Question: A number of terms are listed below: /
A number of terms are listed below: 
Required: Select the terms from the above list to complete the following sentences. Supply-chain strategy decisions determine __________________ activities. Managing inventory involves the identification of three relevant costs: ________________, ______________, and ______________. One strategy of _____________________ will match to a production decision of _________________ or ______________________ production. This JIT purchasing strategy will minimize _______________ of inventory and reduce or eliminate both __________ and __________ but may increase ________. The goal of the management team is to minimize the overall combination of costs associated with inventory management. Any inventory management model requires careful analysis to identify the ____________, the _______________________, and the __________. The management team requires high- quality information in a database of the type found in ___________________________ systems. ERP systems are demand pull systems. Implementing a good demand-pull system requires a highly coordinated information flow that supports lean production. Lean production (JIT) can eliminate inventory and therefore ________________ is appropriate. With no WIP or materials inventories, the need for sequential or ___________________ of costs of production through the inventories is no longer necessary. Instead _____________ are identified such as materials purchase and completion of unspoiled finished goods. Costs transfer at only these two trigger points from the Direct Materials to the Finished Goods inventory.
Transcribed Image Text:
backflush costing economic order quantity inventory management just-in-time (JIT) purchasing ordering costs reorder point stockout costs carrying costs enterprise resource planning (ERP) just-in-time (JIT) production lean production purchasing costs shrinkage costs synchronous tracking safety stock trigger points
> Jo Nathan Publishing Company specializes in printing specialty textbooks for a small but profitable college market. Due to the high setup costs for each batch printed, Jo Nathan holds the book requests until demand for a book is approximately 500. At tha
> Amir’s Fleet Feet Inc. produces dance shoes for stores all over the world. While the pairs of shoes are boxed individually, they are crated and shipped in batches. The shipping department records both variable and fixed overhead costs.
> Heather’s Horse Spa (HHS) is an establishment that boards, trains, and pampers horses while their owners are on vacation. Heather sells her service as an “enchanting vacation experience for your horse while you vacation elsewhere.” Horse feed, shampoos,
> The Art Supply Company produces various types of paints. Actual direct manufacturing labour-hours (DMLH) in the factory that produces paint have been higher than budgeted hours for the last few months and the owner, Sarah B. Jones, is concerned about the
> Nolton Products uses standard costing. It allocates manufacturing overhead (both variable and fixed) to products on the basis of standard direct manufacturing labour-hours (DMLH). Nolton develops its manufacturing overhead rate from the current annual bu
> Consider each of the following situations—cases A, B, and C—independently. Data refer to operations for April 2015. For each situation, assume standard costing. Also assume the use of a flexible budget for control of v
> French Bread Company also allocates fixed manufacturing overhead to products on the basis of standard direct manufacturing labour-hours. For 2015, fixed manufacturing overhead was budgeted at $4.00 per direct manufacturing labour hour. Actual fixed manuf
> Fresh Inc. is a manufacturer of vacuums and uses standard costing. Manufacturing overhead (both variable and fixed) is allocated to products on the basis of budgeted machine-hours. In 2015, budgeted fixed manufacturing overhead cost was $18,000,000. Budg
> Refer to Problem 8-29. Required: 1.Prepare journal entries for variable and fixed manufacturing overhead (you will need to calculate the various variances to accomplish this). 2.Overhead variances are written off to the Cost of Goods Sold (COGS) account
> Magic Dice manufactures premium food processors. The following is some manufacturing overhead data for Magic Dice for the year ended December 31, 2015. Required: Calculate the following quantities (you should be able to do so in the prescribed order):
> Byrd Company is a manufacturer of appliances for both residential and commercial use. The company’s accounting and financial reporting system is primarily designed to meet external reporting requirements in accordance with generally acc
> 1. I f ELF sells all 220,000 bulbs produced, what would be the effect on operating income of using each type of capacity as a basis for calculating manufacturing cost per unit? 2. Compare the results of operating income at different capacity levels when
> Earth Light First (ELF), a producer of energy-efficient light bulbs, expects that demand will increase markedly over the next decade. Due to the high fixed costs involved in the business, ELF has decided to evaluate its financial performance using absorp
> The 24-Hour Mart operates a chain of supermarkets. Its best-selling soft drink is Fruitslice. Demand ( D ) in April for Fruitslice at its Regina supermarket is estimated to be 7,200 cases (24 cans in each case). In March, the Regina supermarket estimated
