Cathy and Tom's Specialty Ice Cream Company operates a small production facility for the local community....
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Cathy and Tom's Specialty Ice Cream Company operates a small production facility for the local community. The facility has the capacity to make 19,200 gallons of the single flavor, GUI Chewy, annually. The plant has only two customers, Chuck's Gas & Go and Marcee's Drive & Chew DriveThru. Annual orders for Chuck's total 9,600 gallons and annual orders for Marcee's total 4,800 gallons. Variable manufacturing costs are $.70 per gallon, and annual fixed manufacturing costs are $28,800. The ice cream business has two seasons, summer and winter. Each season lasts exactly six months. Chuck's orders 4,800 gallons in the summer and 4,800 gallons in the winter. Marcee's is closed in the winter and orders all 4,800 gallons in the summer. In discussing their business, Cathy and Tom realize that there are really three seasons instead of two, the third being the fall and spring (as a combined season). Each of the three seasons lasts exactly four months. They also know that Marcee's opens in mid-spring and closes in mid-fall, Cathy and Tom check the order patterns and see the following demand (in gallons) in each of the three seasons: Fall and Winter Spring 3, 200 1, 600 Summer Chuck' s Marcee's 3, 200 3, 200 Total 9, 600 4, 800 3, 200 Total 3, 200 4, 800 6, 400 14, 400 Required: Design the cost system for Cathy and Tom showing the capacity costs and capacity in each season. (Round "Fixed cost" and "Variable cost" to 2 decimal places.) Capacity Costs Winter Fall/Spring Summer Total Unused Used O $ 0 $ Charge for unused Total capacity costs 0 $ 0 $ Production (gallons) Cathy and Tom's Specialty Ice Cream Company operates a small production facility for the local community. The facility has the capacity to make 19,200 gallons of the single flavor, GUI Chewy, annually. The plant has only two customers, Chuck's Gas & Go and Marcee's Drive & Chew DriveThru. Annual orders for Chuck's total 9,600 gallons and annual orders for Marcee's total 4,800 gallons. Variable manufacturing costs are $.70 per gallon, and annual fixed manufacturing costs are $28,800. The ice cream business has two seasons, summer and winter. Each season lasts exactly six months. Chuck's orders 4,800 gallons in the summer and 4,800 gallons in the winter. Marcee's is closed in the winter and orders all 4,800 gallons in the summer. In discussing their business, Cathy and Tom realize that there are really three seasons instead of two, the third being the fall and spring (as a combined season). Each of the three seasons lasts exactly four months. They also know that Marcee's opens in mid-spring and closes in mid-fall, Cathy and Tom check the order patterns and see the following demand (in gallons) in each of the three seasons: Fall and Winter Spring 3, 200 1, 600 Summer Chuck' s Marcee's 3, 200 3, 200 Total 9, 600 4, 800 3, 200 Total 3, 200 4, 800 6, 400 14, 400 Required: Design the cost system for Cathy and Tom showing the capacity costs and capacity in each season. (Round "Fixed cost" and "Variable cost" to 2 decimal places.) Capacity Costs Winter Fall/Spring Summer Total Unused Used O $ 0 $ Charge for unused Total capacity costs 0 $ 0 $ Production (gallons)
Expert Answer:
Related Book For
Fundamentals of Cost Accounting
ISBN: 978-0077398194
3rd Edition
Authors: William Lanen, Shannon Anderson, Michael Maher
Posted Date:
Students also viewed these general management questions
-
Variable manufacturing costs are $ 13 per unit, and fixed manufacturing costs are $ 75,000. Sales are estimated to be 12,000 units. a. How much would absorption costing income from operations differ...
-
Variable manufacturing costs are $ 126 per unit, and fixed manufacturing costs are $ 157,500. Sales are estimated to be 10,000 units. a. How much would absorption costing income from operations...
