Worley Company buys surgical supplies from a variety of manufacturers and then resells and delivers these...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Worley Company buys surgical supplies from a variety of manufacturers and then resells and delivers these supplies to hundreds of hospitals. Worley sets its prices for all hospitals by marking up its cost of goods sold to those hospitals by 6%. For example, if a hospital buys supplies from Worley that cost Worley $100 to buy from manufacturers, Worley would charge the hospital $106 to purchase these supplies. For years, Worley believed that the 6% markup covered its selling and administrative expenses and provided a reasonable profit. However, in the face of declining profits, Worley decided to implement an activity-based costing system to help improve its understanding of customer profitability. The company broke its selling and administrative expenses into five activities as shown: Activity Cost Pool (Activity Measure) Customer del1iveries (Number of deliveries) Manual order procesning (Number of manual orders) Electronic order processing (Nunber of electronie orders) Line item pieking (Number of line items picked) Other organieation-auntaining costs (None) Total Cost $ 425,000 438,000 220,000 658,000 470,000 line itemn 640,000 Total Activity 5,000 deliveries 6,000 orders 10,000 orders Total selling and administrative expensen $2,381,000 Worley gathered the data below for two of the many hospitals that it serves-Univbrsity and Memorial (each hospital purchased medical supplies that had cost Worley $39,000 to buy from manufacturers): Activity Activity Measure Number of deliveries Nunber of manual orders Number of electronic orders Humber of line itena picked Univeraity Memorial 24 11 44 11 110 250 Required: 1. Compute the total revenue that Worley would receive from University and Memorial. 2. Compute the activity rate for each activity cost pool. 3. Compute the total activity costs that would be assigned to University and Memorial. 4. Compute Worley's customer margin for University and Memorial. (Hint Do not overlook the $39,000 cost of goods sold that Worley incurred serving each hospital.) • Read the business scenare below and propare3 page pper dsing the etical sues in detal identity and describe which MA violated the mest ineach emplyees stton andard Yeur per munt be teet. deutie et and haten eling i emen. You are encouraged to take advantage the Wing Canter the rarytor utanoe When analyaing the ises you mustlerance heMA Staement of Ethical Professional Practioe and the standards that apply inach case In addtion to the intormation in your tebook, a linko he MA organization website isin the CONTENT section ef thi unt in D You may uneadiona sources please cite them dentty the elevant tctons in ech ation the ehiol standerd hat pples and sggest what you reommend a en ef the ehical coniet Make sure you have an introdurtion tothi paperwhich desobes ovenew of the purpose el tigment, incude and a wel organid denasionfeh diemma, and a conclusion t the overalasigment Agood paper contset reterting and eplaining the given intormaton a you prve recommendations, and suggestions, and again, remember povide ons or chations when intormation used toma peoie so When your paper i complete it mut be sented thoughhe gment boin DAL The grading rubric fortha preject in alse provided Scenaro Seeetwe, Inc is he largest manufater of heting and congipmentithe Midet The aconunting departant et t Mvesota State College nd University uandng iot Anna wons in temaludt. Samworks itnanal perting. Eh worka epartment and Patael i the Assistant Conmroler. the bx Alot the alumni heve taken and passed the CMA an Howeecenty thay hae each eperienced some aticutes atwork Rell w promate Asitant Contreller te monthago nd y in pay but fels overwhemed wth the work quired H bos cendy asked him to head He doesntknowwheter to ad his way through medor make him ok ha Eve in hete depatmentrety steed by aofd bean ungacontiion of deg dewh subetance simpacting h j pet someone or keep hiding it s et he can Ana ha recenty nticed some pn in alco ens the payroll panent pping some e that re ed procede man Untontely, he pen tw gps be wdcttion wth hepar ent hand aly wonsin he pal dept Sam wona in tancl reorng ant the company they wrelesedthe pres He e fetngpre dd newhe wen ives egh m tetre mation Since hese ur atat hold he CMAetal how sh hey ew ofcut ues? Does the MA Statment of Ecal Polesonl ic can they resove these esT Ltpecicpe ach them shed te Worley Company buys surgical supplies from a variety of manufacturers and then resells and delivers these supplies to