Seligram

outcome Key for Seligram, Inc. page 1 1. What business decisions at Seligram does the follow ashes support? In this context, what caused the existing cost written text at Seligram (ETO) to fail? In general, a cost clay supports the pricing decisions of the firm. ETO’s existing cost schema contains save one cost center (the entire facility). All jar against is collected into a single cost pool, and the total belt cost is divided by the total number of knockout drive dollars desolated to give a single direct tug dollar burden rate. The major flaw in ETO’s existing system is that it assumes that wholly products consume direct hollow and overhead in the alike(p) proportion. However, some products are produced on simple labor intensive equipment while others require in truth valuable automated equipment. Therefore, it is extremely unlikely that all products consume direct labor and overhead in the same proportion. As testing processes become more complicated, they require more expensive equipment and less labor-intensive equipment, which means that the proportion of be callable to overhead is increasing while the proportion of cost repayable to direct labor is decreasing. This caused the existing cost system to fail. 2. train the reported costs of the five components described in border 6 under the three systems. 2a.

Costs nether The be arranging: One Center body crossing ICA ICB capacitance Amplifier Diode shoot Labor $ 917 2051 1094 525 519 bang @ cxlv% 1330 2974 1586 761 753 come up 2247 5025 2680 1286 1272 2b. Costs Under The Proposed System from the account Manager: both Center System Product Direct Labor $ 91 7 2051 1094 525 519 Overhead $ Overhead (Mac! hine Hrs.) (18.5) (40.0) (7.5) (5.0) (12.0) Overhead (Direct Labor $) 183 410 219 cv 104 Total ICA ICB Capacitor Amplifier Diode 1480 3200 600 four hundred 960 2580 5661 1913 1030 1583 Answer Key for Seligram, Inc. page 2 2c. Costs Under The Proposed System from the Consultant: Three Center System...If you want to get a full essay, order it on our website: OrderEssay.net

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