What price should prescotts managers set

Assignment Help Financial Accounting
Reference no: EM13496233

Prescott, Inc., manufactures bookcases and uses an activity-based costing system. Prescott's activity areas and related data follows:

Activity Budgeted Cost
of Activity
Allocation Base Cost Allocation
Materials handling $230,000 Number of parts $0.50
Assembly 3,200,000 Direct labor hours 16.00
Finishing 180,000 Number of finished

"Prescott produced two styles of bookcases in October: the standard bookcase and an unfinished bookcase, which has fewer parts and requires no finishing. The totals for quantities, direct materials costs, and other data follow:"

Product Total Units
Total Direct
Materials Costs
Total Direct
Labor Costs
Total Number
of Parts
Total Assembling
Direct Labor Hours
Standard bookcase 3,000 $36,000 $45,000 9,000 4,500
Unfinished bookcase 3,500 35,000 35,000 7,000 3,500

1. Compute the manufacturing product cost per unit of each type of bookcase.
"2. Suppose that pre-manufacturing activities, such as product design, were assigned to the standard bookcases at $7 each, and to the unfinished bookcases at $2 each. Similar analyses were conducted of post-manufacturing activities such as distribution, marketing, and customer service. The post-manufacturing costs were $22 per standard bookcase and $14 per unfinished bookcase. Compute the full product costs per unit."
3. Which product costs are reported in the external financial statements? Which costs are used for management decision making? Explain the difference.
4. What price should Prescott's managers set for unfinished bookcases to earn $15 per bookcase?


Reference no: EM13496233

Previous Q& A

  Evaluate the concentrations of all species in a solution

Calculate the concentrations of all species in a 0.100 M H3PO4 solution given the following Ka: 7.5 X 10^-3 for H3PO4^- 6.2 X 10^-8 for H2PO4^- and 4.8 X 10^-13 HPO4^2

  Compute how fast is dan going as his feet hit the ground

Dan is gliding on his skateboard at 3.0 m/s. He suddenly jumps backward off the skateboard, kicking the skateboard forward at 8.0 m/s. How fast is Dan going as his feet hit the ground

  What force is keeping the car in the circle

A car is moving on a flat horizontal circular track of radius 120 m. The speed of the car is constant, 15m/s. The mass of the car is 1200 kg.  What force is keeping the car in the circle

  Explain preparation of chromium complexes

Preparation of chromium complexes such as [Cr(en)3](ClO4)3, the typical starting material is CrCl3 6H2O. When combined with excess ethylenediamine in an appropriate solvent

  Determine the speed of the five-car train

Three identical train cars, coupled together, are rolling east at 1.6 m/s . A fourth car traveling east at 4.4 m/s catches up with the three and couples to make a four-car train. What is the speed of the five-car train

  Interest group theory prespective of regulation

Critically analyse and evaluate the arguments for, and against, for each of the case studies. Which arguments do you consider to be more compelling

  Calculate the predetermined overhead rate

Lu Technology, Co., manufactures CDs and DVDs for computer software and entertainment companies. Lu uses job order costing and has a perpetual inventory system.

  How far up the smooth side will the marble go

A uniform marble rolls down a symmetric bowl, starting from rest at the top of the left side. The top of each side is a distance above the bottom of the bowl. How far up the smooth side will the marble go

  Explain the reaction of crcl3 with liquid nh3

The reaction of CrCl3 with liquid NH3 to give yellow [Cr(NH3)6]Cl3 often has a low yield, since the reaction tends to stop with the production of pink [Cr(NH3)5Cl]Cl2

  Do you think that non-human animals have interests

Do you think that non-human animals have interests?


Write a Review


Similar Q& A

  Create the required general journal entry to record the

create the required general journal entry to record the subsequent transactions for the flaherty company.a. incurred

  Give journal entries necessary on september

The dividend is payable on October 12 to the stockholders of record on September 30. Give journal entries necessary on September 15, September 30, and October 12, 2010.

  What were the company annual sales and its acp

total current assets of $675,000, and cash and marketable securities of $100.000 in 2007. What were the company's annual sales and its ACP for that year?

  Questions on accounts receivables

Questions on accounts receivables and capital expenditure and When the effective interest method is used to amortize bond premium or discount and question related to trading securities

  Explain the history of corporate accounting responsibility

Read and cite at least 5 articles from the popular business and accounting press relating to CSR and discussing current events as they relate to professional ethics for accountants.

  Your ceo read a recent report on the importance of the sox

your ceo read a recent report on the importance of the sox act but he acknowledged that he does not know much about it.

  Alfred a 33 percent profits and capital partner in pizzeria

alfred a 33 percent profits and capital partner in pizzeria partnership requires help in adjusting his tax basis to

  Prepare the journal entries necessary to correct books

Prepare the journal entries necessary in 2010 to correct the books for the following items, assuming that the books have not been closed. Disregard effects of corrections on income tax.

  The current assets and current liabilities for apple

the current assets and current liabilities for apple computer inc. and dell inc. are shown as follows at the end of a

  Multiple choice questions on cvp analysis1 sharp company

multiple choice questions on cvp analysis.1. sharp company retailer plans to sell 15000 units of product x during the

  Economic ordering quantity computationcalculate the eoqels

economic ordering quantity computation.calculate the eoqels for the following two cases.raw material lrmannual demand

  Accounting records for the machine

Lee offered for sale $10,000 a machine that has been purchased for $17,500. If Whitney paid Lee $6,000 for the machine, the amount that Whitney would record in the accounting records for the machine is what?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd