Mexican Rancho Era Reflective Essay Part II. Reflective Essay (Journal) on the Mexican Rancho Era Please write about three pages of observations on the era

Mexican Rancho Era Reflective Essay Part II. Reflective Essay (Journal) on the Mexican Rancho Era
Please write about three pages of observations on the era of Mexican rule in California, using selections from Connecting California. Relate your observations to the events and concepts we have discussed in class. Reflect on how the documents help you grow as a historian and relate your comments to at least three of the Habits of Mind for History.Please start your essay with an overall perspective on what you learned. Then examine each of your sources (critically) to show how they add to our understanding. Use about four selections from Connecting California, related to the era, that you have not used before. Please put titles of documents in bold the first you discuss them in a significant way.
Using your own research, include at least one additional primary source from the early to mid-1800s in your reflective essay. The additional source does not need to be about California, as long as it relates to concepts or events you discuss in the essay. Traditional and Activity Based Costing
CarryAll Company produces briefcases from leather, fabric, and synthetic materials in a single
production department. The basic product is a standard briefcase made from leather and lined with
fabric. CarryAll has a good reputation in the market because the standard briefcase is a high-quality
item that has been produced for many years.
Last year, the company decided to expand its product line and produce specialty briefcases
for special orders. These briefcases differ from the standard in that they vary in size, contain both
leather and synthetic materials, and are imprinted with the buyer’s logo (the standard briefcase
is simply imprinted with the CarryAll name in small letters). The decision to use some synthetic
materials in the briefcase was made to hold down the materials cost. To reduce the labor costs per
unit, most of the cutting and stitching on the specialty briefcases is done by automated machines,
which are used to a much lesser degree in the production of the standard briefcases. Because of
these changes in the design and production of the specialty briefcases, CarryAll management
believed that they would cost less to produce than the standard briefcases. However, because they
are specialty items, they were priced slightly higher; standards are priced at $30 and specialty
briefcases at $32.
After reviewing last month’s results of operations, CarryAll’s president became concerned
about the profitability of the two product lines because the standard briefcase showed a loss while
the specialty briefcase showed a greater profit margin than expected. The president is wondering
whether the company should drop the standard briefcase and focus entirely on specialty items.
Units and cost data for last month’s operations as reported to the president are as follows:
dard Specialty
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Units produced
Standard
Specialty
10,000
2,500
Direct materials
Leather (1 sq. yd. ×$15.00; ½ sq. yd. ×$15.00)
$15.00
$7.50
Fabric (1 sq. yd. ×$5.00; 1 sq. yd. × $5.00)
$ 5.00
$5.00
Synthetic
$5.00
Total materials
$20.00
$17.50
Direct labor (½ hr. × $12.00, ¼ hr. × $12.00)
$6.00
$3.00
Manufacturing Overhead (1/2 hr. × $8.98, ¼ hr. × $8.98)
$4.49
$2.25
Cost per unit
$30.49
$22.75
Factory overhead is applied on the basis of direct labor hours. The rate of $8.98 per direct labor
hour was calculated by dividing the total overhead ($50,500) by the direct labor hours (5,625). As
shown in the table, the cost of a standard briefcase is $0.49 higher than its $30 sales price; the
specialty briefcase has a cost of only $22.75, for a gross profit per unit of $9.25. The problem with
these costs is that they do not accurately reflect the activities involved in manufacturing each
product. Determining the costs using ABC should provide better product costing data to help gauge
the actual profitability of each product line.
The manufacturing overhead costs must be analyzed to determine the activities driving the
costs. Assume that the following costs and cost drivers have been identified:
• The Purchasing Department’s cost is $6,000. The major activity driving these costs is the number
of purchase orders processed. During the month, the Purchasing Department prepared the
following number of purchase orders for the materials indicated:
Leather
20
Fabric
30
Synthetic material
50
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• The cost of receiving and inspecting materials is $7,500. These costs are driven by the number
of deliveries. During the month, the following number of deliveries were made:
Leather
30
Fabric
40
Synthetic material
80
• Production line setup cost is $10,000. Setup activities involve changing the machines to produce
the different types of briefcases. Each setup for production of the standard briefcases requires one
hour; each setup for specialty briefcases requires two hours. Standard briefcases are produced in
batches of 200, and specialty briefcases are produced in batches of 25. During the last month, there
were 50 setups for the standard item and 100 setups for the specialty item.
• The cost of inspecting ?nished goods is $8,000. All briefcases are inspected to ensure that quality
standards are met. However, the ?nal inspection of standard briefcases takes very little time
because the employees identify and correct quality problems as they do the hand cutting and
stitching. A survey of the personnel responsible for inspecting the ?nal products showed that 150
hours were spent on standard briefcases and 250 hours on specialty briefcases during the month.
• Equipment-related costs are $6,000. Equipment-related costs include repairs, depreciation, and
utilities. Management has determined that a logical basis for assigning these costs to products is
machine hours. A standard briefcase requires 1/2 hour of machine time, and a specialty briefcase
requires two hours. Thus, during the last month, 5,000 hours of machine time relate to the standard
line and 5,000 hours relate to the specialty line.
• Plant-related costs are $13,000. These costs include property taxes, insurance, administration,
and others. For the purpose of determining average unit costs, they are to be assigned to products
using machine hour
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Required
a. briefly discuss the advantages and disadvantages of the traditional single plantwide rate cost
allocation, and activity-based costing.
b. Using activity-based costing concepts, what overhead costs should be assigned to the two
products?
c. What is the unit cost of each product using activity-based costing concepts?
d. Reevaluate the president’s concern about the pro?tability of the two product lines.
e. Discuss the merits of activity-based management as it relates to CarryAll’s ABC cost system.
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