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7. What is the cost for Forest Hill to conduct a g...

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7. What is the cost for Forest Hill to conduct a grade change? 8. What is the cost for Forest Hill to slit a reel of paperboard? As shown in Exhibit 1, only products A and C are routinely slit. For purposes of your analysis, assume the slitting equipment must be set up and adjusted between each reel slit. 9. Calculate the new volume-based overhead rate after removing grade change and slitting costs. 10. Determine the activity-based costs for grades A-D 11. Prepare a table that illustrates the percentage change in costs between the volume-based system and the strategic activity-based system. 12. What conclusions can you draw from your analysis? As a consultant to Forest Hill, what actions would you recommend?

 

Paper#3445 | Written in 18-Jul-2015

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