Mike's Radiator Services specializes in the repair and replacement of radiators for passenger vehicles. Variable and...
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Mike's Radiator Services specializes in the repair and replacement of radiators for passenger vehicles. Variable and fixed costs related to installation activities for the most recent month (January) are listed below: Item Number of radiators replaced Variable expenses: Direct materials (new radiators) Direct labour (2 hours per installation) Indirect materials. Fixed expenses: Installation supervisor's wages. Equipment depreciation Insurance and utilities for garage Item Variable expenses Direct materials (new radiators) Direct labour (2 hours per installation) Indirect materials Required: 1. Calculate the per unit amounts for each of the variable expense and fixed expense items in January. Fixed expenses Installation supervisor's wages Equipment depreciation. Insurance and utilities for garage Item Per Unit Variable expenses. Direct materials (new radiators). Direct labour (2 hours per installation) Indirect materials $ $ $ Fixed expenses: Installation supervisor's wages Equipment depreciation Insurance and utilities for garage $ $ $ 500 50 5 80 10 7 2. Mike expects that 80 radiators will be installed in February and that this level of activity is within the relevant range for all variable and fixed expenses. 100 $50,000 5,000 500 a & b-1. Calculate the total expense and per unit amounts for each of the variable and fixed cost items above. (Round "per unit" answers to 2 decimal places.) $ 8,000 1,000 700 February (Total Cost) February Per Unit S 50,000 S 625.00 b-2. Explain any differences in the per unit amounts between January and February. 3. Which, if any, of the costs shown above would be considered sunk costs? Why? Mike's Radiator Services specializes in the repair and replacement of radiators for passenger vehicles. Variable and fixed costs related to installation activities for the most recent month (January) are listed below: Item Number of radiators replaced Variable expenses: Direct materials (new radiators) Direct labour (2 hours per installation) Indirect materials. Fixed expenses: Installation supervisor's wages. Equipment depreciation Insurance and utilities for garage Item Variable expenses Direct materials (new radiators) Direct labour (2 hours per installation) Indirect materials Required: 1. Calculate the per unit amounts for each of the variable expense and fixed expense items in January. Fixed expenses Installation supervisor's wages Equipment depreciation. Insurance and utilities for garage Item Per Unit Variable expenses. Direct materials (new radiators). Direct labour (2 hours per installation) Indirect materials $ $ $ Fixed expenses: Installation supervisor's wages Equipment depreciation Insurance and utilities for garage $ $ $ 500 50 5 80 10 7 2. Mike expects that 80 radiators will be installed in February and that this level of activity is within the relevant range for all variable and fixed expenses. 100 $50,000 5,000 500 a & b-1. Calculate the total expense and per unit amounts for each of the variable and fixed cost items above. (Round "per unit" answers to 2 decimal places.) $ 8,000 1,000 700 February (Total Cost) February Per Unit S 50,000 S 625.00 b-2. Explain any differences in the per unit amounts between January and February. 3. Which, if any, of the costs shown above would be considered sunk costs? Why?
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Related Book For
Managerial Accounting
ISBN: 978-1259024900
9th canadian edition
Authors: Ray Garrison, Theresa Libby, Alan Webb
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