Unit 3 Activity Based Costing and Process Costing Individual Project

social unit 3- Activity Based courting and master personcess Costing Unit 3 Individual Project By: Brenda Ward AIU-Online November 27, 2012 Cur affiancely Ski Pro Corporation has discrete to fetch cross-country skis. The ski selected is a mass-market ski with a special binding. The sale price of the skis result be $80.00 to wholesalers passim the United States. Due to available cogency no excess furbish up charges give be incurred to produce the skis, however, a $100,000 fixed charge will be take up by the skis to allocate a fair share of the political troupes present fixed represents to the new product. The estimated earn revenue and exertion of 10,000 pairs of skis as the expected volume, the accounting discussion section has develop the following cost per pair: contribute crusade$35.00 Direct Material$30.00 Total Overhead$15.00 Total Cost$80.00 below this scenario the companion will have no film headway, but no loss. In order to preserve produ ction during the off season, guardianship employees working this scenario of breakeven will provide the confederacy with the ability to impact production. Ski Pro has obtained a leverage price from a subcontractor for the bindings. The accounting department provided a predicted nest egg of 10% for groom labor and variable overhead cost with a 20% savings on the direct satisfying cost.

Under this scenario, as you seen on the spreadsheet provided, the confederation will constrain a make headway of $.50 per ski. With sales of 10,000 pair of skis the company would make a lolly of $5,000.00. The production staff will still produce the skis, yet not the b! indings. In this scenario the company will append profits, continue to keep employees working and intellectual and make a profit for the sale of the skis with the purchased bindings. If the company were to increase the sales of the skis to 12,500 they would need to rent additional equipment that would cost an annual fixed rate of $10,000.00. This equipment would change the company to produce up to 30,000 skis which is the future...If you want to get a full essay, order it on our website: BestEssayCheap.com

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