Homework Help is Here – Start Your Trial Now!
Business
Accounting
Direct Cost per Unit Direct materials Direct labor Category Unit level Batch level Estimated Cost $ 24,000 Product level 47,000 87,500 270,000 Model 2M $ 20.50 29.00 Model DS $ 10.50 13.00 Cost Driver Number of units Number of setups Number of TV commercials Number of machine hours Amount of Cost Driver ZM: 2,450 units; DS: 9,550 units ZM: 25 setups; DS: 25 setups ZM: 14; DS: 11 ZM: 500 hours; DS: 1,000 hours Facility level Total $ 428,500 ch's facility has the capacity to operate 4,500 machine hours per month.

Direct Cost per Unit Direct materials Direct labor Category Unit level Batch level Estimated Cost $ 24,000 Product level 47,000 87,500 270,000 Model 2M $ 20.50 29.00 Model DS $ 10.50 13.00 Cost Driver Number of units Number of setups Number of TV commercials Number of machine hours Amount of Cost Driver ZM: 2,450 units; DS: 9,550 units ZM: 25 setups; DS: 25 setups ZM: 14; DS: 11 ZM: 500 hours; DS: 1,000 hours Facility level Total $ 428,500 ch's facility has the capacity to operate 4,500 machine hours per month.

Managerial Accounting: The Cornerstone of Business Decision-Making
Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Chapter13: Emerging Topics In Managerial Accounting
Section: Chapter Questions
Problem 32BEB: During the week of August 21, Parley Manufacturing produced and shipped 4,000 units of its machine...
See similar textbooks
icon
Related questions
Question
86 Finch Cameras, Incorporated manufactures two models of cameras. Model ZM has a zoom lens; Model DS has a fixed lens. Finch uses an activity-based costing system. The following are the relevant cost data for the previous month: Direct Cost per Unit Direct materials Direct labor Category Unit level Batch level Product level Facility level Total Estimated Cost $ 24,000 47,000 87,500 270,000 $ 428,500 Model 2M Model DS $ 10.50 13.00 $ 20.50 29.00 Cost Driver Number of units Number of setups Number of TV commercials Number of machine hours Amount of Cost Driver ZM: 2,450 units; DS: 9,550 units ZM: 25 setups; DS: 25 setups ZM: 14; DS: 11 ZM: 500 hours; DS: 1,000 hours Finch's facility has the capacity to operate 4,500 machine hours per month. Required a. Compute the cost per unit for each product. b. The current market price for products comparable to Model ZM is $129 and for DS is $80. If Finch sold all of its products at the market prices, what was its profit or loss for the previous month? c. A market expert believes that Finch can sell as many cameras as it can produce by pricing Model ZM at $124 and Model DS at $45. Finch would like to use those estimates as its target prices and have a profit margin of 30 percent of target prices. What is the target cost for each product? Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required A Required B Required C The current market price for products comparable to Model ZM is $129 and for DS is $80. If Finch sold all of its products at the market prices, what was its profit or loss for the previous month? (Round intermediate calculations to 2 decimal places. Loss amounts should be indicated by a minus sign.) Model ZM Model DS Profit Profit Amount 11 29
Transcribed Image Text:86 Finch Cameras, Incorporated manufactures two models of cameras. Model ZM has a zoom lens; Model DS has a fixed lens. Finch uses an activity-based costing system. The following are the relevant cost data for the previous month: Direct Cost per Unit Direct materials Direct labor Category Unit level Batch level Product level Facility level Total Estimated Cost $ 24,000 47,000 87,500 270,000 $ 428,500 Model 2M Model DS $ 10.50 13.00 $ 20.50 29.00 Cost Driver Number of units Number of setups Number of TV commercials Number of machine hours Amount of Cost Driver ZM: 2,450 units; DS: 9,550 units ZM: 25 setups; DS: 25 setups ZM: 14; DS: 11 ZM: 500 hours; DS: 1,000 hours Finch's facility has the capacity to operate 4,500 machine hours per month. Required a. Compute the cost per unit for each product. b. The current market price for products comparable to Model ZM is $129 and for DS is $80. If Finch sold all of its products at the market prices, what was its profit or loss for the previous month? c. A market expert believes that Finch can sell as many cameras as it can produce by pricing Model ZM at $124 and Model DS at $45. Finch would like to use those estimates as its target prices and have a profit margin of 30 percent of target prices. What is the target cost for each product? Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required A Required B Required C The current market price for products comparable to Model ZM is $129 and for DS is $80. If Finch sold all of its products at the market prices, what was its profit or loss for the previous month? (Round intermediate calculations to 2 decimal places. Loss amounts should be indicated by a minus sign.) Model ZM Model DS Profit Profit Amount 11 29
Expert Solution
steps

Step by step

Solved in 5 steps

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Knowledge Booster
Accounting for Merchandise Inventory
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
Managerial Accounting: The Cornerstone of Busines…
Managerial Accounting: The Cornerstone of Busines…
Accounting
ISBN:
9781337115773
Author:
Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:
Cengage Learning
Principles of Accounting Volume 2
Principles of Accounting Volume 2
Accounting
ISBN:
9781947172609
Author:
OpenStax
Publisher:
OpenStax College
Cornerstones of Cost Management (Cornerstones Ser…
Cornerstones of Cost Management (Cornerstones Ser…
Accounting
ISBN:
9781305970663
Author:
Don R. Hansen, Maryanne M. Mowen
Publisher:
Cengage Learning
Managerial Accounting
Managerial Accounting
Accounting
ISBN:
9781337912020
Author:
Carl Warren, Ph.d. Cma William B. Tayler
Publisher:
South-Western College Pub
Financial And Managerial Accounting
Financial And Managerial Accounting
Accounting
ISBN:
9781337902663
Author:
WARREN, Carl S.
Publisher:
Cengage Learning,
Excel Applications for Accounting Principles
Excel Applications for Accounting Principles
Accounting
ISBN:
9781111581565
Author:
Gaylord N. Smith
Publisher:
Cengage Learning
SEE MORE TEXTBOOKS