b6021 module 2 assignment 2 manufacturing overhead, b6021 module 2 assignment 2 borealis manufacturing company ,argosy b6021,b6021,argosy b6021 week 2 tutorial,b6021 week 2 assignment,argosy b6021 week 2 help

1. ARGOSY B6021 Module 2 Assignment 2 Borealis
Manufacturing Company NEW
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B6021 Module 2 Assignment 2 Borealis Manufacturing
Company NEW
Borealis Manufacturing has just completed a major
change in its quality control (QC) process. Previously,
products had been reviewed by QC inspectors at the
end of each major process, and the company's 10 QC
inspectors were charged to the operation or job as
direct labor. In an effort to improve efficiency and
quality, a computerized video QC system was
purchased for $250,000. The system consists of a
minicomputer, fifteen video cameras, and other
peripheral hardware and software. The new system
uses cameras stationed by QC engineers at key points
in the production process. Each time an operation
changes or there is a new operation, the cameras are

2. moved, and a new master picture is loaded into the
computer by a QC engineer. The camera takes pictures
of the units in process, and the computer compares
them to the picture of a “good” unit. Any differences
are sent to a QC engineer, who removes the bad units
and discusses the flaws with the production
supervisors. The new system has replaced the 10 QC
inspectors with two QC engineers.
The operating costs of the new QC system, including
the salaries of the QC engineers, have been included as
factory overhead in calculating the company's
plantwide manufacturing-overhead rate, which is
based on direct-labor dollars. The company's
president is confused. His vice president of production
has told him how efficient the new system is. Yet there
is a large increase in the overhead rate. The
computation of the rate before and after automation is
as follows:
Before After
Budgeted Manufacturing Overhead
1,900,000 2,100,000

3. Budgeted Direct Labor Cost 1,000,000
700,000 Budgeted Overhead Rate 190% 300%
“Three hundred percent,” lamented the president.
“How can we compete with such a high overhead
rate?”
Using the module readings and the Argosy University
online library resources, research manufacturing
overhead.
Review the situation. Complete the following:
•Define “manufacturing overhead,” and:
◦Cite three examples of typical costs that would be
included in manufacturing overhead.
◦Explain why companies develop predetermined
overhead rates.
•Explain why the increase in the overhead rate should
not have a negative financial impact on Borealis
Manufacturing.

4. •Explain how Borealis Manufacturing could change its
overhead application system to eliminate confusion
over product costs.
•Describe how an activity-based costing system might
benefit Borealis Manufacturing.