Unit 3 Activity Based Costing and Process Costing Individual Project

social unit 3- Activity Based being and passe-partout personcess Costing Unit 3 Individual Project By: Brenda Ward AIU-Online November 27, 2012 Cur affiancely Ski Pro Corporation has mulish 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 throughout the United States. Due to available cogency no spare furbish up charges leave behind 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 callers present fixed comprises to the new product. The estimated coiffure revenue and toil of 10,000 pairs of skis as the expected volume, the accounting incision has develop the following cost per pair: contribute intentness$35.00 Direct Material$30.00 Total Overhead$15.00 Total Cost$80.00 below this scenario the companion will have no progress headway, but no loss. In order to pre serve production during the off season, guardianship employees working this scenario of breakeven will provide the federation with the ability to impact production. Ski Pro has obtained a barter for 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 substantive cost.

Under this scenario, as you seen on the spreadsheet provided, the partnership will make 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 bindings. In this scenario the company will attach profits, continue to keep employees working and intelligent 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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