Mr. Ed, the manager of Stick Horses Manufacturing, wants to treat all depreciation as a product cost arguing that without the buildings ( administrative as well as manufacturing), the company could not produce the product; therefore, depreciation on administrative facilities should be treated as a product cost and allocated to the production process and thereby cost of goods sold. He further argues that it makes no difference in the long run, a cost is a cost and all costs end up on the income statement. Do you agree with his argument? Why or why not?
Answer to relevant QuestionsMyWare is a computer software retailer located in Portland. Its product is a state- of- the- art software package, with a $ 300 selling price. The fixed operating costs are $ 40,000 per period. The variable cost per software ...Explain the differences among piece- rate, commission, hourly, and salary pay. Weede Company’s expected gross payroll for the period is $ 250,000. Assuming that its FICA rate is 7.65 percent, its FUTA rate is 0.8 percent, and its SUTA rate is 5.4 percent, what is the expected pay-roll tax for the ...Grauberger Company has provided the following budgeting information for you to determine its expected bonus payments and cash outflows. Grauberger’s bonus rate is 15 percent and its tax rate is 20 percent. Sales $ ...Compare and contrast mandated and participatory budgeting.
Post your question