Briefly Describe the Scanlon Plan

question 49

Essay

Briefly describe the Scanlon Plan.

Understand the treatment of manufacturing overhead in the determination of the cost of goods available for sale.

Understand how the closing out of overapplied or underapplied manufacturing overhead affects cost of goods sold.

Learn the significance of actual versus estimated direct labor-hours in overhead application.

Identify and describe the components of manufacturing costs including direct materials, direct labor, and manufacturing overhead.

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Definitions:

Presentment

The formal presentation of a financial instrument, such as a check, for payment.

Dishonor

The failure to pay or accept a negotiable instrument that has been properly presented.

Notice

A formal declaration or warning of something, often used in legal contexts to inform parties of actions, requirements, or proceedings.

Surrender

The act of giving up something or yielding possession, often under duress or in compliance with a legal requirement.