Essay on Bus 630 Week 2

700 Words Aug 21st, 2014 3 Pages
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BUS 630 WEEK 2 ASSIGNMENT AUERBACH ENTERPRISES
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Auerbach Enterprises. Complete Case 3A (Auerbach Enterprises) in Chapter 3.
Auerbach Enterprises manufactures air conditioners for automobiles and trucks manufactured throughout North America. The company designs its products with flexibility to accommodate many makes and models of automobiles and trucks. The company’s two main products are MaxiFlow and Alaska. MaxiFlow uses a few complex
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28 16
Radiator assembly, weld, and test……. 30 74
Compressor parts fabrication……… 32 8
Compressor assembly and test……… 26 66
Total 116 164
Required:
1. Compute the departmental overhead rates using machine hours as the cost driver.
2. Compute a company-wide overhead rate using machine hours as the cost driver.
3. Compute the overhead costs per batch of MaxiFlow and Alaska assuming:
(a) The company-wide rate.
(b) The departmental rates.
4. Compute the total costs per unit of MaxiFlow and Alaska assuming:
(a) The company-wide rate.
(b) The departmental rates.
5. Is one product affected more than the other by use of departmental rates rather than a company-wide rate?
Why or why not?
In this case, you are provided the overhead cost data for the Auerbach Enterprises. Management needs advice in determining how to allocate these costs utilizing a job order costing system either department-wide or company-wide. Address Questions 1through 5 located at the end of the case. Based on the case questions, you are required to provide a three to five double-spaced written report addressing management’s concerns and providing recommendations. The written report should be properly formatted according to APA guidelines and demonstrate research and critical thinking skills. Conclusions and recommendations should be supported by at least 2 scholarly sources from the Ashford Library or other external sources, excluding the textbook. For

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