Suppose you are a manager in a manufacturing company your

Reference no: EM13590529

Suppose you are a manager in a manufacturing company. Your accountant has just presented you with a very detailed cost analysis for a decision whether to outsource or make a component of a product. You have to use this analysis in a meeting with other managers. Since the analysis is shown in totals and your colleagues prefer simple reports and unit costs, you divide the bottom-line amounts by the total units to be made or bought (outsourced) and present just these in a simple report. Your colleagues are pleased that your report is so easy to understand and simple to use. Then they begin to predict the total cost differences for several other possible numbers of units to be made or outsourced by simply multiplying the unit costs by the volume to be outsourced. Why should you feel uncomfortable?

Reference no: EM13590529

Questions Cloud

A eagle can fly 35 kilometers per hour faster than a : an eagle can fly 35 kilometers per hour faster than a hummingbird. in the same amount of time an eagle can fly 8.5

Ramos company has a 90-day note that carries an annual : ramos company has a 90-day note that carries an annual interest rate of 8. if the amount of the total interest on the

What are the three most important differences between the : what are the three most important differences between the accounting profession and accounting standards in the

Leary corporation had net credit sales during the year of : leary corporation had net credit sales during the year of 900000 and cost of goods sold of 540000. the balance in

Suppose you are a manager in a manufacturing company your : suppose you are a manager in a manufacturing company. your accountant has just presented you with a very detailed cost

Using the allowance method the uncollectible accounts for : using the allowance method the uncollectible accounts for the year are estimated to be 40000. if the balance for the

If allowance for doubtful accounts has a credit balance of : the ledger of the ramirez company at the end of the current year shows accounts receivable of 200000.instructions if

Bbb corporation use a standard cost system in which it : bbb corporation use a standard cost system in which it applies manufacturing overhead to products on the basis of

On february 2 2013 alexandra purchases a personal computer : on february 2 2013 alexandra purchases a personal computer for her home. the computer cost 3000. alexandra uses the

User Account

All Pages