...1. ABC revised product costs for 4 pens: Indirect labor (3 activities) ($20,000) a. .50 scheduling/ handling production runs= b. .40 physical changeover= c. .10 maintain records on 4 products Operate. Computer systems: ($10,000) a. .80 included in production run activity b. .20 keep records on 4 products Machines ($14000) a. Machine depreciation b. Machine maintenance c. Energy to operate machines Direct labor= 20,000+8000 (fringe benefits) = 28000 Indirect labor= 20,000+8000 (fringe) =28000 See Excel file for product costs calculations and new profit margins Comparing two profit margins Traditional vs. ABC Blue Black Red Purple Total Traditional 13.6% 13.3% 14.8% 18.2% 13.5% Profit Margin ABC 21.6% 22.67% -44% -200% 14% 2. Looking at the new product costs per unit (using ABC) the cost per unit for each product is much different then found under traditional. The cost per unit found under the ABC method was different than what the unit price for each product was being sold for. For blue and black pens the company was making a profit on each pen there were selling (comparing $1.18 product cost for blue and $1.16 for black which were each being sold for 1.50). Red pens cost $2.23 each to make and were being sold for 1.55 each which resulted in a loss. Purple pens were losing the company even more money with costing 4.95 to produce but were only being sold for 1.65 per pen. Under further calculations using the ABC method it was found that blue was the...
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...CLASSIC PEN COMPANY - DEVELOPING ABC MODEL Sourav Baliarsingh MIB -118083 ANALYSIS Classic Pen Company’s Return on Sales decreased significantly after it expanded its product line to include red and purple pens. Two alternatives exist: 1) Stop making red and purple pens 2) Increase the price of red and purple pens Prior to adding red and purple pens to its lineup, Classic Pen’s Return on Sales was approximately 22%. However, producing the new colors has caused many time consuming changeovers, increasing production costs and decreasing the Profit Margin. Comprehensive Return on Sales has fallen from 22% to 13.5% (Exhibit 1). Blue and black pens are still generating a 21.6% and 22.6% return, while red and purple pens are operating at a loss, reducing both Net Income and Return on Sales. Classic Pen Company could easily restore its Profit Margin to 22% if it stopped making red and purple pens. Currently, red and purple pens are causing Classic Pen Company to lose money. If the company wants to continue to produce red and purple pens, it should increase the selling price of these colors, so the Return on Sales is equal to, if not greater than, that of the blue and black pens. However, Classic Pen Company should not continue to produce these additional colors at a loss, decreasing its Net Income and comprehensive Return on Sales. Classic Pen Company should immediately cease production on red and purple pens. It should continue to produce blue and black pens, but should...
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...The problem of this case is that, as in the financial report for the most fiscal recent year, the overall profitability of Classic Pen company goes down despite of the introducing of its new two products, RED and PURPLE pens, which show more profitable than the traditional BLUE and BLACK product. These two new products are expected to be sold at premium selling prices about 3% and 10% respectively in the order and the new line, particularly PURPLE, in fact, showed much higher margin over the others. The problem was addressed is that the production technology required for the RED and the PURPLE pens demand specifications. Especially, making the RED color needs more changeovers, which leads to waste lots of time on purchasing and scheduling and management activities as well as money. In order to come up with a management decision under this situation, the controller is considering of using the activity-based costing (ACB) system to create the financial statement instead of using the traditional, job order costing system. Unlike the job order costing which maintains records and allocate cost on top of direct labor, ABC focuses on activities. Therefore, it leads more cost pools to be used to assign overhead costs to products. Four cost drivers which directly related to activity cost pools to assign overhead costs could be used for this case. As a result, costs are assigned more directly on the basis of the cost drivers used to produce each product. II. Strengths, Weaknesses,...
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...CASE ANALYSIS: CLASSIC PEN COMPANY The Classic Pen Company, initially a low cost producer of blue and black ink pens, decided to expand its product line by introducing red and purple pens into the market. Utilizing the same machinery and technology, the company produced red pens at a three percent premium and purple pens at a ten percent premium. The transition to the increased production requirements have not been fluid and the profitability of the company is not at the level management previously envisioned. The controller reviewed the most recent financial reports for Classic Pen Company and is disappointed with the results. Prior to production of the red and purple pens, total indirect costs were less than direct labor costs. All indirect costs were accumulated at the factory level and assigned to products based on direct labor costs. Prior to the introduction of the red and purple pens, the overhead rate was two hundred percent of direct labor costs. After the production of the red and purple pens, the overhead rate was three hundred percent of direct labor costs. The profit margin of Classic Pen Company decreased from twenty percent to 13.5 percent. The cost system used by Classic Pen Company has historically allocated overhead costs on the basis of direct labor costs. The current financial data has led the controller to question the current overhead cost structure. Their current costing system reports identical overhead percentages for the black, blue...
