Munoz Sporting Equipment manufactures baseball bats and tennis rackets. Department B produces the baseball bats, and Department T produces the tennis rackets. Munoz currently uses plantwide allocation to allocate its overhead to all products. Direct labor cost is the allocation base. The rate used is 200 percent of direct labor cost. Last year, revenue, materials, and direct labor were as follows:
Dept. B Dept. T
Baseball Bats Tennis Rackets
Revenue $1,350,000 $900,000
Direct Labor $250,000 $125,000
Direct Materials $550,000 $275,000
Required
a. Compute the profit for each product using plantwide allocation.
b. Maria, the manager of Department T, was convinced that tennis rackets were really more profitable than baseball bats. She asked her colleague in accounting to break down the overhead costs for the two departments. She discovered that had department rates been used, Department B would have had a rate of 150 percent of direct labor cost and Department T would have had a rate of 300 percent of direct labor cost. Re-compute the profits for each product using each department’s allocation rate (based on direct labor cost)?
c. Why are the results different in requirements (a) and (b)?
Answers: 3
Business, 22.06.2019 23:30, bb1593
As a result of a thorough physical inventory, waterway company determined that it had inventory worth $320200 at december 31, 2020. this count did not take into consideration the following facts: walker consignment currently has goods worth $47400 on its sales floor that belong to waterway but are being sold on consignment by walker. the selling price of these goods is $75900. waterway purchased $21900 of goods that were shipped on december 27, fob destination, that will be received by waterway on january 3. determine the correct amount of inventory that waterway should report.
Answers: 2
Business, 23.06.2019 02:20, chaanah
The director of the federal trade commission (ftc) bureau of consumer protection warned that the agency would bring enforcement action against small businesses that select one: a. failed to inform the public about network failures in a timely manner b. failed to transmit sensitive data c. did not report security breaches to law enforcement d. lacked adequate policies and procedures to protect consumer data.
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Munoz Sporting Equipment manufactures baseball bats and tennis rackets. Department B produces the ba...
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