Homework Help Question & Answers

Listed here are the total costs associated with the production of 1,000 drum sets manufactured by...

Listed here are the total costs associated with the production of 1,000 drum sets manufactured by TrueBeat. The drum sets selAssume, due to the significant success of the drum sets, TrueBeat has obtained a contract to provide drum sets to a national+ TrueBeat adjusted summarized data for production 4,000 to 8,000 units Total Adjust summarized data Average Cost per Unit Do

Listed here are the total costs associated with the production of 1,000 drum sets manufactured by TrueBeat. The drum sets sell for $553 each. Costs 1. Plastic for casing-$21,000 2. Wages of assembly workers-$82,000 3. Property taxes on factory-$7,000 4. Accounting staff salaries-$32,000 5. Drum stands (1,000 stands purchased) $40,000 6. Rent cost of equipment for sales staff-$36,000 7. Upper management salaries-$220,000 8. Annual flat fee for factory maintenance service-$14,000 9. Sales commissions $18 per unit 10. Machinery depreciation, straight-line-$47,000
Assume, due to the significant success of the drum sets, TrueBeat has obtained a contract to provide drum sets to a national merchandising chain. This contract is expected to increase TrueBeat's sales over the next 3 years. Current operations have a relevant range of 500 to 1,800 drum sets. TrueBeat's anticipates selling 3,000 units in Year 2, 5,000 units in Year 3 and 6,000 units in Year 4. Making the following cost changes, TrueBeat will increase their relevant range of production to between 4,000 and 8,000 drum sets. This significant increase to production will stair-step some of their costs. Specifically, the company will have to purchase additional equipment that will increase their machinery depreciation expense by 50% (Fixed overhead. The new equipment will allow TrueBeat to produce up to 10,000 drum sets a year. With increased production levels, TrueBeat will need to pay shift premium to assembly workers such that the average Direct labor will increase by $18 a unit. Additionally, production supervisor will be hired for $120,000 (fixed overhead). • Additionally, the company providing factory maintenance services has agreed to a new contract. The new contract will include a fixed component (overhead) equal to half of the original flat fee and a variable component (overhead) that will be 50.25 per assembly wage dollars The company needs to increase its sales staff. Rather than paying their sales staff commission only, TrueBeat will pay sales staff a flat salary (fixed S&A) equal to twice the amount paid in Year 1 and a reduced commission per drum set equal to 50% of the previous commission rate. 1 All other costs are considered consistent and within relevant range for production of 4,000 to 8,000 units. Use the information provided above to adjust amounts from the table in 1). Include the adjusted amounts in the table below.
+ TrueBeat adjusted summarized data for production 4,000 to 8,000 units Total Adjust summarized data Average Cost per Unit Dollars Direct materials 21 Direct labor Variable manufacturing overhead $ Fixed manufacturing overhead $ Fixed selling & administrative expense Variable selling & administrative expense $ Sales price per unit $
0 0
Add a comment
Answer #1

truebeat adjusted summerized data for production of 4000 to 8000 units

adjust summerized data Average Cost per unit Total Dollars
Direct Materials 21 -
Direct Labour 100 -
Variable manufacturing Overhead 65 -
Fixed manufacturing overhead - 204,500
Fixed selling & Administrative Expenses - 324,000
Variable Selling & Administrative Expenses 9
Variable Manufacturing Overhead Fixed Manufacturing Overhead Fixed Selling and Admin Expenses Variable Selling & Admin Expenses
                1 plastic for casing                    21
                2 wages for assembly workers                  100 120,000
                3 property taxes on factory         7,000
                4 accounting staff salaries      32,000
                5 drum stands                    40
                6 rent cost of equipment for sales staff      36,000
                7 upper management salary 220,000
                8 annual flat fee for factory maintenance                    25         7,000
                9 sales commission      36,000                 9
              10 Machinery Depreciation       70,500
                 186 204,500 324,000                 9

1. calculation of depreciation:

as per question 50% increase depreciation

existing deprecition = 47000

decpreciation = 47000/100*150

= $ 70,500

2. shift premium to assembly workers such that the average direct labour will increase by $ 18 a unit.

