An assembly plant accumulates its variable and fixed manufacturing overhead costs in a
single cost pool, which is then applied to work in process using a single application base.
The assembly plant management wants to estimate the magnitude of the total manufacturing overhead costs for different volume levels of the application activity base using a flexible budget formula. If there is an increase in the application activity base that is within the relevant range of activity for the assembly plant, which one of the following relationships regarding variable and is true?
Which of the following is a strategy that organizations can use to stimulate innovation?
1.Source from the most advanced suppliers.
2.Establish employee programs that reward initiative.
3.Identify best practice competitors as motivators.
4.Ensure that performance targets are always achieved.
A manufacturer has been approached by a new customer who wants to place a one-time order for a component similar to one that the manufacturer makes for another customer. Existing sales will not be affected by acceptance of this order. The manufacturer has a policy of setting its targeted selling price at 60% over full manufacturing cost. The manufacturing costs and the targeted selling price for the existing product are presented below.
The manufacturer has excess capacity to produce the quantity of the component desired by the new customer. The direct materials used in the component for the new customer would cost the manufacturer US $0.25 less than the component currently being made.
The variable selling expenses packaging and shipping) would be the same, or US $0.90
per unit. Under those, circumstances, the minimum unit price at which the manufacturer would accept the special order is one exceeding.
Your company (Company Y) has decided to enter the European market with one of its products and is now considering three advertising strategies. This market currently belongs to Company X. Company X is aware that your company is entering the market and is itself considering steps to protect its market. An analyst for your company has identified three strategies Company X might develop and has shown the payoffs for each in the tables below.
The analyst has formulated this problem as a:
A Gantt chart:
