Exercise 9-26: Degree of Operating Leverage (DOL)
% of Sales
% of Sales
Exercise 10-24: Production and Materials Purchases Budgets
White Corporation's budget calls for the following sales for next year:
Each unit of the prod
Questions 14-1 through 14-12
14-1: What is the difference between a master budget, pro-forma budgets, and a flexible budget?
14-1: A master budget represents forecasted operating profit based on a single output level (planned sales) for an
Solution (15 min)
Current Profit per unit
New target cost (to meet competitve price)
2. The target cost can probably be achieved by efforts in two areas:
a. The analysis of budgeted versus actual cost shows an unfa
1. Assuming Martens plans to meet the expected demand for 20,000 attic fans, how many should it manufacture and how many should it
purchase from Harris Products? Explain your reasoning with calculations.
2. Idenpendent of Part 1 above, assume that Beth Jo
Question 3-1 through 3-20
31 What is the difference between cost allocation and cost assignment?
3-1 Cost assignment refers to the general case of assigning costs to cost
pools or cost objects. When there is a direct and traceable link
between the cost an
11 Give four examples of firms you believe would be significant users of cost
management information and explain why.
Firms Using Cost Management. Here are some examples; there are
many possible answers.
1. Wal-Mart: to keep costs low by streamlining