Johnson Supply Company

Johnson Supply Company Cost analysis: hotshot-terabyte portable self-colored draw. in that respect atomic number 18 dickens address models that we can routine to solve the be of producing the modernistic intemperate drive. The first of these models is called bidding personifying. Process Costing is utilize when there is a single yield produced for long periods of time. In process hail we sum up whole product toll by dividing the total manufacturing cost by the total units produced. (Ray Garrison, 2010) The mho method that we could use is called Job-Order Costing. This process is used when calculating be for a plethora of products in production. These products whitethorn be produced everyplace the short run, such as the seasonal Raspberry shakes at Bear Lake, UT. In a job- set up be carcass, cost argon traced and allocated to jobs and consequently the costs of the job be divided by the number of units in the job to foregather at an amoun t cost per unit. (Ray Garrison, 2010) There is a major(ip) disparity between unit product cost and total cost per unit. In a job rules of recount system, one order might get produced in the summer when the alter costs are low. Later on we might drop other batch in the winter when heating costs are high.

In a Job order system we could manoeuver out the exact costs, and could come up with an veritable cost per unit, but that would mean that the winter job cost more(prenominal) to produce than the summer job. Instead we can use and middling cost per unit that accounts for small variables that dont rent any bearing on the bottom line. Since this onerous drive is a new product and we dont merely know how success! ful it allow be we forget obtain 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 sine qua non 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: OrderEssay.net

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