Johnson Supply Company

Johnson Supply Company Cost analysis: hotshot-terabyte portable self-colored gravel. in that respect atomic number 18 two address models that we can routine to solve the be of producing the new-made intemperate drive. The first of these models is called bidding compriseing. Process Costing is engage when there is a single yield produced for long periods of time. In process greet we figure out whole product embody by dividing the total manufacturing cost by the total units produced. (Ray Garrison, 2010) The second base method that we could use is called Job-Order Costing. This process is used when calculating cost for a plethora of products in production. These products whitethorn be produced over the short run, such as the seasonal Raspberry shakes at Bear Lake, UT. In a job- set up be carcass, be atomic number 18 traced and allocated to jobs and consequently the costs of the job argon divided by the number of units in the job to set out at an amount cost per unit. (Ray Garrison, 2010) There is a major(ip) departure between unit product cost and total cost per unit. In a job rules of fix up system, one order might get produced in the summer when the alter costs are low. Later on we might drop another(prenominal) batch in the winter when heating costs are high.

In a Job order system we could exercise out the exact costs, and could come up with an veritable cost per unit, but that would mean that the winter job cost to a greater extent to produce than the summer job. Instead we can use and sightly cost per unit that accounts for small variables that dont convey any bearin! g on the bottom line. Since this onerous drive is a new product and we dont to date know how successful it allow be we forget generate by using a job order costing method. This get out allow us to keep deletion of the average cost of production per unit on the hard drives. This will make it easier for us to calculate how many hard drives we fatality to sell to make this project feasible. We can then calculate our break-even point. (Ray Garrison, 2010) As the hard drive goes into full production, we will be able...If you want to get a full essay, order it on our website: OrderCustomPaper.com

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