Question: Les Pulaski is the supervisor of a new division of
Les Pulaski is the supervisor of a new division of Innovation Corporation. Her annual bonus is based on the success of new products and is computed on the number of sales that exceed each new product’s projected breakeven point. In reviewing the computations supporting her most recent bonus, Pulaski found that although an order for 7,500 units of a new product called R56 had been refused by a customer and returned to the company, the order had been included in the bonus calculations. She later discovered that the company’s accountant had labeled the return an overhead expense and had charged the entire cost of the returned order to the plant wide Overhead account. The result was that product R56 appeared to exceed breakeven by more than 5,000 units and Pulaski’s bonus from this product amounted to over $1,000. What actions should Pulaski take? Be prepared to discuss your response in class.
Answer to relevant QuestionsRefer to the information in C3. In January 2015, the president of Datura, Ltd., conducted a strategic planning meeting. During the meeting, the vice president of distribution noted that because of a new contract with an ...How are understandability and comparability enhanced when knowing who is responsible for the budgeting process?The projections of direct materials purchases that follow are for Creek Corporation.The company pays for 60 percent of purchases on account in the month of purchase and 40 percent in the month following the purchase. ...Eco Door Company manufactures garage door units. The units include hinges, door panels, and other hardware. The controller has provided the information that follows.Prepare a direct materials purchases budget for the first ...Assume that you work in the accounting department of a small shipping services company. Inspired by a recent seminar on budgeting, the company’s president wants to develop a budgeting system and has asked you to direct it. ...
Post your question