hundreds of hospitals. Worley sets its prices for all hospitals by marking up its cost of goods sold to those hospitals by 6%. For example, if a hospital buys supplies from Worley that cost Worley $100 to buy from manufacturers, Worley would charge the hospital $106 to purchase these supplies. For years, Worley believed that the 6% markup covered its selling and administrative expenses and provided a reasonable profit. However, in the face of declining profits, Worley decided to implement an activity-based costing system to help improve its understanding of customer profitability. The company broke its selling and administrative expenses into five activities as shown: Activity Cost Pool (Activity Measure) Customer del1iveries (Number of deliveries) Manual order procesning (Number of manual orders) Electronic order processing (Nunber of electronie orders) Line item pieking (Number of line items picked) Other organieation-auntaining costs (None) Total Cost $ 425,000 438,000 220,000 658,000 470,000 line itemn 640,000 Total Activity 5,000 deliveries 6,000 orders 10,000 orders Total selling and administrative expensen $2,381,000 Worley gathered the data below for two of the many hospitals that it serves-Univbrsity and Memorial (each hospital purchased medical supplies that had cost Worley $39,000 to buy from manufacturers): Activity Activity Measure Number of deliveries Nunber of manual orders Number of electronic orders Humber of line itena picked Univeraity Memorial 24 11 44 11 110 250 Required: 1. Compute the total revenue that Worley would receive from University and Memorial. 2. Compute the activity rate for each activity cost pool. 3. Compute the total activity costs that would be assigned to University and Memorial. 4. Compute Worley's customer margin for University and Memorial. (Hint Do not overlook the $39,000 cost of goods sold that Worley incurred serving each hospital.) • Read the business scenare below and propare3 page pper dsing the etical sues in detal identity and describe which MA violated the mest ineach emplyees stton andard Yeur per munt be teet. deutie et and haten eling i emen. You are encouraged to take advantage the Wing Canter the rarytor utanoe When analyaing the ises you mustlerance heMA Staement of Ethical Professional Practioe and the standards that apply inach case In addtion to the intormation in your tebook, a linko he MA organization website isin the CONTENT section ef thi unt in D You may uneadiona sources please cite them dentty the elevant tctons in ech ation the ehiol standerd hat pples and sggest what you reommend a en ef the ehical coniet Make sure you have an introdurtion tothi paperwhich desobes ovenew of the purpose el tigment, incude and a wel organid denasionfeh diemma, and a conclusion t the overalasigment Agood paper contset reterting and eplaining the given intormaton a you prve recommendations, and suggestions, and again, remember povide ons or chations when intormation used toma peoie so When your paper i complete it mut be sented thoughhe gment boin DAL The grading rubric fortha preject in alse provided Scenaro Seeetwe, Inc is he largest manufater of heting and congipmentithe Midet The aconunting departant et t Mvesota State College nd University uandng iot Anna wons in temaludt. Samworks itnanal perting. Eh worka epartment and Patael i the Assistant Conmroler. the bx Alot the alumni heve taken and passed the CMA an Howeecenty thay hae each eperienced some aticutes atwork Rell w promate Asitant Contreller te monthago nd y in pay but fels overwhemed wth the work quired H bos cendy asked him to head He doesntknowwheter to ad his way through medor make him ok ha Eve in hete depatmentrety steed by aofd bean ungacontiion of deg dewh subetance simpacting h j pet someone or keep hiding it s et he can Ana ha recenty nticed some pn in alco ens the payroll panent pping some e that re ed procede man Untontely, he pen tw gps be wdcttion wth hepar ent hand aly wonsin he pal dept Sam wona in tancl reorng ant the company they wrelesedthe pres He e fetngpre dd newhe wen ives egh m tetre mation Since hese ur atat hold he CMAetal how sh hey ew ofcut ues? Does the MA Statment of Ecal Polesonl ic can they resove these esT Ltpecicpe ach them shed te
Expert Answer:
Related Book For
Managerial Accounting
ISBN: 978-0077522940
15th edition
Authors: Ray Garrison, Eric Noreen, Peter Brewer
Posted Date:
Students also viewed these marketing questions
-
Worley Company buys surgical supplies from a variety of manufacturers and then resells and delivers these supplies to hundreds of hospitals. Worley sets its prices for all hospitals by marking up its...
