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Test Bank for Fundamentals of Cost Accounting, 7th Edition by (Lanen/ Anderson/ Maher), ISBN: 9781264100842, All 18 Chapters Covered, Verified Latest Edition$16.99
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Test Bank for Fundamentals of Cost Accounting, 7th Edition by (Lanen/ Anderson/ Maher), ISBN: 9781264100842, All 18 Chapters Covered, Verified Latest Edition
Test Bank for Fundamentals of Cost Accounting, 7th Edition by (Lanen/ Anderson/ Maher), ISBN: 9781264100842, All 18 Chapters Covered, Verified Latest Edition Test Bank for Fundamentals of Cost Accounting, 7th Edition by (Lanen/ Anderson/ Maher), ISBN: 9781264100842, All 18 Chapters Covered, Verifie...
Chapter Eighteen: Performance Measurement to Support Business Strategy
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Answers at the end of each chapter ui ui ui ui ui ui
1) Carley Incorporated incurs many types of costs in its operations. Place the number
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of the appropriate stage in the value chain in Column 2 in the blank next to each cost in Co
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lumn 1. ui
Cost Stage in the Value Chain
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Transportation costs to ship vans to customer ui ui ui ui ui ui 1. Customer Service ui
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Labor costs for factory workers ui ui ui ui 2. Distribution
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Overtime costs for scientists working on new engin ui ui ui ui ui ui ui 3. Research& D u
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e technology
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Utilities cost for the design testing center ui ui ui ui ui ui 4. Marketing
Costs to survey customers about their satisfaction
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5. Production
Costs to sponsor a sporting event ui ui ui ui ui 6. Design ui
2) SuperMax is an integrated provider of genetically engineered corn. Many types of ui ui ui ui ui ui ui ui ui ui ui ui
costs are incurred in its operations. Place the number of the appropriate stage in the valu
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e chain in Column 2 in the blank next to each cost in Column 1.
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Cost Stage in the Value ui ui ui
Chain
Warehouse costs to store seed awaiting shipme ui ui ui ui ui ui 1. Customer Service ui
nt to customers
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Utility costs for seed mill ui ui ui ui 2. Distribution
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Equipment costs in genetics laboratory ui ui ui ui 3. Research &
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Development
Labor costs to staff help-line call center 4. Marketing
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Costs to prepare advertising campaign in national a
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griculture magazine ui
Costs to contract with growers to provide seed
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, 3) Travon's Limo Service provides transportation services in and around Bentonville.
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Its profits have been declining, and management is planning to add a package delivery se
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rvice that is expected to increase revenue by $275,000 per year. The total cost to lease ad
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ditional delivery vehicles from the local dealer is $60,000 per year. The present manager
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will continue to supervise all services. However, labor and utilities costs will increase by 40
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% and rent and other costs will increase by 15% when the package delivery service is add
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ed.
Travon’s Limo Service Annu ui ui ui
al Income Statement ui ui
Before Expansion
Sales Revenue ui $ 960,000 ui
Costs:
Vehicle Leases ui $ 400,000
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Labor 290,000
Utilities 50,000
Rent 100,000
Other Costs ui 60,000
Manager’s Salary ui 120,000
Total Costs ui 1,020,000
Operating Profit (Loss) ui ui $ (60,000)ui
a. Prepare a report of the differential costs and revenues if the delivery service is added.
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b. Should management start up the delivery service? Explain your answer.
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