ABC Company makes two types of chairs. One of the chairs is a rocking chair. The other is a straight-back chair. Both chairs are made by hand. ABC Company uses a company-wide overhead rate that is based on direct labor hours to assign overhead costs to the two products. If ABC automates the production of straight-back chairs and continues to use direct labor hours as a company-wide allocation basis, 

A modern cost allocation process that employs multiple cost drivers is:

Which of the following allocation bases for automation costs would be an improvement over direct labor hours? 

This question is worth a total of 10 points: Widget Company currently manufactures a component used in one of its products. The annual production costs for 5,000 components are as follows:      Material cost                                           $5 per unit      Labor cost                                                $4 per unit      Overhead                                                 $1 per unit      Batch-level set-up costs for the year    $5,000      Product-level product manager salary   $18,000      Allocated facility-level costs                    $12,000 An outside company has offered to supply 5,000 units of the component for $13 each.  If the company outsources the component, it will be able to rent out the idled factory space for $1,000 per month but will not terminate the product manager. Required: (NOTICE that there are four (4) questions here!) 1.  Which items are not relevant to this outsourcing decision? 2.  Identify any opportunity costs associated with this decision. 3.  (a)  Prepare a quantitative analysis that indicates whether the component should be outsourced.          (b)  In addition, recommend whether it should be outsourced or not. 4.  What qualitative factors should be considered in this decision?

For most businesses, quality means

The assignments that are due can be found in this way:

Tell me a little about the Accounting I and Accounting II courses you took, such as where did you take them, who was your instructor, did you enjoy those classes?

                                               Product 1                   Product 2                   Product 3 Direct Material Cost               $25,000                    $30,000                   $35,000 Direct Labor Cost                   $30,000                     $40,000                    $50,000 Direct Labor Hours                 1,200 hours              1,800 hours               2,000 hours Factory overhead is estimated to be $30,000 and is applied based on direct labor dollars.  This overhead cost is not traceable to any particular product. The total cost of Product 1 is:

Consider the following cost-volume-profit graph:   The line designated by the letter (A) represents which of the following?

This question is worth a total of 21 points.           SHOW COMPUTATIONS TO RECEIVE CREDIT!                      LABEL YOUR NUMBERS! Hamilton Company produces and sells a product that has variable costs of $60 per unit and a selling price of $90 per unit.  Its current sales total $202,500 per month.  Fixed manufacturing costs total $24,000 per month and fixed selling and administrative costs total $30,000 per month.  The company is considering a proposal that will increase the selling price by 10%, decrease the fixed manufacturing costs by 10%, and decrease the fixed selling and administrative costs by $1,600.  Required:             1.)  Compute the company’s break-even point in units before the proposal.             2.)  Compute the company’s current net income before the proposal.             3.)  Compute the margin of safety in dollars using the current information (without the proposal).             4.)  Compute the break-even point in units assuming the proposal is accepted.             5.)  Compute the company’s net income assuming the proposal is accepted and sales total 3,000 units.             6.)  Should the proposal be accepted? Why or Why not?