Questions from Cost Management

Q: Dantrell Palmer has just been appointed manager of Kirchner Glass Products Division

Dantrell Palmer has just been appointed manager of Kirchner Glass Products Division. He has two years to make the division profitable. If the division is still showing a loss after two years, it will...

Q: Alydar, Inc., manufactures and sells automotive tools through three divisions

Alydar, Inc., manufactures and sells automotive tools through three divisions: Eastern, Southern, and International. Each division is evaluated as a profit center. Data for each division for last year...

Q: Porter Insurance Company has three lines of insurance: automobile, property

Porter Insurance Company has three lines of insurance: automobile, property, and life. The life insurance segment has been losing money for the past five quarters, and Leah Harper, Porter’s controller...

Q: Fred Morton has just purchased a life insurance policy from Porter with

Fred Morton has just purchased a life insurance policy from Porter with premiums equal to $1,500 per year. Required: 1. Assume Fred holds the policy for one year and then drops it. What is his contrib...

Q: Olin Company manufactures and distributes carpentry tools. Production of the tools

Olin Company manufactures and distributes carpentry tools. Production of the tools is in the mature portion of the product life cycle. Olin has a sales force of 20. Salespeople are paid a commission o...

Q: Shannon, Inc., has two divisions. One produces and sells

Shannon, Inc., has two divisions. One produces and sells paper party supplies (napkins, paper plates, invitations); the other produces and sells cookware. A segmented income statement for the most rec...

Q: Pittsburgh-Walsh Company (PWC) is a manufacturing company whose

Pittsburgh-Walsh Company (PWC) is a manufacturing company whose product line consists of lighting fixtures and electronic timing devices. The Lighting Fixtures Division assembles units for the upscale...

Q: Heaps Company produces jewelry that requires electroplating with gold, silver,

Heaps Company produces jewelry that requires electroplating with gold, silver, and other valuable metals. Electroplating uses large amounts of water and chemicals, producing wastewater with a number o...

Q: Play-Disc makes Frisbee-type plastic discs. Each 12

Play-Disc makes Frisbee-type plastic discs. Each 12-inch diameter plastic disc has the following manufacturing costs: Direct materials $1.67 Direct labor 0.56 Variable overhead 0.72 Fixed overhead 1.8...

Q: Sweeney Manufacturing has a plant where the equipment is essentially worn out

Sweeney Manufacturing has a plant where the equipment is essentially worn out. The equipment must be replaced, and Sweeney is considering two competing investment alternatives. The first alternative w...