-
Variable manufacturing costs are $22 per unit, and fixed manufacturing costs are $110,000. Sales are estimated to be 20,000 units. a. How much would absorption costing income from operations differ...
-
Three years ago, Witt Gas Controls purchased equipment for $80,000 that was expected to have a useful life of 5 years with a $9000 salvage value . Increased demand necessitated an upgrade costing...
-
A random sample of 50 medical school applicants at a university has a mean raw score of 31 on the multiple choice portions of the Medical College Admission Test (MCAT). A student says that the mean...
-
Chemet manufactures chemicals in a continuous process. The company combines various materials in a specially configured machine at the beginning of the process, and conversion is considered uniform...
-
Indicate the purposes served by production orders in the production cycle.
-
Barrymore Costume Company, located in New York City, sews costumes for plays and musicals. Barrymore considers itself primarily a service firm, as it never produces costumes without a pre-existing...
-
Entertainment technology introduction and conclusion? What is cloud gaming ? How has cloud gaming impacted the sector in terms of the H&T industry? How has tourism sector adapted to cloud gaming...
-
Researchers have found that normally frugal buyers are, when spending others money on themselves (Value Formula C), often less cost-conscious when purchasing than they otherwise would be. Identify at...
-
IS 1 So Georgetown Cupcake in Washington, D.C. bakes delicious gourmet cupcakes. Cupcake bakeries are a (perfectly) competitive business in this area so keeping costs under control matters. At its...
-
On the moon, the acceleration due to gravity is 1 . 6 3 meters per second . Suppose you are standing on the moon and see a rock falling. At the instant you see it , the rock is 3 0 meters above the...
-
The wind blows a boy on a raft East for 2 0 km , then blows 1 1 degrees South of East for 1 5 km . The boy falls asleep and the wind blows the raft 6 0 degrees North of West for 1 4 km , at which...
-
A 7 . 4 5 - nC charge is located 1 . 8 6 m from a 4 . 5 0 - nC point charge. ( a ) Find the magnitude of the electrostatic force that one charge exerts on the other.
-
How much heat is required to raise a temperature of 7 . 9 3 KG of water from 3 4 . 3 2 Celsius to 8 2 . 0 4 Celsius the specific heat of water in the state is 4 1 8 6 J / KG Celsius
-
A sprinter runs the curve of this 2 0 0 m in 1 3 . 2 8 s . Assume he ran in a lane which makes a semicircle ( r = 3 6 . 1 m ) for the first part of the race. At 3 . 0 6 s into the race his speed is 4...
-
Assume an 11-bit binary floating point model with 1 bit used for the sign, 6 bits for the exponent with a bias of 31, and 4 bits for the fraction. Assuming that the values for infinity, NaN, and...
-
Drainee purchases direct materials each month. Its payment history shows that 65% is paid in the month of purchase with the remaining balance paid the month after purchase. Prepare a cash payment...
-
Refer to Problem 9-46. Jean Sharpe decides to gather additional data to identify the cause of overhead costs and figure out which products are most profitable. She notices that $30,000 of the...
-
Consider your campus bookstore. Who do you think are the stakeholders ? What do you think are its critical success factors? How would they differ from those of a retail bookstore in a city without a...
-
Some people argue that paying contingent compensation is unnecessary. Instead, the firm should just pay a fair salary and the manager will do what is expected. Do you agree?
-
Show that the log-likelihood in equation (12.2) has a maximum at \(\widehat{\mu}=\bar{y}\). n L() Inf(y,) = (-+y; In - In y;!). i=1 i=1 (12.2)
-
Consider a random walk \(\left\{y_{t} ight\}\) as the partial sum of a white noise process \(\left\{c_{t} ight\}\). a. Show that the \(l\)-step forecast error is...
-
Verify the entries in Table 13.8 for the gamma distribution. Specifically: a. Show that the gamma is a member of the linear exponential family of distributions. b. Describe the components of the...
Study smarter with the SolutionInn App