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...CLASSIC PEN COMPANY: DEVELOPING AN ABC MODEL REVISED PRODUCT COSTS FOR THE FOUR PENS, BASED ON THE ACTIVITY INFORMATION COLLECTED BY DEMPSEY Cost centres under ABC Indirect labour=$ 20,000 40% *20,000=8,000 Total indirect labour=$ 28,000 Computer expenses=$ 10,000 Machine expenses= $ 8,000+ $ 4,000+ $ 2,000=$ 14,000 Cost estimates/allocation under ABC Activity | Indirect labour | Computer expenses | Machine expenses | Total | Activity rate | Handle production runs | 50% | 14,000 | 80% | 8,000 | | | 22,000 | 150 | 146.7 | Set up time | 40% | 11,200 | | | | | 11,200 | 526 | 21.29 | Parts administration | 10% | 2,800 | 20% | 2,000 | | | 4,800 | 4 | 1200 | Machine support | | | | | 100% | 14,000 | 14,000 | 1000 | 1.4 | Total | | 28,000 | | 10,000 | | 14,000 | 52,000 | | | | | | | | | | | | | Resource costs to activities (ABC cost sheet | Blue | Black | Red | Purple | Total | | 50,000 | 40,000 | 9,000 | 1,000 | 100,000 | Direct material | 25,000 | 20,000 | 4,680 | 550 | 50,230 | Direct labour | 10,000 | 8,000 | 1,800 | 200 | 20,000 | 40% of fringe benefits | 4,000 | 3,200 | 720 | 80 | 8,000 | Overheads | | | | | | Machine support | 7,000 | 5,600 | 1,260 | 140 | 1,4000 | Production run expenses | 7,333 | 7,333 | 5,573 | 1,760 | 22,000 | Set up expenses |...
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...Classical Mythology Part I Professor Elizabeth Vandiver THE TEACHING COMPANY ® Elizabeth Vandiver, Ph.D. Visiting Assistant Professor of Classics, University of Maryland Elizabeth Vandiver did her undergraduate work at Shimer College, Mt. Carroll, Illinois, where she matriculated in 1972 as a sixteen-year-old “early entrant.” After receiving her B.A. in 1975, she spent several years working as a librarian before deciding to pursue graduate work in Classics at the University of Texas at Austin. She received her M.A. in 1984 and her Ph.D. in 1990. In addition to teaching at the University of Maryland, Professor Vandiver has held visiting professorships at Northwestern University, where she taught from 1996 to 1999; the University of Georgia; The Intercollegiate Center for Classical Studies in Rome, Italy; Loyola University, New Orleans; and Utah State University. Her course on Classical Mythology has been particularly successful. In 1998, Dr. Vandiver received the American Philological Association’s Excellence in Teaching Award, the most prestigious teaching award available to American classicists. Other awards include the Northwestern University Department of Classics Excellence in Teaching award for 1998 and the University of Georgia’s Outstanding Honors Professor award in 1993 and 1994. Dr. Vandiver has published a book, Heroes in Herodotus: The Interaction of Myth and History, and several articles, as well as delivering numerous papers at national and international...
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...Business School 9-198-117 Rev. September 17, 1998 Classic Pen Company: Developing an ABC Model The Classic Pen Company Case Jane Dempsey, controller of the Classic Pen Company, was concerned about the recent financial trends in operating results. Classic Pen had been the low-cost producer of traditional BLUE pens and BLACK pens. Profit margins were over 20% of sales. Several years earlier Dennis Selmor, the sales manager, had seen opportunities to expand the business by extending the product line into new products that offered premium selling prices over traditional BLUE and BLACK pens. Five years earlier RED pens had been introduced, which required the same basic production technology but could be sold at a 3% premium. And last year PURPLE pens had been introduced because of the 10% premium in selling price they could command. But Dempsey had just seen the financial results (see Exhibit 1) for the most recent fiscal year and was keenly disappointed. The new RED and PURPLE pens do seen more profitable than our BLUE and BLACK pens, but overall profitability is down and even the new products are not earning the margins we used to see from our traditional products. Perhaps this is the tougher global competition I have been reading about. At least the new line, particularly PURPLE pens, is showing much higher margins. Perhaps we should follow Dennis’ advice and introduce even more specialty colored pens. Dennis claims that consumers are willing to pay higher...
