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craik veneer - Craik Veneer Case LT:9A Problem Definition...

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Craik Veneer Case – LT:9A Problem Definition: Should Craik Veneer Company accept Groton Company's offer to of $20 per thousand feet of 1/24 -inch backs? In order to find if the order has to be accepted or not, we have to evaluate Groton Company's offer using both the production manager's and the sales manager's methods of allocating costs. 1. Production Manager's Method of Cost Allocation Weight Method 2. Sales Manager's Method of Cost Allocation. Sales Value Method By-Product Costing Method Analysis for 1 Cost and Other Information Craik Veneer is able to produce 18,000 surface feet of 1/24-inch veneer per 1,000 board feet cut which produces an average of 50% faces and 50% backs Labor and factory overhead costs together averaged $24 per thousand surface feet of veneer. Labor and factory overhead costs through clipping averaged $20.25 per 1,000 surface feet of veneer and those for drying and later operations averaged $3.75 Selling costs averaged $4.
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