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Cornerstones of Cost Accounting 1st Edition by Don Hansen,Maryanne Mowen
Edition 1ISBN: 978-0538736787Cornerstones of Cost Accounting 1st Edition by Don Hansen,Maryanne Mowen
Edition 1ISBN: 978-0538736787 Exercise 25
LONG-TERM PERFORMANCE REPORT
Kimmering Company had actual quality costs for the year ended June 30, 2011, as given below.
At the zero-defect state, Kimmering expects to spend $150,000 on quality engineering, $30,000 on vendor certification, and $20,000 on packaging inspection. Assume sales to be $10,000,000.
Required:
1. Prepare a long-range performance report for 2011. What does this report tell the management of Kimmering?
2. Explain why quality costs still are present for the zero-defect state.
3. What if Kimmering achieves the zero-defect state reflected in the report? What are some of the implications of this achievement?
Kimmering Company had actual quality costs for the year ended June 30, 2011, as given below.
At the zero-defect state, Kimmering expects to spend $150,000 on quality engineering, $30,000 on vendor certification, and $20,000 on packaging inspection. Assume sales to be $10,000,000.
Required:
1. Prepare a long-range performance report for 2011. What does this report tell the management of Kimmering?
2. Explain why quality costs still are present for the zero-defect state.
3. What if Kimmering achieves the zero-defect state reflected in the report? What are some of the implications of this achievement?
Explanation
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1. Long range performance report of Kimm...
Cornerstones of Cost Accounting 1st Edition by Don Hansen,Maryanne Mowen
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