SPSHT2_06 - 1 COST AND MANAGEMENT ACCOUNTING 2 ASSIGNMENT#2...

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COST AND MANAGEMENT ACCOUNTING 2 ASSIGNMENT # 2 - Cost Behavior and Related Linear Functions Gallant Mfg. Co. wishes to determine the linear cost formula for a number of its costs from historical data for the year ended June 30, 2005. The cost formulas will then be used for such practical purposes as budgeting. The controller wants you to do the cost formula calculations using two different methods, the hi-lo method, and linear regression. Because the template will be used for a number of different cost items, it should be generalized so that it can be used for different types of cost and different cost-driver units. In completing the assignment we will introduce or review several features of Excel: Sorting, use of, SLOPE, and INTERCEPT functions, relative and absolute referencing, using a sting for headings; Preparation of multiple graphs on an XY chart. The data below is for one of these costs called Processing and the period covers the last 12 months ended June 30, 2005. The related cost driver for this particular cost is Units produced . Use the current date as the report date. Cost Data (from Factory Ledger) Month Cost Driver units $ Cost Jul-04 4,500 $38,000 Aug-04 11,000 52.000 Sep-04 12,000 56,000 Oct-04 5,500 40.000 Nov-04 9,000 47,000 Dec-04 10,500 52,000 Jan-05 7,500 44,000 Feb-05 5,000 41,000 Mar-05 11,500 52,000 Apr-05 6,000 43,000 May-05 8,500 48,000 Jun-05 10,000 50,000 Required: Prepare a template that will generate cost formulas and a related chart using the sample data for Processing Costs for both the High/Low method and the Regression method. Input Section On Sheet 1 , prepare the input section with the following features: -a brief description telling the user the purpose of the template, preparation date, prepared by, and any instructions to assist the user in entering the input. -treat as separate input items the name of the cost, and the cost-driver units. enter only one date as input (such as the last day of the month of the first or last observation) and then generate all the month dates in the input schedule from this initial single date (using the date function) Continued on back……………………… Output Section The output section will consist of two additional sheets and three parts.
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