Xavier Products Company is in the process of adopting the just-in-time operating philosophy for its trophy-making operations. Indicate which of the following overhead costs is a nonvalue-adding cost (NVA)
a. Machine electricity
b. Machine repairs
c. Depreciation of the coffee machine
d. Machine setup labor
C
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The total variable overhead variance is comprised of the
a. variable overhead efficiency and fixed variances. b. fixed overhead budget and volume variances. c. variable overhead spending and efficiency variances. d. labor efficiency and rate variances.
A company exchanged its used machine for a new machine in a transaction that had commercial substance. The old machine cost $68,000, and the new one had a cash price of $95,000. The company had taken $59,000 depreciation on the old machine and was allowed a $2,500 trade-in allowance and the balance of $92,500 was paid in cash. What gain or loss should be recorded on the exchange?
What will be an ideal response?
______ is the division of a single lot into two or more sublots and simultaneously processing each sublot on identical (or very similar) work centers as separate lots.
a. Lot processing b. Lot splitting c. Lot allocating d. Lot wrapping
Fairmount Corporation produces and sells a single product. Data concerning that product appear below: Per Unit Percent of SalesSelling price $120 100% Variable costs 36 30% Contribution margin $84 70% Fixed costs are $516,000 per month. The company is currently selling 7,000 units per month.Required:The marketing manager would like to introduce sales commissions as an incentive for the sales staff. The marketing manager has proposed a commission of $9 per unit. In exchange, the sales staff would accept an overall decrease in their salaries of $55,000 per month. The marketing manager predicts that introducing this sales incentive would increase monthly sales by 200 units. What should be the overall effect on the company's monthly operating profit of these
changes? What will be an ideal response?