Acct Final

Question 2.2. (TCO 2) What is manufacturing overhead? What is an example of manufacturing overhead? (Points : 15)

Question 3.3. (TCO 3) What is the difference between job order and process costing?  (Points : 15)

Question 4.4. (TCO 4)  What is a variable cost?  What is an example of a variable cost? (Points : 15)

1. (TCO 5)  What is the difference between absorption costing and variable costing? (Points : 15)

Question 2.2. (TCO 6)  What is the second step in the cost allocation process?  Give an example of this step. (Points : 15)

Question 3.3. (TCO 7)  What is an incremental cost?  What is an example of one? (Points : 15)

Question 4.4. (TCO 8) What is activity-based pricing?  How is the price determined? (Points : 15)

1. (TCO 6) Identify 3 problems with cost allocation.  Describe each problem in detail. Which problem do you think it the most severe and why? (Points : 30)

Question 2.2. (TCO 7) Products Gamma and Delta are joint products. The joint production cost of the products is $800. Gamma has a market value of $500 at the split-off point. If Gamma is further processed at an additional cost of $600, its market value is $1,400. Product Delta has a market value of $1,100 at the split-off point. If Product Delta is further processed at an additional cost of $300, its market value is $1,400.  Using the relative sales value method, calculate the joint product cost that would be allocated to Gamma and Delta.  How do you know if one of the products should be further.

Question 3.3. (TCO 8) A company must incur annual fixed costs of $1,000,000 and variable costs of $200 per unit and estimates that it can sell 10,000 pumps annually and marks up cost by 30 percent.  Using cost-plus pricing, what is the cost per unit and the price? What are advantages and disadvantages of cost-plus pricing? (Points : 30)

1. (TCO 9) A project will require an initial investment of $400,000 and will return $100,000 each year for six years. If taxes are...