Refer to the scenario located in the “Analyze, Think, Communicate” section 12-5 of Ch. 12,...

Question

Refer to the scenario located in the “Analyze, Think, Communicate” section 12-5 of Ch. 12, “Job-Order, Process, and Hybrid Costing Systems” of Fundamental Managerial Accounting Concepts. This scenario involves an altercation between Rene Alverez and Bill Sawyer and requires you to weigh in with calculations and comments on the matter.

Read the scenario in the textbook and complete the activity below.

Compute the equivalent cost per unit, assuming the ending inventory is considered to be 40 percent complete.

Compute the equivalent cost per unit, assuming the ending inventory is considered to be 60 percent complete.

Write a 350-word summary of your calculations and findings. Comment on Mr. Sawyer’s motives for establishing the percentage of completion at 60 percent rather than 40 percent.

Submit calculations and summary.

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Prince · Accepted Answer

Summary: 
A discrepancy arose when René Alverez, the newly hired accountant, thought that the department's ending inventory was only about 40% complete, in contrast to Mr. Sawyer's estimate of the proportion of completion of the department's ending inventory at 60 percent complete in the scenario found in the "Analyze, Think, communicate" section 12-5 of Ch. 12 of Fundamental Managerial Accounting Concepts, "Job-Order, Process, and Hybrid Costing Systems." Ms. Alverez signed Mr. Sawyer's estimate even though she thought she was correct. According to the scenario, the corporation started with a starting inventory of 5.500 units, began producing 94,500 units,

Refer to the scenario located in the “Analyze, Think, Communicate” section 12-5 of Ch. 12, “Job-Order, Process, and Hybrid Costing Systems” of Fundamental Managerial Accounting Concepts . This...

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