Ch11HWSolutionE11-3

Ch11HWSolutionE11-3 - CHAPTER 11 Strategic cost management...

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CHAPTER 11 Strategic cost management 11–3 1. Supplier cost: First, calculate the activity rates for assigning costs to suppliers: Inspecting components: $1,200,000/1,000 = $1,200 per sampling hour Expediting work: $960,000/100 = $9,600 per order Reworking products: $6,844,500/1,500 = $4,563 per rework hour Warranty work: $21,600,000/4,000 = $5,400 per warranty hour Next, calculate the cost per component by supplier: Supplier cost: Grayson Lambert Purchase cost: $144 × 200,000. ..................... $28,800,000 $129 × 800,000. ..................... $103,200,000 Inspecting components: $1,200 × 20. ........................... 24,000 $1,200 × 980. ......................... 1,176,000 Expediting work: $9,600 × 10. ........................... 96,000 $9,600 × 90. ........................... 864,000 Reworking products: $4,563 × 90. ........................... 410,670 $4,563 × 1,410. ...................... 6,433,830 Warranty work: $5,400 × 200. ......................... 1,080,000 $5,400 × 3,800. ...................... 20,520,000
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This note was uploaded on 02/08/2010 for the course ACTG 3000 taught by Professor C during the Spring '10 term at Oregon State.

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Ch11HWSolutionE11-3 - CHAPTER 11 Strategic cost management...

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