Class Notes (837,539)
Canada (510,303)
Business (3,287)
BU247 (86)
Lecture

February 13.docx

4 Pages
91 Views
Unlock Document

Department
Business
Course
BU247
Professor
Esther Maier
Semester
Winter

Description
February 13, 2014 BU247 Indirect Labour/ Computer / Machines ------ costs Run Machines 70%/ Setup 30% / ---- activities Case 4-15 4-16 Madison Dairy -products are barely contributing on the bottom line -products enjoy margin on 18% -go through transition where they didn’t need as much setup time -making less product for example only chocolate and vanilla was only 140% overhead of DLC but the more they increase their variety the more the DLC increases -the quality control issue arises when they have more variety for example they would need to clean the machine to make strawberry and mocha almond vs vanilla and chocolate where they could put chocolate syrup to vanilla ice cream to make chocolate ice cream -by allocating the true cost 4-5 would show the actual % of sales towards each product -problem: cost more time to make strawberry and mocha almond but only produces very little Note: 7 employees and two machines as stated on the text Overheads use to be allocated at 140% of direct cost before specialty flavours introduced Additional Cost Days per Hours per Number Total Rate Data Given month day Indirect $4655.00 19 7 133 $35 labour Machinery $15400.00 22 7 2 308 $50 Computer $18.00 Need Practical capacity info & how to assign usage cost Energy costs $4000 22 days per 7 hours a day 2 22*7*2 =308 4000/308 = – machinery month $12.99 New rate – $62.99 machinery Additional Cost Days per Hours per Number Total Rate Data Given month day Indirect $4655.00 19 7 133 $35 labour Machinery $15400.00 22 7 2 308 $50 A New Indirect $5120.50 19 7 133 5120/133 Labour =$38.50 $4655 x 1.1 Exhibit 4-5 Vanilla Chocolate Strawberry Mocha Total almond A Indirect 4515/35 3255/35 3535/35 3675/35 129+93+101+105=4 labour hours =129 = 93 =101 = 105 28 hours A Indirect 129*38.50 93*38.50 101*38.50 105*38.50 $16478 labour total =$4967 =3581 =3889 = 4043 (new) Exhibit 4-2 Indirect labour Original hours by product Vanilla Chocolate Strawberry Mocha almond Indirect labour 4.0 4.0 4.0 4.0 hours – prod runs 2 1 2.5 4 3 3 3 3 6 3 7.5 12.0 10.0 7.0 11.5 16.0 Number of 12 12 8
More Less

Related notes for BU247

Log In


OR

Join OneClass

Access over 10 million pages of study
documents for 1.3 million courses.

Sign up

Join to view


OR

By registering, I agree to the Terms and Privacy Policies
Already have an account?
Just a few more details

So we can recommend you notes for your school.

Reset Password

Please enter below the email address you registered with and we will send you a link to reset your password.

Add your courses

Get notes from the top students in your class.


Submit