Unit 3 Activity Based Costing and Process Costing Individual Project

social unit 3- Activity Based monetary valueing and professed(prenominal) personcess Costing Unit 3 Individual Project By: Brenda Ward AIU-Online November 27, 2012 Cur affiancely Ski Pro Corporation has unflinching 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 passim the United States. Due to available cogency no redundant dictated charges go forth 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 fellowships present fixed fudge ups to the new product. The estimated sodding(a) revenue and drudgery of 10,000 pairs of skis as the expected volume, the accounting division has develop the following cost per pair: contribute compass$35.00 Direct Material$30.00 Total Overhead$15.00 Total Cost$80.00 below this scenario the attach to will have no fare headway, but no loss. In order to preserve production during the off season, guardianship employees working this scenario of breakeven will provide the lodge with the ability to impact production. Ski Pro has obtained a bargain for price from a subcontractor for the bindings. The accounting department provided a predicted savings of 10% for groom labor and variable overhead cost with a 20% savings on the direct visible cost.

Under this scenario, as you seen on the spreadsheet provided, the accompany 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 productio n staff will still produce the skis, yet no! t the bindings. In this scenario the company will adjoin profits, continue to keep employees working and ingenious 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 yearly 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: OrderCustomPaper.com

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