Company X has two main

departments – A and B - and two support departments - HR and Maintenance. The

company allocates support department costs in both departments using headcount

as a basis for allocation, as per the following data:

In their first year of operations, Company X completed 100000 units

costing $600000, before spoilage allocation.

The following information is available for the same period:

• 50000 units were sold
• 10000 units were 50% complete at the end of the year, at a cost of $80000

• all units are inspected at the end of the production process
• normal spoilage rate is 3.00%
• normal spoilage cost incurred was $17345
• abnormal spoilage cost incurred was $42998

Compute the portion of total spoilage costs that should be charged

against revenue in the period under analysis.

• Budgeted manufacturing costs = $67311
• Actual manufacturing costs = $60579,9

Company X is in the process of deciding whether to maintain or discontinue brand A. The following information refers to Brand A:

• Contribution margin = $61276

• Avoidable fixed costs = $55148,4

• Non-avoidable fixed costs = $49020,8

Company X should ___________

Company X sells two products – A and B - and also a bundled version of both. The

company allocates common costs and revenues using the stand-alone method. The total revenue for the bundle in the last period was $24000 The following data is available concerning selling prices:

• Product A sells for $10/unit; 10000 units
• Product B sells for $15/unit; 20000 units
• The bundle sells for $20/unit

The amount of the bundle revenue allocated to product A is ________:

Company X uses the FIFO method and has two departments, Department 1 and Department 2. The following information is available for Department 1, that

is the

first stage of the manufacturing process of the company. Direct materials are added when the process is 20% complete and conversion costs are added homogeneously in the process.

• BWIP for this department was 80%

  complete in what concerns conversion costs

• EWIP was 58% complete

How much of the conversion costs were assigned to the EWIP units, assuming no spoilage?

Indicate whether the following sentences are TRUE or FALSE:

Company X is analysing the purchase of new industrial equipment that will replace an old equipment.

Which one of the following is relevant to the manufacturing equipment replacement decision?