existing labour = $ 82000 for 1000 drums capacity

average labour per unit = 82000/1000

=82

hence labour = 82+18

= $100

and production supervisor salary $120,000 (fixed)

3. calculation of factory maintenance annul flat fee

existing factory maintenance = $ 14000

condition : half of the original value is fixed = 14000/2 = $7000

and variale cost $0.25 per assembly wage dollars

assembly wage $ 100 per unit

=100 X 0.25

variable factory maintenance = $ 25 per unit

fixed factory maintenance = 7,000

4. sales staff salary paid in 1st year = 18000

previous commission = $ 18 per unit

condition : twice of the amount paid in year 1 and commission reduced by 50% of the previous commission

hence sales staff salary =18000x2

   =$ 32000

hence commission = 18 - (18X50%)

= $ 9 per unit

Add a comment
Know the answer?
Add Answer to:
Listed here are the total costs associated with the production of 1,000 drum sets manufactured by...
Your Answer:

Post as a guest

Your Name:
What's your source?

Earn Coin

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions
  • Listed here are the total costs associated with the production of 1,000 drum sets manufactured by...

    Listed here are the total costs associated with the production of 1,000 drum sets manufactured by TrueBeat. The drum sets sell for $540 each.    Plastic for casing—$15,000. Wages of assembly workers—$90,000 Property taxes on factory—$8,000 Accounting staff salaries—$42,000 Drum stands (1,000 stands purchased)—$38,000 Rent cost of equipment for sales staff—$36,000 Upper management salaries—$205,000 Annual flat fee for factory maintenance service—$20,000 Sales commissions—$25 per unit Machinery depreciation, straight-line—$35,000 TrueBeat – Summarized connect given data Average Cost per Unit Total Dollars...

  • The following information applies to the questions displayed below.) Listed here are the total costs associated...

    The following information applies to the questions displayed below.) Listed here are the total costs associated with the production of 1,000 drum sets manufactured by TrueBeat. The drum sets sell for $516 each. Costs 1. Plastic for casing-$19.000 2. Wages of assembly workers--$90,000 3. Property taxes on factory-$7,000 4. Accounting staff salarles-$33.000 5. Drum stands (1.000 stands purchased)-$35,000 6. Rent cost of equipment for sales staff-$36.000 7. Upper management salaries--$170,000 8. Annual flat fee for factory maintenance service-$16,000 9. Sales...

  • Listed here are the total costs associated with the production of 1,000 drum sets manufactured by...

    Listed here are the total costs associated with the production of 1,000 drum sets manufactured by TrueBeat. The drum sets sell for $540 each.    Costs Plastic for casing—$15,000 Wages of assembly workers—$90,000 Property taxes on factory—$8,000 Accounting staff salaries—$42,000 Drum stands (1,000 stands purchased)—$38,000 Rent cost of equipment for sales staff—$36,000 Upper management salaries—$205,000 Annual flat fee for factory maintenance service—$20,000 Sales commissions—$25 per unit Machinery depreciation, straight-line—$35,000 New Plant? Because TrueBeat’s capacity is limited to 8,000 units in...

  • Listed here are the total costs associated with the production of 1,000 drum sets manufactured by...

    Listed here are the total costs associated with the production of 1,000 drum sets manufactured by TrueBeat. The drum sets sell for $540 each.    Costs Plastic for casing—$15,000 Wages of assembly workers—$90,000 Property taxes on factory—$8,000 Accounting staff salaries—$42,000 Drum stands (1,000 stands purchased)—$38,000 Rent cost of equipment for sales staff—$36,000 Upper management salaries—$205,000 Annual flat fee for factory maintenance service—$20,000 Sales commissions—$25 per unit Machinery depreciation, straight-line—$35,000 Increase Fixed Costs: TrueBeat’s management is also considering purchasing additional advertising...

  • Listed here are the total costs associated with the production of 1,000 drum sets manufactured by...

