Mid-Term Managerial Accounting
a.) Snack-Foods division president may want to play the end-of-year games because there may be a bonus for the division president if they get certain earnings for the year. Not only a bonus for the division president; but there may be a bonus for the division itself. With that being said he could use that for the other employees to help participate in the year-end games. If corporate has seen them fallen behind, then these year-end games maybe able to apply to job security or even promotions.
b.) Each year-end games
• Acceptable- If they plan to have it maintained until January of the following year there would be no work shown and they would not need to put a transaction regarding the …show more content…
An example of a true variable cost can be your total for a long distance cell phone bill and then based off the minutes you talk. Step variable costs (total cost changes), your total remains constant within a narrow range of activity, and then your total cost will increase to a higher cost for the next higher range of activity. An example of this will be a maintenance cost such as the more you use it the more you will need to repair the item (maintain it). A mixed cost has both a fixed and variable components; an example of this is a utility cost.
c.) The concept of relevant range applies to both fixed and variable cost because fixed costs changes based if the anticipated level of activity changes, along with the costs that support the operations may also change. They are also plotted up and down in large steps within a graph, rather than being fixed at one level of all ranges of activity. Variable cost applies to the relevant range by the costs that are constant per unit of the activity, which is only applicable within the relevant ranges. Whichever variable cost you work with you have to know if the cost is within the relevant range of activity.
5.) a.) Journal entries for the transactions for items i.-x for the following year.
i. Raw Materials 301,000
ii. Work in Process 273,000
Factory Overhead 19,000 Raw Materials 292,000
iii. Work in Process 296,000
Factory Overhead 81,000