Compute the pre-JIT maintenance cost per unit for each product.


Question Description:

29.99

Compute the pre-JIT maintenance cost per unit for each product. 1 answer below » JIT FEATURES AND PRODUCT COSTING ACCURACY Prior to installing a JIT system, Pohlson Company, a producer of bicycle parts, used maintenance hours to assign maintenance costs to its three products (wheels, seats, and  handle bars). The maintenance costs totaled $1,960,000 per year. The maintenance ours used by each product and the quantity of each product produced are as follows: Maintenance Hours Quantity Produced Wheels 60,000 52,500 Seats 60,000 52,500 Handle bars 80,000 70,000 After installing JIT, View complete question » JIT FEATURES AND PRODUCT COSTING ACCURACY Prior to installing a JIT system, Pohlson Company, a producer of bicycle parts, used maintenance hours to assign maintenance costs to its three products (wheels, seats, and  handle bars). The maintenance costs totaled $1,960,000 per year. The maintenance ours used by each product and the quantity of each product produced are as follows: Maintenance Hours Quantity Produced Wheels 60,000 52,500 Seats 60,000 52,500 Handle bars 80,000 70,000 After installing JIT, three manufacturing cells were created, and cell workers were trained to perform preventive maintenance and minor repairs. A full-time maintenance person was also assigned to each cell. Maintenance costs for the three cells still totaled $1,960,000; however, these costs are now traceable to each cell as follows: Cell, wheels $532,000 Cell, seats 588,000 Cell, handle bars 840,000 Required: 1. Compute the pre-JIT maintenance cost per unit for each product. 2. Compute the maintenance cost per unit for each product after installing JIT. 3. Explain why the JIT maintenance cost per unit is more accurate than the pre-JIT cost. View less » Jul 24 2014 07:51 AM

Answer

29.99