    Listed here are the total costs associated with the production of 1,000 drum sets manufactured by TrueBeat. The drum sets sell for $553 each. Costs 1. Plastic for casing-$21,000 2. Wages of assembly workers-$82,000 3. Property taxes on factory-$7,000 4. Accounting staff salaries-$32,000 5. Drum stands (1,000 stands purchased) $40,000 6. Rent cost of equipment for sales staff-$36,000 7. Upper management salaries-$220,000 8. Annual flat fee for factory maintenance service-$14,000 9. Sales commissions $18 per unit 10. Machinery depreciation, straight-line-$47,000...

  • Listed here are the total costs associated with the production of 1,000 drum sets manufactured by...

    Listed here are the total costs associated with the production of 1,000 drum sets manufactured by TrueBeat. The drum sets sell for $553 each. Costs 1. Plastic for casing-$21,000 2. Wages of assembly workers-$82,000 3. Property taxes on factory-$7,000 4. Accounting staff salaries-$32,000 5. Drum stands (1,000 stands purchased) $40,000 6. Rent cost of equipment for sales staff-$36,000 7. Upper management salaries-$220,000 8. Annual flat fee for factory maintenance service-$14,000 9. Sales commissions $18 per unit 10. Machinery depreciation, straight-line-$47,000...

  • Listed here are the total costs associated with the production of 1,000 drum sets manufactured by...

    Listed here are the total costs associated with the production of 1,000 drum sets manufactured by TrueBeat. The drum sets sell for $500 each. Variable or Fixed Product or Period Costs Variable Fixed Product Period $17,000 $17,000 1. Plastic for casing-$17,000 2. Wages of assembly workers-$82,000 3. Property taxes on factory-$5,000 4. Accounting staff salaries-$35,000 5. Drum stands (1,000 stands purchased)-$26,000 6. Rent cost of equipment for sales staff-$10,000 7. Upper management salaries—$125,000 8. Annual flat fee for factory maintenance...

  • Listed here are the total costs associated with the production of 1,000 drum sets manufactured by...

    Listed here are the total costs associated with the production of 1,000 drum sets manufactured by TrueBeat. The drum sets sell for $553 each. Costs 1. Plastic for casing-$21,000 2. Wages of assembly workers-$82,000 3. Property taxes on factory-$7,000 4. Accounting staff salaries-$32,000 5. Drum stands (1,000 stands purchased) $40,000 6. Rent cost of equipment for sales staff-$36,000 7. Upper management salaries-$220,000 8. Annual flat fee for factory maintenance service-$14,000 9. Sales commissions $18 per unit 10. Machinery depreciation, straight-line-$47,000...

  • Listed here are the total costs associated with the production of 1,000 drum sets manufactured by...

    Listed here are the total costs associated with the production of 1,000 drum sets manufactured by TrueBeat. The drum sets sell for $553 each. Costs 1. Plastic for casing-$21,000 2. Wages of assembly workers-$82,000 3. Property taxes on factory-$7,000 4. Accounting staff salaries-$32,000 5. Drum stands (1,000 stands purchased) $40,000 6. Rent cost of equipment for sales staff-$36,000 7. Upper management salaries-$220,000 8. Annual flat fee for factory maintenance service-$14,000 9. Sales commissions $18 per unit 10. Machinery depreciation, straight-line-$47,000...

  • Listed here are the total costs associated with the 2017 production of 1,000 drum sets manufactured...

    Listed here are the total costs associated with the 2017 production of 1,000 drum sets manufactured by TrueBeat. The drum sets sell for $463 each. Costs 1. Plastic for casing-$17,000 2. Wages of assembly workers-$87,000 3. Property taxes on factory-$5,000 4. Accounting staff salaries-$40,000 5. Drum stands (1,000 stands purchased)-$30,000 6. Rent cost of equipment for sales staff-$24,000 7. Upper management salaries-$150,000 8. Annual flat fee for factory maintenance service-$17,000 9. Sales commissions-$13 per unit 10. Machinery depreciation, straight-line 42,000...

Free Homework App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.