> ShiraHonig, the chief financial officer of Silicon Valley Computer (SVC), is an enthusiastic advocate of JIT production. The SVC keyboard division that produces keyboards for personal computers has made dramatic improvements in its operations by a highly
> Manufacturing companies participating in a supply chain initiative linking manufacturers and retailers recently made the following comments on the benefits of the initiative: ■ “Receiving better information has allowed us to forecast and reduce inventory
> The Award Plus Company manufactures medals for winners of athletic events and other contests. Its manufacturing plant has the capacity to produce 10,000 medals each month. Current production and sales are 7,500 medals per month. The company normally char
> French Bread Company has two direct-cost categories: direct materials and direct manufacturing labour. Variable manufacturing overhead is allocated to products on the basis of standard direct manufacturing labour-hours (DMLH). Baguettes are baked in batc
> Xylon Processing Limited is a chemical manufacturer. Two chemicals, Aardyn and Gargaton, are produced from the common chemical xylon. The joint process requires 15,000 litres of xylon to be processed at a cost of $21,500 (including the cost of the chemic
> The Mayfield Corporation manufactures filing cabinets in two operations: machining and finishing. It provides the following information: Required: 1. Mayfield is considering using some modern jigs and tools in the finishing operation that would increas
> Taylor Furniture produces and sells specialty mattresses. Production is a machine-intensive process. Taylor’s variable costs are direct material costs, variable machining costs, and sales commissions. Marion Taylor, the owner, is planni
> The Auto Wash Company has just today paid for and installed a special machine for polishing cars at one of its several outlets. It is the first day of the company’s fiscal year. The machine costs $20,000. Its annual cash operating costs total $15,000. Th
> Sanchez Corporation runs two convenience stores, one in Vancouver and one in Surrey. Operating income for each store in 2015 is as follows: The equipment has a zero disposal value. In a senior management meeting, Maria Lopez, the management accountant
> An employee in the accounting department of a certain business was moving a personal computer from one room to another. As he came alongside an open stairway, he slipped and let the computer get away from him. It went careening down the stairs with a gre
> 1. Ewing Computers makes 5,000 units of a circuit board, CB76, at a cost of $230 each. Variable cost per unit is $180 and fixed cost per unit is $50. HT Electronics offers to supply 5,000 units of CB76 for $210. If Ewing buys from HT it will be able to s
> Answer the following questions. 1. A company has an inventory of 1,000 assorted parts for a line of missiles that has been discontinued. The inventory cost is $88,000. The parts can be either (a) remachined at total additional costs of $33,000 and then s
> Jill Goldstein has been collecting data over the last year in an effort to understand the cost drivers of distribution costs at Waterloo Corporation, a manufacturer of brass door handles. Distribution costs include the costs of organizing different shipm
> Dave Ladouceur owns a catering company that prepares banquets and parties for both individual and business functions throughout the year. His business is seasonal, with a heavy schedule during the summer months and the year-end holidays and a light sched
> Young Clothing allocates fixed manufacturing overhead to each suit using budgeted direct manufacturing labour-hours (DMLH) per suit. Data pertaining to fixed manufacturing overhead costs for June 2015 are $62,400 budgeted and $63,916 actual. Required: 1
> Garvin Corporation manufactures a children’s bicycle, model CT8. Garvin currently manufactures the bicycle frame. During 2016, Garvin made 30,000 frames at a total cost of $900,000. Ryan Corporation has offered to supply as many frames as Garvin wants at
> Sandy Smith, managing director of the Calgary Consulting Group, is examining how overhead costs behave with changes in monthly professional labour-hours billed to clients. Assume the following historical data: Total Overhead Costs…………..Professional Labo
> Gower Inc., a manufacturer of plastic products, reports the following manufacturing costs and account analysis classification for the year ended December 31, 2016 Gower Inc., produced 75,000 units of product in 2016. Gower’s managemen
> Lorenzo operates a brushless car wash. Incoming cars are put on an automatic, continuously moving conveyor belt. Cars are washed as the conveyor belt carries the car from the start station to the finish station. After the car moves off the conveyor belt,
> A number of terms are listed below: Required: Select the terms from the above list to complete the following sentences. There are several methods of quantitative analysis that a management team can use to predict the value of a single overhead cost p
> Rehe Company sells its razors at $3 per unit. The company uses a first-in, first-out actual costing system. A fixed manufacturing cost rate is computed at the end of each year by dividing the actual fixed manufacturing costs by the actual production unit
