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Category > Accounting Posted 16 May 2017 My Price 5.00

Identify in the following scenarios whether the cost change

 

18.    LO.2 (Causes of cost changes; writing) Identify in the following scenarios whether the cost change is attributable to effects of cost behavior (CB), inflation/deflation (I/D), supplier cost adjustment (CA), or quantity purchased (QP). Defend your answer.

a.     Allison Mfg. experienced an increase in fuel costs following an increase in crude oil prices by members of OPEC.

b.    Foremost Plastics experienced an increase in the cost of plastic resins when its main supplier merged with one of its competitors.

c.     The amount Kimball Co. spent on raw materials declined when its sales volume dropped by 20 percent because of diminished overseas demand for its products.

d.    Minerva Industrial reduced the price it paid for fasteners when it consolidated the purchases made from five vendors to just one vendor.

e.     The price of corn syrup purchased by California Confectionary increased when the demand for corn-based ethanol jumped dramatically.

f.      The amount Madison Beef Processing expended for direct labor jumped 25 percent when demand for the company’s products jumped following the EU’s removal of its

U.S. beef import restrictions.

g.     The price Villanova Steel paid for its metal products increased when it adopted JIT manufacturing practices and began purchasing steel in small lot sizes.

h.    The cost of executive travel at Hudson Financial Services dropped by 20 percent when two new airlines began providing services at the airport nearest the firm’s headquarters.

 

 

 

 
 

Answers

Alpha Geek
(8)
Status NEW Posted 16 May 2017 07:05 AM My Price 5.00

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file 1494918989-Answer.docx preview (357 words )
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