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...CS113: Academic Strategies for the Business Professional Unit 6 Academic Writing Assignment Full Name: Heather Taylor Two-digit Section #: 06 Instructions: Download this document to your computer before filling it out. Save using “Save As” and add your name to the front removing the phrase “YourName” All of the gray boxes below should be appropriately filled in and the document saved again before submitting to the Unit 6 Dropbox. Paragraph Writing Paragraph #1: Purpose: Describe Write a complete paragraph about a person who has influenced you in positive ways. Do not write more than 1 paragraph for this topic. Focus on at least one way in which this person has made an important impact upon you. Use specific ideas and examples to illustrate your points and make sure to refer to the Paragraph Structure Chart located at the end of the Unit 6 Reading. Include a topic sentence, supporting details and a conclusion (minimum 10 complete sentences). My pastor has been a big influence. He has influenced me in many positive ways. He is a role model for me to follow. He is always trying to brighten up a person’s day. He often visits people in the hospital. This gives them a reason to smile. He does food drives for many organizations. He collects food for Book Bags of Hope. He volunteers and gives out food to the less fortunate. He is a person that has a big impact on many lives. Paragraph #2: Purpose: Share an Opinion Write...
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...Any man who keeps working is not a failure. He may not be a great writer, but if he applies the old-fashioned virtues of hard, constant labor, he’ll eventually make some kind of career for himself as writer. This reminds of Haley Diaz, a young, but expressive author of her own works inside of a first grade classroom. She has the smarts, and the ability to reel you in with the words she applies with the use of pen and paper. Haley knows how to construct her papers from start to finish using conventions provided by her teacher. She connects you with imaginative thinking, real life events, and things she has seen. Her use of imagery, English-Language Arts conventions, and detailed illustrations will leave you in awe, and with a big smile. When reading through the first grader’s writing named Haley Diaz, the literary element imagery comes to mind. She allows for you to go with her on her journey from being an amateur writer to an advanced writer. She paints this picture of herself, the things she likes, her family, and what’s most important to her. She captures every single detail, unless it’s something that she doesn’t care about. She pays very close attention to detail to everyday life events, and replicates it in her storytelling. Her illustrations are vivid and provide us with much detail of things that have occurred regardless of the interest level. I see a developing learner with plenty of potential when I read the words she writes on such thick lined paper. This is a learner...
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...Paper Chromatography Purose- the purpose is you will use paper chromatography to separate colors from ink. If the ink is soluble in water, it will travel up the paper with the water. Solubility is related to the type of intermolecular forces between the substances; substances with similar IMF’s will be soluble. As the solvent rises on the paper and evaporates, it leaves the colors in its path. Background info- I know that water is a polar solvent and that rubbing alcohol is a nonpolar solvent. Materials- 1. Chromatorgraphy paper 2. 2 Petri Dishes 3. Black felt tips pens 4. Water 5. Felt tip pens of other colors 6. Alcohol Procedure- 1. Obtain two pieces of chromatography paper. Trace a quarter in pencil, in the center of the paper 2. Poke a small hole in the center of the circle 3. Select 3 felt tip pens of different colors (one must be black). Make one dot with each en on each piece of chromatography paper along the line traced around the center, as illustrated on the board. 4. Use a pencil to label these dots with the color and “FT” for felt tip. 5. Select 3 permanent makers of different color (one must be Black). Make one dot with each marker on each piece of chromatography paper along the line traced around the center, as illustrated on the board. 6. Use pencil to label these dots with the color and “P” for permanent. 7. Remove the papers from the solvents when the solvent has moved to within 2 cm of the edge of the paper....
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...this week: $1.00 For going to the store for you: $.50 Baby-sitting my kid brother while you went shopping: $.25 Taking out the garbage: $1.00 For getting a good report card: $5.00 For cleaning up and raking the yard: $2.00 Total owed: $14.75 Well, his mother looked at him standing there, and the boy could see the memories flashing through her mind. She picked up the pen, turned over the paper he’d written on, and this is what she wrote: For the nine months I carried you while you were growing inside me: No Charge For all the nights that I’ve sat up with you, doctored and prayed for you: No Charge For all the trying times, and all the tears that you’ve caused through the years: No Charge For all the nights that were filled with dread, and for the worries I knew were ahead: No Charge For the toys, food, clothes, and even wiping your nose: No Charge Son, when you add it up, the cost of my love is: No Charge. When the boy finished reading what his mother had written, there were big tears in his eyes, and he looked straight at his mother and said, “Mom, I sure do love you.” And then he took the pen and in great big letters he wrote: “PAID IN...