> Osawa Inc. planned and actually manufactured 200,000 units of its single product in 2015, its first year of operation. Variable manufacturing cost was $20 per unit produced. Variable operating (non-manufacturing) cost was $10 per unit sold. Planned and a
> The variable manufacturing costs per unit of BigScreen Corporation are: Required: 1. Prepare operating statements of comprehensive income for BigScreen Corporation in January, February, and March of 2015 under throughput costing. 2. Contrast the result
> BigScreen Corporation manufactures and sells 50-inch television sets and uses standard costing. Actual data relating to January, February, and March of 2015 are: Required: 1. Present statements of comprehensive income for BigScreen Corporation in Janua
> Assume the same facts as in Exercise 19-24, except now Road Warrior uses only two trigger points, the completion of good finished units of product and the sale of finished goods. Any under- or overallocated conversion costs are written off monthly to Cos
> Young Clothing is a manufacturer of designer suits. The cost of each suit is the sum of three variable costs (direct materials costs, direct manufacturing labour costs, and manufacturing overhead costs) and one fixed-cost category (manufacturing overhead
> Assume the same facts as in Exercise 19-23, except that Road Warrior now uses a backflush costing system with the following two trigger points: ■ Purchase of direct materials. ■ Sale of finished goods. The Inventory Control account will include direct ma
> Road Warrior Corporation assembles handheld computers that have scaled-down capabilities of laptop computers. Each handheld computer takes 6 hours to assemble. Road Warrior uses a JIT production system and a backflush costing system with three trigger po
> The Champion Hardware Company manufactures specialty brass door handles at its Kitchener plant. Champion is considering implementing a JIT production system. The following are the estimated costs and benefits of JIT production: a. Annual additional tooli
> Devin Sports Cars (DSC) has implemented a balanced scorecard to measure and support its just-in-time production system. In the learning and growth category, DSC measures the percentage of employees who are cross-trained to perform a wide variety of produ
> Morgan Company’s annual demand for Model X253 is 10,000 units. Morgan is unsure about the relevant carrying cost per unit per year and the relevant ordering cost per purchase order. This table presents six possible combinations of carry
> Lakeland Company, which produces lawn mowers, purchases 18,000 units of a rotor blade part each year at a cost of $60 per unit. Lakeland requires a 15% annual rate of return on investment. In addition, the relevant carrying cost (for insurance, materials
> The Cloth Centre sells fabrics to a wide range of industrial and consumer users. One of the products it carries is denim cloth, used in the manufacture of jeans and carrying bags. The supplier for the denim cloth pays all incoming freight. No incoming in
> Athletic Textiles (AT) manufactures the soccer jerseys that Fan Base (FB) sells to its customers. AT has recently installed computer software that enables its customers to conduct “one-stop” purchasing using state-of-the-art website technology. FB’s orde
> Fan Base (FB) operates a megastore featuring sports merchandise. It uses an EOQ decision model to make inventory decisions. It is now considering inventory decisions for its soccer jerseys product line. This is a highly popular item. Data for 2015 are:
> A number of terms are listed below: Agility………………………………………………………..………………..value-added cost Capacity…………………………………………………………………………….capacity cost non-value-added cost…………………………..……..denominator-level variance fixed overhead rate variance……………………...producti
> Mendola Corp. has an extensive job-costing facility that uses a variety of metals. Consider each requirement independently. Required: 1. Job 372 uses a particular metal alloy that is not used for any other job. Assume that scrap is material in amount an
> Bright Goods assembles washing machines at its Cambridge plant. In February 2015, 60 tumbler units that cost $44 each from a new supplier were defective and had to be disposed of at zero disposal price. That new supplier is now bankrupt. Bright Goods was
> Bamber Kitchens produces a variety of items in accordance with special job orders from hospitals, plant cafeterias, and university dormitories. An order for 2,500 cases of mixed vegetables costs $6 per case: direct materials, $3; direct manufacturing lab
> Refer to the information in Exercise 18-23. Suppose Chipcity determines standard costs of $200 per equivalent unit for direct materials and $75 per equivalent unit for conversion costs for both beginning work-in-process and work done in the current perio
> Refer to the information in Exercise 18-24. Required: Do Exercise 18-24 using the FIFO method of process costing. Data from Exercise 18-24: Chipcity Inc. is a fast-growing manufacturer of computer chips. Direct materials are added at the start of the
> Chipcity Inc. is a fast-growing manufacturer of computer chips. Direct materials are added at the start of the production process. Conversion costs are added evenly during the process. Some units of this product are spoiled as a result of defects not det
