Calculate the nonvalue-added cost per unit, Cost Accounting

Question

Roseville, Ltd., sells one of its products for $500 each. Sales volume averages 1,000 units per year. Recently, its main competitor priced their competing product at 10 percent below Roseville's price. Roseville expects its sales to drop dramatically unless it matches the competitor's price. Despite the anticipated price reduction, Roseville would like to maintain its current profit per unit.

Information regarding the inputs required to produce 1,000 units of product is as follows:

                                    SQ

                        AQ

          Actual Cost

Materials (kilograms)

7,800

8,000

$160,000

Labour (hours)

600

720

108,000

Setups (hours)

-0-

600

34,000

Material handling (moves)

-0-

300

58,000

Warranties (number repaired)

-0-

200

60,000







(A) Calculate the target cost for maintaining current market share and profitability.

(B) Calculate the nonvalue-added cost per unit.

(C) If nonvalue-added costs can be reduced to zero, can the target cost be achieved? Explain your answer.

Posted Date: 2/18/2013 4:58:17 AM | Location : United States







Related Discussions:- Calculate the nonvalue-added cost per unit, Assignment Help, Ask Question on Calculate the nonvalue-added cost per unit, Get Answer, Expert's Help, Calculate the nonvalue-added cost per unit Discussions

Write discussion on Calculate the nonvalue-added cost per unit
Your posts are moderated
Related Questions
It takes about two to three years to fully execute FCA and get all employees comfortable with it. Even then, the process will still develop. In Greensboro, North Carolina, it took

Usefulness of Variance Analysis Carefully note that while prices are being charged to production, it can be done at the actual or standard price. For purposes of making varian

Determine Inventory Costs Mary Cosmetics sells specialty lipstick for a retail price of $12.25 each. Mary purchases each tube for $5.00 and pays the following additional amounts: $

This question tested the accounting of monetary instruments, especially an asset held at reasonable value through loss or profit. The preparation of the journal for subsequent and


ASSUMPTIONS OF BREAK EVEN ANALYSIS 1. Fixed costs for all time remain constant. 2. All costs are divided into fixed and variable costs. 3. Selling price will not alter de

what is irrelevant cost and give example

PrivateJets (PJ) is considering expanding its operations in the corporate travel market. Currently, PJ has a capital structure with a 25% debt-equity ratio. Their levered equity

DIFFERENTIAL COSTING Marginal costing is often confused with differential costing. The word 'DIFFERENTIAL COSTING' means 'a technique used in the preparation of adhoc informati

Variance Analysis and Standard Costing Standard costing is defined with CIMA like a technique that uses standards for revenues and costs for the purpose of control via varianc