Scribd Logo
Upload

Welcome to Scribd!

  • Craik Veneer

    Uploaded by

    brijmohanjakhmola
    540 views6 pages
    1. The document discusses the costs and revenues associated with different grades of 1/24 inch veneer. It provides details on the materials costs, labor costs, selling prices, revenues, profits, and percentage contributions of different grades. 2. It analyzes the costs and profits under both absorption costing and variable costing methods, and shows that variable costing provides a more accurate view of materials costs and margins. 3. It considers scenarios where the selling price and production of lower grade "backs" is changed, and a scenario where backs are treated as waste and sold for a lower price.

    Original Description:

    Copyright

    © Attribution Non-Commercial (BY-NC)

    Available Formats

    XLSX, PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    Report this Document
    1. The document discusses the costs and revenues associated with different grades of 1/24 inch veneer. It provides details on the materials costs, labor costs, selling prices, revenues, profits, and percentage contributions of different grades. 2. It analyzes the costs and profits under both absorption costing and variable costing methods, and shows that variable costing provides a more accurate view of materials costs and margins. 3. It considers scenarios where the selling price and production of lower grade "backs" is changed, and a scenario where backs are treated as waste and sold for a lower price.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as XLSX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    540 views6 pages

    Craik Veneer

    Uploaded by

    brijmohanjakhmola
    1. The document discusses the costs and revenues associated with different grades of 1/24 inch veneer. It provides details on the materials costs, labor costs, selling prices, revenues, profits, and percentage contributions of different grades. 2. It analyzes the costs and profits under both absorption costing and variable costing methods, and shows that variable costing provides a more accurate view of materials costs and margins. 3. It considers scenarios where the selling price and production of lower grade "backs" is changed, and a scenario where backs are treated as waste and sold for a lower price.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as XLSX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    of 6

    Grades Selling Price 1/24 inch veneer in feet sales revenue per 1,00 feet Net Value Percent

    of total Cost Applicable to each per 1000 Materials cost per thousand feet Labor and FOH Selling cost (ave.) feet $ $ $ $ $ $

    Faces 88.00 9,000 88.00 792.00 81.48% 358.52 39.84

    Backs 25.00 9,000 20.00 180.00 18.52% 81.48 9.05

    Standard (Absorption Costing) per 1000 sqft Selling price Direct Materials Labor & FOH Operating cost ( clipping, lath, heating) $ other costs ( recliping, drying) Selling cost Total Cost Gross Profit Variable Costing per 1000 sqft Selling price Direct Materials FOH Operating cost ( clipping, lath, heating) other costs ( recliping, drying) Cost of Goods Manufactured Selling cost Gross Margin

    88 12.22 10.125 2 24.35 63.66

    20 12.22 10.125 3.75 2 28.10 (8.10)

    88 39.84 16.5 56.34 3.26 28.41

    20 9.05 3.75 3.75 16.55 0.74 2.71

    1. It is better to value materials cost using variable costing. Variable costing shows a more a

    Total

    18,000 - per 1,000 boardfeet cut; can process up to 12,000 brdft in 8 hours shift 108 972 1 440

    24 4

    24.44 - graded 50-50 20.25 - joint cost; i will divide them to 50-50 based on feet produced - done on back separately although on the same machine

    20.25

    - since i dont have measurement of backs per 1000 sqft, il make use of value

    riable costing shows a more accurate cost of materials used on the product.

    a. Change in price of backs Grades Selling Price 1/24 inch veneer in feet sales revenue per 1,00 feet Net Value Percent of total Cost Applicable to each per 1000 Materials cost per thousand feet Labor and FOH Selling cost (ave.) feet $ $ $ $ $ $

    Faces 88.00 9,000 88.00 792.00 81.5% 366.67 40.74

    Backs 22.00 9,000 20.00 180.00 18.5% 83.33 9.26

    Standard (Absorption Costing) per 1000 sqft Selling price Direct Materials Labor & FOH Operating cost ( clipping, lath, heating) $ other costs ( recliping, drying) Selling cost Total Cost Gross Profit Variable Costing per 1000 sqft Selling price Direct Materials FOH Operating cost ( clipping, lath, heating) other costs ( recliping, drying) Cost of Goods Manufactured Selling cost Gross Margin

    88 12.22 10.125 2 24.35 63.66

    22 12.22 10.125 3.75 2 28.10 (6.10)

    88 40.74 16.5 57.24 3.26 27.50

    22 9.26 3.75 3.75 16.76 0.74 4.50

    b. Change in production of backs Grades Selling Price 1/24 inch veneer in feet sales revenue per 1,00 feet Net Value Percent of total Cost Applicable to each per 1000 feet $ $ $

    Faces 88.00 10,000 88.00 792.00 81.48% 366.67

    Backs 20.00 8,000 20.00 180.00 18.52% 83.33

    Materials cost per thousand feet Labor and FOH Selling cost (ave.)

    $ $ $

    36.67

    10.42

    Standard (Absorption Costing) per 1000 sqft Selling price Direct Materials Labor & FOH Operating cost ( clipping, lath, heating) $ other costs ( recliping, drying) Selling cost Total Cost Gross Profit Variable Costing per 1000 sqft Selling price Direct Materials FOH Operating cost ( clipping, lath, heating) other costs ( recliping, drying) Cost of Goods Manufactured Selling cost Gross Margin

    88 12.22 10.125 2 24.35 63.66

    20 12.22 10.125 3.75 2 28.10 (8.10)

    88 36.67 16.5 53.17 3.26 31.57

    20 10.42 3.75 3.75 17.92 0.74 1.34

    c. Backs treated as waste (@ 440) Selling price Raw Materials Less: Wastage selling price - cost incurred after split off Labor and Factory overhead Selling cost savings from backs total cost of good manufactured Gross Margin c. Backs treated as waste (@ 450, selling @ 22) Selling price Raw Materials Less: Wastage selling price - cost incurred after split off Labor and Factory overhead Selling cost savings from backs total cost of good manufactured Gross Margin

    24.00 20.00 3.75 16.25

    25.00 22.00 3.75 18.25

    Total

    18,000 - per 1,000 boardfeet cut; can process up to 12,000 brdft in 8 hours shift 108 972 100% 450

    24 4

    24.44 - graded 50-50 20.25 - joint cost; i will divide them to 50-50 based on feet produced - done on back separately although on the same machine

    20.25

    - since i dont have measurement of backs per 1000 sqft, il make use of value

    Total

    18,000 108 972 1 450

    24 4

    24.44 20.25

    20.25

    88.00

    7.75 24.00 4.00 5.00 40.75 47.25

    88.00

    6.75 24.00 4.00 5.00 39.75 48.25

    You might also like