> Arokia Electronics manufactures cell phone models in its Saskatoon plant. Suppose the company provides you with the following information regarding operations for September 2015: Total cell phones manufactured …………………………..10,000 Phones rejected as spoil
> Aaron Inc. is a manufacturer of vents for water heaters. The company uses a process-costing system to account for its work-in-process inventories. When Job 512 was being processed in the machining department, a piece of sheet metal was off-centre in the
> Millstream Company makes wooden toys in its forming department, and it uses the weighted-average method of process costing. All direct materials are added at the beginning of the process, and conversion costs are added evenly during the process. Spoiled
> For the data in Exercise 18-19, use the FIFO method to summarize total costs to account for, calculate the cost per equivalent unit for direct materials and conversion costs, and assign total costs to units completed and transferred out (including normal
> A number of terms are listed below: Required: Select the terms from the above list to complete the following sentences. A full absorption cost refers to all manufacturing costs including all MOH, whereas ___________________ refers to all period or non-
> Refer to the information in Exercise 18-17. Suppose Grey Manufacturing Company uses the FIFO method of process costing instead of the weighted-average method. Required: Compute equivalent units for direct materials and conversion costs. Show physical un
> For the data in Exercise 18-17, summarize total costs to account for, calculate the cost per equivalent unit for direct materials and conversion costs, and assign total costs to units completed and transferred out (including normal spoilage), to abnormal
> Consider the following data for November 2015 from Grey Manufacturing Company, which makes silk pennants and uses a process costing system. All direct materials are added at the beginning of the process, and conversion costs are added evenly during the p
> The following data, in physical units, describe a grinding process for January: Work-in-process, beginning …………………………………..19,000 Started during current period ……………………………..150,000 To account for ……………………………………………………..169,000 Spoiled units …………………………………
> A number of terms are listed below: abnormal spoilage ………………………….inspection point normal spoilage …………………………………………..rework scrap Required: Select the terms from the above list to complete the following sentences. There is no perfect machine,
> Bucky’s Boxes makes boxes for moving. It sells its boxes to major national moving companies. Because of the simple nature of the production process, Bucky’s uses standard costing. The following information for July 201
> For the data in Exercise 17-26, use the FIFO method to summarize total costs to account for, calculate cost per equivalent unit for direct materials and conversion costs, and assign total costs to units completed (and transferred out) and to units in end
> Refer to the information in Exercise 17-26. Suppose the assembly division at Fenton Watches Inc. uses the FIFO method of process costing instead of the weighted-average method. Required: Compute equivalent units for direct materials and conversion costs
> For the data in Exercise 17-26, summarize total costs to account for, calculate cost per equivalent unit for direct materials and conversion costs, and assign total costs to units completed (and transferred out) and to units in ending work in process. D
> Consider the following data for the assembly division of Fenton Watches Inc.: The assembly division uses the weighted-average method of process costing. Required: Compute equivalent units for direct materials and conversion costs. Show physical units
> A number of terms are listed below: target pricing …………………………………target cost per unit value engineering …………………………………value analysis price discrimination ………………………….peak-load pricing life-cycle pricing …………………customer life-cycle pricing invested capital …
> Refer to the information in Exercise 17-24. Suppose that Asaya uses the FIFO method instead of the weighted-average method in all of its departments. The only changes to Exercise 17-24 under the FIFO method are that the total transferred-in costs of begi
> Asaya Clothing Inc. is a manufacturer of winter clothes. It has a knitting department and a finishing department. This exercise focuses on the finishing department. Direct materials are added at the end of the process. Conversion costs are added evenly d
> Refer to the information in Exercise 17-19. Suppose the assembly division uses the standard-costing method of process costing. Suppose further that the assembly division determines standard costs of $700,000 per equivalent unit for direct materials and $
> For the data in Exercise 17-19, use the FIFO method to summarize total costs to account for, and assign these costs to units completed and transferred out, and to units in ending work in process. Data from Exercise 17-19: Consider the following data fo
> Refer to the information in Exercise 17-19. Suppose the assembly division uses the FIFO method of process costing instead of the weighted-average method. Required: 1. Compute equivalent units for direct materials and conversion costs. Show physical unit
