(CMA, adapted) Vineyard Test Laboratories does heat testing (HT) and stress testing (ST) on materials and operates at capacity. Under its current simple costing system, Vineyard aggregates all operating costs of 1,190,000 into a single overhead cost pool. Vineyard calculates a rate per test hour of $ 17 (1,190,000/70,000 total test hours). HT uses 40,000 test hours and ST uses 30,000 test hours. Gary Celeste, Vineyard�s controller, believes there is enough variation in test procedures and cost structures to establish separate costing and billing rates for HT and ST. The market for test services is becoming competitive. Without this information, any miscosting and mispricing of its services could cause Vineyard to lose business. Celeste divides Vineyard�s costs into four activity-based categories. a) Direct labor costs, 146,000. These costs can be directly traced to HT, 100,000, and ST, 46,000. b) equipment related costs (rent, maintenance, energy), 350,000. These costs are allocated to HT and ST on the basis of test-hours. c) setup costs, 430,000. These costs are allocated to HT and ST on the basis of the number of setup hours required. HT requires 13,600 setup-hours, and ST requires 3,600 setup-hours. d) costs of designing tests, 264,000. These costs are allocated to HT and ST on the basis of the time required for designing the tests. HT requires 3,000 hours and ST requires 1,400 hours. 1) classify each activity cost as output unit level, batch level, product or service sustaining, or facility sustaining and explain why? 2) calculate the cost per test hour for HT and ST. Explain briefly the reasons why these numbers differ from the $ 17 per test hour that Vineyard calculated using its simple costing system. 3) explain the accuracy of the product costs calculated using the simple costing system and the ABC system. How might Vineyards management yse the cost hierarchy and ABC information to better manage its business?

Match the items with the actions necessary to reconcile the bank statement.(there's not just one answer)1. interest credited in bank account2. fee charged by bank for returned check3. checks issued but not deposited4. deposits yet to be crediteda. add to bank statementb. deduct from bank statementc. add to personal statementd. deduct from personal statement

Russell's is considering purchasing $697,400 of equipment for a four-year project. the equipment falls in the five-year macrs class with annual percentages of .2, .32, .192, .1152, .1152, and .0576 for years 1 to 6, respectively. at the end of the project the equipment can be sold for an estimated $135,000. the required return is 13.2 percent and the tax rate is 23 percent. what is the amount of the aftertax salvage value of the equipment assuming no bonus depreciation is taken

Blue computers, a major pc manufacturer in the united states, currently has plants in kentucky and pennsylvania. the kentucky plant has a capacity of 1 million units a year and the pennsylvania plant has a capacity of 1.5 million units a year. the firm divides the united states into five markets: northeast, southeast, midwest, south, and west. each pc sells for $1,000. the firm anticipates a 50 perc~nt growth in demand (in each region) this year (after which demand will stabilize) and wants to build a plant with a capacity of 1.5 million units per year to accommodate the growth. potential sites being considered are in north carolina and california. currently the firm pays federal, state, and local taxes on the income from each plant. federal taxes are 20 percent of income, and all state and local taxes are 7 percent of income in each state. north carolina has offered to reduce taxes for the next 10 years from 7 percent to 2 percent. blue computers would like to take the tax break into consideration when planning its network. consider income over the next 10 years in your analysis. assume that all costs remain unchanged over the 10 years. use a discount factor of 0.1 for your analysis. annual fixed costs, production and shipping costs per unit, and current regional demand (before the 50 percent growth) are shown in table 5-13. (a) if blue computers sets an objective of minimizing total fixed and variable costs, where should they build the new plant? how should the network be structured? (b) if blue computers sets an objective of maximizing after-tax profits, where should they build the new plant? how should the network be structured? variable production and shipping cost ($/unit) annual fixed cost northeast southeast midwest south west (million$) kentucky 185 180 175 175 200 150 pennsylvania 170 190 180 200 220 200 n. carolina 180 180 185 185 215 150 california 220 220 195 195 175 150 demand ('000 units/month) 700 400 400 300 600