Exercise 4-8 Computing Predetermined Overhead Rates and Job Costs [LO4-1, LO4-2, LO4-3, LO4-4]

Kody Corporation uses a job-order costing system with a plantwide overhead rate based on machine-hours. At the beginning of the year, the company made the following estimates:

Machine-hours required to support estimated production

154,000

Fixed manufacturing overhead cost

$

659,000

Variable manufacturing overhead cost per machine-hour

$

4.80

Required:

1. Compute the predetermined overhead rate. (Do not round intermediate calculations. Round your answer to 2 decimal places.)
   Predetermined overhead rate __ Per MH
2. During the year Job 500 was started and completed. The following information was available with respect to this job:

Direct materials requisitioned

$

340

Direct labor cost

$

260

Machine-hours used

40

Compute the total manufacturing cost assigned to Job 500. (Round your intermediate calculations and final answer to 2 decimal places.)

    Total manufacturing cost______  

3-a. During the year the company worked a total of 145,100 machine-hours on all jobs and incurred actual manufacturing overhead costs of $1,319,508. What is the amount of underapplied or overapplied overhead for the year? (Round your intermediate calculations to 2 decimal places.)

    Manufacturing overhead cost______ by_________  

3-b. If this amount were closed out entirely to Cost of Goods Sold, would net operating income increase or decrease?

Increase

Decrease

2.

Problem 2-25 Cost Classification and Cost Behavior [LO2-1, LO2-2, LO2-3, LO2-4]

The Dorilane Company specializes in producing a set of wood patio furniture consisting of a table and four chairs. The set enjoys great popularity, and the company has ample orders to keep production going at its full capacity of 4,100 sets per year. Annual cost data at full capacity follow:

Direct labor

$

95,000

Advertising

$

99,000

Factory supervision

$

72,000

Property taxes, factory building

$

17,000

Sales commissions

$

61,000

Insurance, factory

$

7,000

Depreciation, administrative office equipment

$

2,000

Lease cost, factory equipment

$

17,000

Indirect materials, factory

$

18,000

Depreciation, factory building

$

107,000

Administrative office supplies (billing)

$

4,000

Administrative office salaries

$

105,000

Direct materials used (wood, bolts, etc.)

$

434,000

Utilities, factory

$

49,000

Required:

1. Enter the dollar amount of each cost item under the appropriate headings. Note that each cost item is classified in two ways: first, as variable or fixed with respect to the number of units produced and sold; and second, as a selling and administrative cost or a product cost. (If the item is a product cost, it should also be classified as either direct or indirect.) (If your answer is zero, leave the cell blank.)
2. Compute the average product cost of one patio set. (Round your answer to nearest whole dollar.)
   average product cost_____perset
3. Assume that production drops to only 1,000 sets annually. Would you expect the average product cost per set to increase, decrease, or remain unchanged?

Increase

Decrease

Remain unchanged

3.

Problem 3-22 Basics of CVP Analysis; Cost Structure [LO 3-1, LO 3-3, LO 3-4, LO 3-5, LO 3-6]

Due to erratic sales of its sole product—a high-capacity battery for laptop computers—PEM, Inc., has been experiencing difficulty for some time. The company’s contribution format income statement for the most recent month is given below:

Sales (13,000 units × $40 per unit)

$

520,000

Variable expenses

260,000

Contribution margin

260,000

Fixed expenses

290,000

Net operating loss

$

(30,000)

Required:

1. Compute the company’s CM ratio and its break-even point in both unit sales and dollar sales.

Cm ratio _

Break even points in units________ ,__%

Break even point in dollars______,__%

1. The president believes that a $6,300 increase in the monthly advertising budget, combined with an intensified effort by the sales staff, will result in an $80,000 increase in monthly sales. If the president is right, what will be the effect on the company’s monthly net operating income or loss? (Use the incremental approach in preparing your answer.)

_by____

1. Refer to the original data. The sales manager is convinced that a 10% reduction in the selling price, combined with an increase of $30,000 in the monthly advertising budget, will double unit sales. What will the new contribution format income statement look like if these changes are adopted?

Contribution income statement

_ –_

_–

_–

–_

–__

1. Refer to the original data. The Marketing Department thinks that a fancy new package for the laptop computer battery would help sales. The new package would increase packaging costs by $0.70 cents per unit. Assuming no other changes, how many units would have to be sold each month to earn a profit of $4,100? (Do not round intermediate calculations and round your final answer to the nearest whole number.)

Sales units_______

1. Refer to the original data. By automating, the company could reduce variable expenses in half. However, fixed expenses would increase by $57,000 each month.

a. Compute the new CM ratio and the new break-even point in both unit sales and dollar sales. (Use the CM ratio to calculate your break-even point in dollars. Round your final answers to the nearest whole number.)

Cm ratio___________

Break even points in units______ . _%

Break even points in dollars_______ , _%

b. Assume that the company expects to sell 20,900 units next month. Prepare two contribution format income statements, one assuming that operations are not automated and one assuming that they are.

PEM INC

Contribution income statment

Not automated auto mated

Total per unit % total perunit %

---

——— _ __

---

——— ———- _ _ _

——– ———– _ __

· Administrative expenses

· Advertising

· Beginning merchandise inventory

· Commissions

c. Would you recommend that the company automate its operations?

Yes

No

4.

Exercise 2-10 Cost Behavior; Contribution Format Income Statement [LO2-4, LO2-6]

Harris Company manufactures and sells a single product.

Required:

1. A partially completed schedule of the company’s total and per unit costs over the relevant range of 70,000 to 110,000 units produced and sold annually is given below: Complete the schedule of the company’s total and unit costs. Round the variable cost and fixed cost to 2 decimal places.)