> For the data in Exercise 17-19, summarize total costs to account for, and assign these costs to units completed (and transferred out) and to units in ending work in process. Data from Exercise 17-19: Consider the following data for the assembly divisio
> Consider the following data for the assembly division of a satellite manufacturer: The assembly division uses the weighted-average method of process costing. Required: 1. Compute equivalent units for direct materials and conversion costs. Show physica
> Refer to the information in Exercise 17-16. Suppose Bio Doc determines standard costs of $6.60 per equivalent unit for direct materials and $10.40 per equivalent unit for conversion costs for both beginning work in process and work done in the current pe
> Refer to the information in Exercise 17-16. Required: Do Exercise 17-16 using the FIFO method. Note that you first need to calculate the equivalent units of work done in the current period (for direct materials and conversion costs) to complete beginnin
> Bio Doc Corporation is a biotech company that makes a cancer-treatment drug in a single processing department. Direct materials are added at the start of the process. Conversion costs are added evenly during the process. Bio Doc uses the weighted-average
> A number of terms are listed below: equivalent unit (EU)………………………………………………….first-in, first-out (FIFO) weighted-average process-costing method………………standard-costing method Required: Select the terms from the above list to complete the following sentenc
> Roary Chemicals has a mixing department and a refining department. Its process-costing system in the mixing department has two direct materials cost categories (Chemical P and Chemical Q) and one conversion costs pool. The following data pertain to the m
> Journal entries (continuation of Exercise 17-13). Refer to requirement 2 of Exercise 17-13. Required: Prepare summary journal entries for the use of direct materials and incurrence of conversion costs. Also prepare a journal entry to transfer out the co
> A&A Inc. is a manufacturer of digital cameras. It has two departments: assembly and testing. In January 2015, the company incurred $750,000 on direct materials and $798,000 on conversion costs, for a total manufacturing cost of $1,548,000. Required: 1.
> Generic Inc. is a distributor of pharmaceutical products. Its ABC system has five activities: Activity Area ………………â€&brvba
> Instant Service (IS) repairs printers and photocopiers for five multisite companies in a tri-city area. IS’s costs consist of the cost of technicians and equipment that are directly traceable to the customer site and a pool of office ov
> SodaKing prepared the budget for 2015 assuming a 10% market share based on total sales in the western region of Canada. The total soft-drinks market was estimated to reach sales of 25 million cases in the region. However, actual total sales volume in the
> SodaKing manufactures and sells three soft drinks: Kola, Limor, and Orlem. Budgeted and actual results for 2015 are as follows: Required: 1. Compute the total sales-volume variance, the total sales-mix variance, and the total sales-quantity variance. (
> The Guangzhou Corporation (GC) sells two brands of wine glasses, Plain and Chic. GC provides the following information for sales in the month of June 2015: Static-budget total contribution margin ……………………………$5,600 Budgeted units to be sold of all glasse
> The Penguins play in the North American Ice Hockey League. The Penguins play in the Downtown Arena (owned and managed by the City of Downtown), which has a capacity of 15,000 seats (5,000 lower-tier seats and 10,000 upper-tier seats). The Downtown Arena
> Lee Shu-yu Inc. produces and sells DVDs to business people and students who are planning extended stays in China. It has been very successful with two DVDs: Beginning Mandarin and Conversational Mandarin. It is introducing a third DVD, Reading Chinese Ch
> What is a linear cost function? Describe three alternative linear cost functions.
> The cities of St. Anne, St. Teresa, and St. Steven are considering the implementation of a new program to handle disposal of hazardous waste to comply with a new, more stringent provincial law. Because of the close proximity of the three cities, a joint
> A number of terms are listed below: Required: Select the terms from the above list to complete the following sentences. To satisfy their customers’ value proposition and benefit from economies of scale, companies often create customi
> Sooke Sawmill Inc. (SSI) purchases logs from independent timber contractors and processes the logs into three types of lumber products: â– Studs for residential buildings (walls, ceilings). â– Decorative pieces (fireplac
> Chemtech Chemicals, a multinational company, has a subsidiary located in a small Eastern European country. The country has only a few environmental protection laws, and even those that exist are not strictly enforced. The subsidiary’s t
> Royston Inc. is a large food processing company. It processes 120,000 kilograms of peanuts in the Peanuts Department at a cost of $160,000 to yield 10,000 kilograms of product A, 60,000 kilograms of product B, and 20,000 kilograms of product C. â&#
> Crisps Inc. is a producer of potato chips. A single production process at Crisps Inc. yields potato chips as the main product and a byproduct that can also be sold as a snack. Both products are fully processed by the splitoff point, and there are no sepa
