Jack and Jill Manufacturing Inc. began the year with the following.
Transferred to finished goods
Materials added at the beginning of the process.
Required: Calculate the equivalent units for the following.
a. Materials costs under the weighted average process cost method
b. Conversion costs under the weighted average process cost method
c. Materials costs under the FIFO process cost method
d. Conversion costs under the FIFO process cost method
Overhead costs have been divided into three cost pools that use the following activity drivers.
# of Setups
Cost per Pool
a. What is the allocation rate for Product Z per setup using activity-based costing?
b. What is the allocation rate for Product Z per machine hours using activity-based costing?
c. What is the allocation rate for Product Z per packing order using activity-based costing?
Sales volume averages 10,000 units per year.
Recently, its main competitor reduced the price of its product to $68.
Maximum expects sales to drop dramatically unless it matches the competitor's price.
In addition, the current profit per unit must be maintained.
Information about the product (for production of 10,000) is as follows.
Material handling (moves)
Warranties (number repaired)
a. Calculate the target cost for maintaining current market share and profitability.
b. Calculate the non-value-added cost per unit.
c. If non-value-added costs can be reduced to zero, can the target cost be achieved?
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