Module 11 Homework Use complete sentences. Show and label all work to receive an

Question

Module 11 Homework Use complete sentences. Show and label all work to receive any credit for the homework. Do not turn in this page with or es your homework submit vour answers on a separate sheet of paper Laura Norder is an attorney who does legal research for consumer product lawsuits. research teams for each case she consults on. Each research team consists of three individual consultants who are paid a $1,000 retainer per case to provide legal background on the case. A lap top computer and necessary supplies for each team are provided by Laura. Each team is lead by a supervisor, hired by Laura, paid a $5,000 retainer per month, regardless of the number of teams they supervise Classify each of following cost items as variable, fixed or mixed with respect to how the total costs of Laura Norder Attorney change as the number of research teams (cases) changes. Use V for variable, F for fixed, and M for mixed. To receive credit, give a short justification for each of your answers 1. She organizes a. Payments to individuals in each research group. b. Annual subscription by Laura's consulting firm to the "Law Review magazine. c. The cost of the Supervisor to the firm. d. Lap top computers provided to the researchers. e. Lease payments by Laura Norder for the law office. f. Electricity costs for the law office. 2. Brad Hammer owns a lumber and building supply retail store. He sells lumber, tools, fasteners, and other Given that activity is defined as the number of products sold, identify each of the costs building equipment. below as variable, fixed or mixed. Use V for variable, F for fixed, and M for mixed. To receive credit, give a short justification for each of your answers a. Cost of lumber b. Wages paid to employees who wait on customers if paid $300 per week. c. Wages paid to employees who wait on customers if paid on commission 20% of product sold d. wages paid to employees who wait on customers if paid $150 per week plus 10% commission on product sold. e. Insurance paid on retail store. f. Cost of shelving for the showroom. g. Cost of nails. 3. Bunks R Us, Inc. is a manufacturing firm that makes dorm room bunk beds. Each bed consists of two wooden rails, a head board, foot board and a hardware package. As the lumber progresses through the assembly process, worker create the rail, head board and foot board parts. Given activity is measured as the number of dorm beds produced, identify each of the costs below as variable, fixed or mixed. Use V for variable, F for fixed, and M for mixed. To receive credit, give a short justification for each of your answers a. Cost of rails for the wooden beds. b. Wages of direct labor workers, paid on piece rate of $5 per rail created. c. Wages of direct labor workers, paid $300 per week for creating the hardware packets. d. Wages of direct labor workers, paid $200 per week and $2 cents per head board created. e. Rent on production facilities f. Cost of hardware packets for the dorm beds. g. Production supervisors salary of $500 per week. h. Each part is wrapped in cardboard to prevent damage. How it the cost of cardboard classified? i. Utilities for the production facilities; water, electricity, and heat. j. Cost of shipping crates. There are 5 dorm beds stacked on every crate. k. Cost of the chop saw that cuts the rails to length Module Homework 11-1

Explanation / Answer

1 a.Payments to individuals in each research group V Total payment varies according to no.of cases b. Annual subscription by Laursa to magazine F Does not vary with teams/cases.Fixed payment c.The cost of the supervisor to the firm V Total cost varies with no.of teams organised d.Lap top computers provided to researchers V Total cost varies with no.of teams organised e.Lease payments by Laura for the law office F Fixed payment for a term f.Electricity cost for the law office M Increases as the no.of cases increase,but not in direct proportion 2 a. Cost of lumber V Varies with each unit of lumber sold b.Wages paid to employees ------$ 300 per week F Flat fixed rate per week c.Wages paid to employees ------20% *product sold V Varies with no.of products sold d. Wages to employees---150/week +10% commn. M Mixed with Flat fixed rate of 150/ week & a varying portion of $ 10*product sold e. Insurance paid on retail store F Does not vary with no.of product sold f.Cost of shelving the showroom F Does not vary with no.of product sold g.Cost of nails M Does not vary with no.of product sold but increases with increase in activity- a consumable item 3… a. Cost of rails for the wooden beds V Varies with no.of dorm beds b.Wage of direct labor workers--piece rate V Varies with no.of dorm beds c. Wages--300/week for creating hardware packets F Based on week ,not no.of beds d.Wages--200/week+2 cents per head board M Mixed with Flat fixed rate of 200/ week & a varying portion of 2 cents/head board e. Rent on production facilities F Does not vary with no.of beds.Going to be incurred ,even if there is no production f.Cost of hardware package for the dorm beds V Varies with no.of dorm beds g.Production supervisor's salary F Does not vary with no.of beds.Going to be incurred ,even if there is no production h.Cost of cardboard V Varies with no.of dorm beds i.Utilities cost M Does not vary with no.of product sold but increases with increase in activity- all consumables-indirect Ohs j.Cost of shipping crates M Variable not with each no.of bed ,but with no.of groups of beds k.Cost of the chopsaw F An item of tool for working- a fixed asset

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