

Fixed Manufacturing Overhead Costs

16

8,000,000

3.2

8,000,000

Product Cost and Total Manufacturing Costs

$56.00

$28,000,000

$18.45

$46,125,000

Reference no: EM13534960

Questions Cloud

Find how much has the vertical height of the skater changed : A 53.6-kg skateboarder starts out with a speed of 2.49 m/s. He does 114 J of work on himself by pushing with his feet against the ground. How much has the vertical height of the skater changed
Calculate abc dividends received deduction for 2013 : ABC Company owns 40 percent of JMT Company and 95 percent of DEM Company. JMT pays a $100,000 dividend to ABC and DEM pays a $40,000 dividend to ABC in 2013. Assuming that ABC has $1,000,000 of taxable income, calculate ABC's dividends receive..
Why is mercury a convenientliquid for a barameter : State the energy conversion carried out by the chloroplast. Why is Mercury a convenientliquid for a Barameter?
Compute what is the height of the cliff : two balls A and B are thrown from the top of a vertical cliff. Ball A is thrown horizontally reaching the ground in 3.5 s. what is the height of the cliff
Summary of manufacturing activity : Do you go along with the president, or do you argue for changing the operating profit report and summary of manufacturing activity?
What ways might the innate immune responses of an artropod : How might be an arthropod such as a cockroach or beetle, protect itself from infection? in what ways might the innate immune responses of an artropod be similar to those of a plant and how might they differ?
Toledo uses the net realizable value method to allocate join : Toledo uses the net realizable value method to allocate joint costs.
Determine what is the childs acceleration : A child sits 1.75 m from the center of a rotating merry-go-round that makes one complete revolution (spin) in 2.58 seconds. What is the child's acceleration
Calculate what is the speed of the third piece : A spaceship of mass 2.30×106kg is cruising at a speed of 4.30×106m/s when the antimatter reactor fails, blowing the ship into three pieces. What is the speed of the third piece

Reviews

Write a Review

Cost Accounting Questions & Answers

  Calculate the overall effects of these transactions

Calculate the overall effects of these transactions on the store's reported income for 2014

  Traditional overhead allocation system

Describe four potential problems with a traditional overhead allocation system and describe the differences between unit-related, batch-related, and product-sustaining activities. Give one example of each type of activity.

  Kirkaid company recorded the following transactions

Kirkaid Company recorded the following transactions for the just completed month. Record the above transactions in journal entries.

  Prepare a complete statement of cash flows

Prepare journal entries for the selected transactions related to this company's stock during the current year and prepare a complete statement of cash flows for calendar-year 2011 using the indirect method

  The predetermined moh rate per machine hr

Evaluate the predetermined MOH rate per machine hr - Smith paints allocates overhead based on machine hours.

  Determine the amount of cash collected

Determine the amount of cash collected during 2012 from sales on credit 2. determine the amount of bad debts expense for 2012

  How engineers estimate that the facility will remain useful

Water Planet is considering purchasing a water park in Atlanta, Georgia, for $1,870,000. The new facility will generate annual net cash inflows of $460,000 for eight years. Engineers estimate that the facility will remain useful for eight years an..

  Determine sagaworth net cash flow from operating activities

Determine Sagaworth's net cash flow from operating activities for 2011 under the indirect method.

  Anderson manufacturing makes a single productnbsp budget

anderson manufacturing makes a single product.nbsp budget information regarding the current period is given

  Create a segmented income statement in contribution format

Traceable fixed expenses totaled $216,000 and were allocated as 70 percent to Eastern and 30 percent to Western. Common fixed expenses totaled $295,000.

  Classify the following items as investment by owner

Classify the following items as investment by owner (I), owner's drawings (D), revenues (R), or expenses (E).Then indicate whether each item increases or decreases owner's equity.

  Evaluate how the company you selected could best allocate

evaluate how the company you selected could best allocate costs to divisions plants departments contracts and or

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd