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Extra info for Cost Accounting: Foundations and Evolutions (Available Titles Cengagenow)
Exhibit 2–7 Building Construction Costs Manufacturing Cost Direct material Manufacturing overhead Direct labor Total cost 40% 35% 25% $200,000 Clerical Cost 34% 44% 22% $750 A manufacturer can be deﬁned as any company engaged in a high degree of conversion of raw material input into a tangible output. Manufacturers typically use people and machines to convert raw material to output that has substance and can, if desired, be physically inspected. A service company is a ﬁrm that uses a signiﬁcant amount of labor to engage in a high or moderate degree of conversion.
A. Discuss your reactions to this quote from a legal standpoint. b. Discuss your reactions to this quote from an ethical standpoint. c. How would you resolve any ethical conﬂicts that exist between your two answers? Ethics 39. 8 (Ethics; research; writing) Use library and Internet resources to research the names and countries of the stock exchanges on which Toyota Motor Company is listed. Write a short paper on the complexities relative to ethics of listing on stock exchanges across multiple countries.
Some important types of costs are summarized in Exhibit 2–1. 1 Why are costs associated with a cost object? 2 What assumptions do accountants make about cost behavior, and why are these assumptions necessary? Association with Cost Object A cost object is anything for which management wants to collect or accumulate costs. Production operations and product lines are common cost objects. For example, Toyota’s Princeton, Indiana, plant makes Tundra trucks, Sequoia SUVs, and Sienna minivans. Company managers could deﬁne the plant as the cost object and request information about production costs for a speciﬁc period; alternatively, managers could deﬁne the Tundra truck as the cost object and request information about production costs during the same period.