CIMA Engineering Uses a Manufacturing Costing System with One Direct

question 65

Essay

CIMA Engineering uses a manufacturing costing system with one direct cost category (direct materials)and three indirect cost categories:
a.Setup,production order,and materials-handling costs that vary with the number of batches.
b.Manufacturing operations costs that vary with machine-hours.
c.Costs of engineering changes that vary with the number of engineering changes made.
In response to competitive pressures at the end of 2016,Medical Instruments used value-engineering
techniques to reduce manufacturing costs.Actual information for 2015 and 2016 is:

The management of CIMA Engineering wants to evaluate whether value engineering has succeeded in
reducing the target manufacturing cost per unit of one of its flow controllers by 10%.Actual results for 2015 and 2016 for the flow controller are:

Required:
a.Calculate the manufacturing cost for both years.
b.Did the company achieve the target manufacturing cost per unit in 2016? Explain.

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Definitions:

B Cells

A type of white blood cell involved in the immune response by producing antibodies to neutralize pathogens.

Antigens

Substances or molecules that are recognized by the immune system and can evoke an immune response.

Thymus

A gland located behind the sternum and between the lungs that is involved in the development of the body's immune system, particularly in maturing T lymphocytes.

Pre-T Cells

Immature T cells that are in the process of developing into functional T cells, located in the thymus gland.