Units produced and sold

70,000 90,000, 110,0000

Total Cost

Variable costs $ 147,000 _

Fixed Costs 470,00 _ __

Total Costs $617,00

Cost per unit

Variable cost _

Fixed cost _

Total cost per unit

1. Assume that the company produces and sells 100,000 units during the year at a selling price of $8.32 per unit. Prepare a contribution format income statement for the year. (Do not round intermediate calculations.)

Harris Company

Contribution format statement

---

---

---

---

---

· Administrative expenses

· Beginning merchandise inventory

· Cost of goods sold

· Direct labor

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APPLICATION OF ADULT LEARNING THEORY TASK

INSTRUCTIONS AND GRADING CRITERIA

GENERAL INSTRUCTIONS

In this assignment, students will write a four—five page paper that describes one adult learning theory that is not covered in the textbook (e.g. Transformational Learning, Experiential Learning, Constructivist Learning, etc.) how that theory incorporates or aligns with the principles/assumptions of adult learning as described in Chapter 2 of the textbook and in our class discussion, how the theory & principles are practically applied in the classroom and workplace, and the ways the student has personally experienced them in his/her own education, work life, or any other training setting. The Adult Learning Theory and principles covered should include adult learning in general as well as college learning (PLEASE NOTE: learning theories and principles DO NOT include general laws of learning). A minimum of five sources is required for this assignment (one of these can be the textbook).

SPECIFIC GUIDELINES

Papers must include ALL of the following:

A clear title for the paper (not “Application of Learning Theory Essay”);

An introduction that includes all of the following:

overview of the paper

clear thesis statement

preview of the main points

an attention getter/interesting opening would be great as well, though not required;

The body of the paper should include sections that cover each of the following:

Overview/Explanation of the Adult Learning Theory: This section should include a review of your research into the theory as well as explanation and examples so the reader gains a general understanding of the theory. In addition, this section should include specific ways that the theory incorporates or aligns with the Adult Learning Principles/assumptions as discussed in Chapter 2.

Practical Application: In this section, explain and describe specific examples of how the adult learning theory is, or can be, practically applied in real learning situations (college classroom, business settings, as well as online). Please be sure to include how they might be applied in a COMM80 workshop.

Personal Experience: Comment on the ways that the learning theory & principles affected your own education and learning experience in the classroom, at work, as well as any other learning environment. Be sure to provide specific examples.

A complete conclusion that does all of the following:

summarizes key ideas

reiterates the thesis or central theme of the paper

a thoughtful closing statement

In-text citations and a reference list in APA format for all sources cited in the paper.

Finally, essays should be well organized (e.g. ideas flow logically; paragraphs develop one key idea; clear transitions between paragraphs and key sections of the paper.

FORMAT: Essays should be typed in 10 – 12 pt font (nothing larger than 12 pt), double-spaced (except the heading, which should be single-spaced in the upper right-hand corner), one-inch margins, and grammatically correct. Please include your name, date, and course section single spaced in the upper right-hand corner, and a clear, thoughtful title for the paper centered over the text of the paper.

PLEASE NOTE: in order to conserve resources, please DO NOT include a cover page.

SUBMISSION FORMAT: Please upload a copy of your paper to Canvas AND submit a hard copy in class on Monday.

This paper is worth up to 75 points.

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7.4 Assume That Valley Forge Hospital Has Only The Following Three Payer Groups: Number Of Average Revenue Variable Cost Payer Admissions Per Admissions

                             Number of                  Average Revenue              Variable Cost

Payer Admissions per Admissions per Admissions

Penn Care $1,000 $5,000 $3,000

Medicare 4,000 4,500 4,000

Commercial 8,000 7,000 2,500

C. What overall net income would be produced if the admission rate of the capitated group were reduced from the commercial level by 10 percent?

D. Assuming that the utilization reduction also occurs, what overall net income would be produced if the variable cost per admission for the capitated group were lowered to $2,200

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Performance Measures

In healthcare, the terms “balanced scorecard” and a “dashboard” are used to describe performance measurement tools that are broad in scope but summarized in a few key indicators. In this assignment, you will create a specific dashboard for an operating Week of a healthcare organization.

Tasks:

Select and describe a specific division of a larger healthcare organization, such as an emergency department, a surgical service, or a physician practice.

Locate at least three recent (within the past three years) journal articles from professional, peer-reviewed journals that discuss dashboard, balanced scorecard, and performance measurement in your chosen healthcare division.

Write a review of each article and include complete citations.

Based on the information learned, create and justify the need for four categories of measurement, such as customer satisfaction or financial performance. For each of these four categories, create three specific performance measures. For each measure, describe how it is calculated and/or where the data can be found.

Explain how the performance measures may change if the analysis is for the organization as a whole rather than a division of the organization.

Resources:

Gordon, J., & Richardson, E. (2012). Continuous improvement using balanced scorecard in healthcare. American Journal of Health Sciences, 3(3), 185-188. doi:http://dx.doi.org.southuniversity.libproxy.edmc.edu/10.19030/ajhs.v3i3.7136

Perkins, M., Grey, A., & Remmers, H. (2014). What do we really mean by “balanced scorecard”? International Journal of Productivity and Performance Management, 63(2), 148-169. Retrieved from https://search-proquest-com.southuniversity.libproxy.edmc.edu/docview/1667910740?accountid=87314

Submission Details:

To support your work, use your course and textbook readings and also use the South University Online Library. As in all assignments, cite your sources in your work and provide references for the citations in APA format.

Your assignment should be addressed in a 2- to 3-page document.

Name your document SU_MHC6303_W2P_LastName_FirstInitial.doc and submit to the Submissions Area by the due date assigned.

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