Glister Company

Glister Company - net income. Part E Apparently as the cost...

Info iconThis preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
Part A D.M 20000 D.L Dept  1 30000 D.L Dept  2 6000 FOH  33333 Total cost 89333 Per unit  $       8.93  Overhead  rate 13.33 Part B D.M 20000 D.L Dept  1 30000 D.L Dept  2 6000 FOH  Plant wide 4333 FOH  Dept1 1000 FOH Dept  2 12000 Total cost 73333 Per unit  $       7.33  Overhead  rate Plant wide 3.33 Dept 1 10 Dept 2 10 Part C i 17.33 ii 9.53
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
The difference in the bid price is due to difference in allocation method.  However, the more logical is the $9.53 as the allocation has been made based on the resources to be consumed for each activity.  It will also help  in  winning the bid  due to  lower bid  price. Part D Plant wide Dept 1 Dept 2 Total Actual 190000 110000 520000 820000 applied  208333 105000 520000 833333 Under or  over 18333 -5000 0 13333 over under over Total is over applied FOH by 13333, if it is charged to cost of goods sold but not to inventories it will increase the
Background image of page 2
Background image of page 3
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: net income. Part E Apparently as the cost is lower than $8 offered, it is suggested that the company should produce itself. Part F Additional cost 6700 less increment al profit 15000 Increase in net income 8300 The company can accept the offer of contractor as it will increase the profit by $8300. Part G The issues are the transportation cost, any other cost for import of goods, the lead time of delivery of goods and change in foreign exchange rate to be considered while importing from another country....
View Full Document

This note was uploaded on 03/23/2012 for the course ACCT 306 taught by Professor Mikewoodard during the Spring '12 term at DeVry Houston.

Page1 / 3

Glister Company - net income. Part E Apparently as the cost...

This preview shows document pages 1 - 3. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online