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3 years ago

How can systems analysts prevent the creeping commitment approach to feasibility?

1 answer:

8 0

Feasibility – the measure of how beneficial or practical an information system will be to an organization. Feasibility analysis – the process by which feasibility is measured. Creeping Commitment – an approach to feasibility that proposes that feasibility should be measured throughout the life cycle.

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Buzz’s Florida Division is currently purchasing a part from an outside supplier. The company's Georgia Division, which has exces

Kobotan [32]

Answer:

Georgia will establish a transfer price of $18, that is, $22 - $4 = $18.

Explanation:

Since the company has excess capacity, the transfer price should be variable cost. Georgia has a plan to reduce variable cost on internal transfers by $4. Thus, the appropriate transfer price is $22 - $4 = $18.

3 0

4 years ago

Gelb Company currently manufactures 52,500 units per year of a key component for its manufacturing process. Variable costs are $

Hoochie [10]

Answer:

Gelb Company should choose to Buy the Component since it is the cheaper option. This gives a cost advantage of $28,875.

Explanation:

For each Option, include costs which are unavoidable because those would change as a result of this decision, they are relevant costs items.

Total incremental cost : Making

Variable costs (52,500 x $4.05) $212,625

Fixed Costs (unavoidable) $75,500

Total $288,125

Total incremental cost : Buying

Purchase Price ( 52,500 x $3.50) $183,750

Fixed Costs (unavoidable) $75,500

Total $259,250

Conclusion :

Gelb Company should choose to Buy the Component since it is the cheaper option. This gives a cost advantage of $28,875 ($288,125 - $259,250).

7 0

3 years ago

A company normally sells its product for $20 per unit. However, the selling price has fallen to $15 per unit. This company's cur

nata0808 [166]

Answer:

$200 (a deduction)

Explanation:

The accounting standard for inventories IAS 2 requires that inventory be carried at the lower of cost or net realizable value. Inventory will initially be recognized at the cost ( which includes the cost of the item and other associated cost such as freight ). However, its carrying amount must be reviewed to ensure it is not higher than the realizable value.

Given that the selling price is now $15 which is lower than the cost of $16, it means that the amount that can be realized from the sale of a unit is $15.

= $16 - $15

= $1

As such, an adjustment in form of a reduction of the carrying amount of $1 per unit is required. The amount of the lower cost of market adjustment the company must make as a result of this decline in value

= $1 × 200 units

= $200 (a deduction)

8 0

3 years ago

The equipment has an estimated useful life of ten years and an expected salvage value of 20 percent. Gravity Hospital’s December

ch4aika [34]

Answer:

The cost of the equipment when it was acquired on January 1, 2011 is $10000

Explanation:

10000÷5=2000

2000*10=20000

20000 80%

X 100% X=25000

25000*20%= 5000 25000-20000=20000

2011 2000

2012 2000

2013 2000

2014 2000

2015 2000 10000

8 0

4 years ago

Which of the following are true about cost allocation? A. Cost allocation is a form of transfer pricing for indirect costs B. Co

zhannawk [14.2K]

Answer:

E. All of the above

Explanation:

all of the given options qualify as being true about cost allocation.

6 0

3 years ago