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...unhappy. My boyfriend and I broke up the night before my last exam. I would talk to my friends about it but I felt like it became too much for them. I knew they wanted to make me happy so they would listen but I didn’t feel right about putting them through it so I started writing. Whenever I needed a break from everyone around me, I would grab a piece of paper and a pen and just start pouring my thoughts onto paper. It was usually about how I was going through a tough time, which now seems increasingly petty, but at that time paper was my confidant. I wrote everything, even if it was a paragraph, or even barely a line. I used to transfer all the bad thoughts in my mind onto paper and just leave it there. I substituted my friends for paper. Paper wouldn’t talk back or tell me that it wasn’t god for me. It would just listen, absorb, and always be there. And that’s when I fell in love with writing. This is when writing became a habit. When I got over irrelevant boyfriend issues, I still had that craving to write something, anything, so I started writing about my day. If I had had a bad day, I would sit with my book and pen and just write till I overcame the bad thoughts. Those rare but sweet moments when I would go into a stream of consciousness showed me glimpses of certain peculiarities I didn’t even know I possessed. Sometimes I would re read things that I had written previously and I would be able to feel what I had felt when I was writing those words. All those memories would...
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...You almost have to be of a certain age these days to remember what it was like to sit down and write out a letter or to even have had to handwrite it. A handwritten or typed letter takes time, creativity and thought., which is why people prefer to text, email, or just jot down a short note, etc. There are times when all you want to say is "meet me at 8" and then a text or a short note is perfect. The problem comes only when you are required to put together a proposal letter for a business, a cover letter for an open job position or even when you want to journal some things so that you read it at a later date. It is with those opportunities that we find our skills have been reduced to LOL, k, brb, tc, cya. Letter writing is important as it reveals something about your personality that a machine can't. Your style of handwriting, choice of ink and paper all say something about you as an individual. Now almost everyone has become too busy so there is no time for anyone to put their words in thoughts. Writing love letters is no longer interesting to people. Lot of new technology has replaced the beauty of writing love letter. Sending email, messages, SMS has become the trend now. But when you express your love, the best way is to write a letter to your beloved one. And when you start writing your thoughts there are no limitations to convey what we think. The quantity and quality of contemporary written communication is fast flowing down the tubes of mindless entertainment devices...
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...this poem, Morning is a new sheet paper for you to write on -the poet is comparing the day with a sheet of paper and your action with a pen without an eraser. Every word on this paper represents something priceless. Each sunrise symbolizes a new sheet of paper or a new day. The pencil that writes on this piece of paper can only relate to your action. It cannot erase or rewrite what was noted down. Whatever you want to say, all day, until the night folds up and flies away- May your words have a solid foundation that will bring joy and happiness to oneself. Every sentence that contains my words shouldn’t offend anyone but should bring joy and satisfaction to my fellow being. A sheet of paper completes when sunset appears, and no line can repeat itself because once it is gone it can’t return again. The bright words and the dark words are gone-May this pen always be exposed to light in order to continue to write the glory of positivity, and to never encounter darkness where all lines will disappear. Until dawn and a new day to write on-The light are fading away, soon dawn will appear, and there will be an absent of light that will resolve in darkness. Light will disappear, and darkness will appear and so there will be no more line on this sheet of paper. In conclusion- Only my pen can determine what the future holds for me. I hope that this pen have enough ink, to write about the glories of this sunshine. Now I will file this paper and put it away for I have no guarantee that...
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...July 13, 2015 Cognitive view writing is a very simplified and descriptive writing that paints a picture and allows the person reading it to comprehend and understand what they are reading. I recently wrote a brochure to hand out to my employees here at UPS on heat related injuries. I wrote simple steps to prevent getting overheated, and the dangers of what could happen if proper measures were not taken. I gave examples and illustrations that would make the employees stop and think about what to do as they are getting hot, and before they get over heated and tragedy occurs. Some examples of this would be proper amounts of water drank daily, and proper amounts of water drank while working in the heat. I explained how caffeinated drinks, sugary foods, and some medications will dehydrate the body, which can lead to heat exertion, heat stroke, or even death. I added many pictures to illustrate proper hydrating methods, and pictures showing foods and drinks that can quickly dehydrate a person. I also explained and illustrated what to do in case a fellow employee showed signs of heat exertion, or stroke. After brochure is read and explained each employee must take, and pass a test at 100 percent. Each employee must also verbally explain to me proper methods to helping a fellow employee that shows signs of heat distress. I have each employee to take the test to make sure each and every employee not only understands, but also remembers what they have read. The conclusion...
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