--%>
Assignment Help - homework help

Planned product cost and the actual cost

A company has production facilities in several countries. Some of the products they sell are produced in stages (Raw Materials -> Pre-Assembly -> Assembly -> Finished Product) based on the technologies and materials involved (see Table 1).

Based on the exchange rate information provided below calculate the following:

1. The difference between the planned product cost and the actual cost?

2. What was the impact on Sales and Profit?

Table 1: Production Scenarios

Product

Pre-Assembly

Assembly

Country Sold In

Units Sold

 A

US

Mexico

Europe

150,000

 B

Mexico

US

China

600,000

 C

Canada

Japan

Korea

75,000

Table 2: Planned Costs and Revenue (per Unit in USD)

Product

Raw Materials

Pre Assembly

Assembly

Total cost of goods

Sale Price

Plan Gross Profit

A

$ 100USD

$ 250 USD

$ 50 USD

$ 400 USD

$ 900 USD

$ 500 USD

B

$ 150

$ 50

$ 175

$ 375

$ 675

$ 300

C

$ 75

$ 300

$ 250

$ 625

$ 1,200

$ 575

Table 3: Exchange Rates Applied at each stage (1 USD buys: X of Target Currency)

Table 3: Exchange Rates Applied at each stage (1 USD buys: X of Target Currency)

Currency

Raw Materials

Pre Assembly

Assembly

Cost of goods

Points of Sales

USD

 1:1

1.0000

1.0000

1.0000

1.0000

Yuan (China)

1:6,2190

6.2190

6.219

6.7400

6.2197

Peso

1: 12,586

12.992

13.035

13.456

13.409

Canadian Dollar

1:0.986

0.9830

0.9810

0.9999

1.1500

Yen

1: 89.995

90.000

89.999

89.132

90.750

Wou (Korea)

1, 057.8

1.058.1

1.058.5

1.058.8

1.060.0

Euro

1: 0.730

0.7820

0.8010

0.7530

0.7270

 

 

   Related Questions in Managerial Accounting

  • Q : Things which Weaknesses comprises Write

    Write a brief note on the things which Weaknesses comprises?

    		•
  • Q : Actual costing A function of measuring

    A function of measuring and assigning production costs to determine the unit cost. Actual revenue assigns the real cost of materials, labor, and overhead to ma

    		•
  • Q : Break-even point The operating level at

    The operating level at which the total sales revenue equals the total cost. Total sale revenue is equal to the price per unit times the number of units sold. Total cost equals total variable cost, the number of units sold in time the variable cost per unit and the tot

    		•
  • Q : Describe fluctuating capital of partners

    Describe fluctuating capital of partners? Answer: Partner‘s capital is stated to be fluctuating if capital modifies with every transaction in the capital accou

    		•
  • Q : Explain Cost Allocation Cost Allocation

    Cost Allocation: This is a technique of assigning costs to activities, outputs, or other cost objects. The allocation base employed to assign a cost to objects is not essentially the cause of the cost. For illustration, assigning the

    		•
  • Q : Define Inter-Entity Inter-Entity : A

    Inter-Entity: A term meaning between or among distinct federal reporting entities. It generally refers to the activities or costs among two or more agencies, bureaus or departments.

    		•
  • Q : Define Avoidable Cost Avoidable Cost :

    Avoidable Cost: The cost related with an activity which would not be acquired if the activity were not executed.

    		•
  • Q : The provision of management accounting

    explain how the provision of management accounting information can assist the management of a company with planning, controlling, decision making and communicating

    		•
  • Q : Benchmark test The process of testing a

    The process of testing a new software program using actual data and comparing the results to the alternative soft wares. The alternative can be new software or the organization's existing system. The test should be examined the software's accuracy and efficiency.

    		•
  • Q : Aging of Accounts What are Aging of

    What are Aging of Accounts? Briefly illustrate it.

    		•