Jo Nathan Publishing Company specializes in printing specialty textbooks for a small but profitable college market. Due

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Jo Nathan Publishing Company specializes in printing specialty textbooks for a small but profitable college market. Due to the high setup costs for each batch printed, Jo Nathan holds the book requests until demand for a book is approximately 500. At that point Jo Nathan will schedule the setup and production of the book. For rush orders, Jo Nathan will produce smaller batches for an additional charge of $400 per setup. Budgeted and actual costs for the printing process for 2012 were as follows:

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Required1. What is the static budget number of setups for 2012?2. What is the flexible budget number of setups for 2012?3. What is the actual number of setups in 2012?4. Assuming fixed setup overhead costs are allocated using setup-hours, what is the predetermined fixed setup overhead allocation rate?5. Does Jo Nathan's charge of $400 cover the budgeted direct variable cost of an order? The budgeted total cost?6. For direct variable setup costs, compute the price and efficiency variances.7. For fixed setup overhead costs, compute the spending and the production-volume variances.8. What qualitative factors should Jo Nathan consider before accepting or rejecting a specialorder?

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Related Book For  book-img-for-question

Cost Accounting A Managerial Emphasis

ISBN: 978-0132109178

14th Edition

Authors: Charles T. Horngren, Srikant M.Dater, George Foster, Madhav

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