-
Med Max buys surgical supplies from a variety of manufacturers and then resells and delivers these supplies to hundreds of hospitals. Med Max sets its prices for all hospitals by marking up its cost...
-
Med Max buys surgical supplies from a variety of manufacturers and then resells and delivers these supplies to dozens of hospitals. In the face of declining profits, Med Max decided to implement an...
-
Consider : You have been asked to evaluate whether your organization's current pay structure makes sense in view of what competing - address the following: How would you determine what organizations...
-
A city engineer has estimated the annual toll revenues from a newly proposed highway construction over 20 years as follows: An = ($2,000,000)(n)(1.06)n-1 n = 1,2, ...,20 To validate the bond, the...
-
Seven variables occur in a loop of a computer program. The variables and the steps during which they must be stored are t: steps 1 through 6; u: step 2; v: steps 2 through 4; w: steps 1, 3, and 5; x:...
-
Briefly describe the role of technology in conceptual, logical, and physical modeling.
-
Gifford, Lawrence, and Ma share equally in net income and net losses. After the partnership sells all assets for cash, divides the losses on realization, and pays the liabilities, the balances in the...
-
Solve the following LP using the simplex method. 4x1 + 2x2 maximize subject to -x1 + x2 < 2 4x1 x24 x1, x2 0 Use the Danzig rule (pick a variable with the most negative coefficient in z-row) to...
-
Data for Hill Oil Company are as follows for all US properties: Acquisition costs of unproved property, net of impairment.. $ 300,000 400,000 Nondrilling evaluation costs of unproved...
-
Write a paragraph describing the major trends and changes in Netflix subscribers. Paragraph should have: A clear topic sentence At least 5 supporting and detail sentences A clear concluding...
-
just to explain these topics 1 Value Proposition of accountants; Impact of current environment 2 Theories of Ethics, Ethical Issues or Dilemmas, Apply to cases 3 Professional Ethics APES110 4 ESG,...
-
As we discuss ethics this week, we will consider one area of being ethical is fulfilling an important role in a group assignment so that each member of the group can count on the others to do their...
-
Previewing "Earth's Changing Climate On page 451, read the title. Do you think climate change is real big deal? Read the "Build Background..." section on page 450. Do you know the answers to some of...
-
3. Perform analysis of the price and volume revenue drivers for each of the two products using data in Exhibit 2 . Note what you learned from the revenue driver analysis to further explain why F4S...
-
Create dialogue explaining which Debt Payoff Plan you would utilize for Nate and if it includes the Debt Consolidation Loan. What strategies would you use to relay these recommendations to Nate?
-
Select all that apply Net income attributable to noncontrolling interests will be a reduction in arriving at net income attributable to controlling shareholders. is an expense in the consolidated...
-
2. Assume a person bends forward to lift a load "with his back" as shown in Figure P12.42a. The person's spine piv- ots mainly at the fifth lumbar vertebra, with the principal supporting force...
-
Becton Labs, Inc., produces various chemical compounds for industrial use. One compound, called Fludex, is prepared using an elaborate distilling process. The company has developed standard costs for...
-
Oakmont Company has an opportunity to manufacture and sell a new product for a four-year period. The companys discount rate is 15%. After careful study, Oakmont estimated the following costs and...
-
Cherokee Inc. is a merchandiser that provided the following information: Amount Number of units sold . . . . . . . . . . . . . . . . . . . . . . . . 20,000 Selling price per unit . . . . . . . . . ....
-
Brandywine Homecare, a not-for-profit business, had revenues of \($12\) million in 2015. Expenses other than depreciation totaled 75 percent of revenues, and depreciation expense was \($1.5\)...
-
Great Forks Hospital reported net income for 2015 of \($2.4\) million on total revenues of \($30\) million. Depreciation expense totaled \($1\) million. a. What were total expenses for 2015? b. What...
-
What is the relationship between the retained earnings account on the balance sheet and earnings (net income) reported on the income statement?
Study smarter with the SolutionInn App