Unitron Corporation: Teaching Commentary
Date Submitted: 09/10/2006 04:40:00
Category: / Social Sciences / Communication Studies
Length: 16 pages (4271 words)
Category: / Social Sciences / Communication Studies
Length: 16 pages (4271 words)
OVERVIEW
This is an excellent short case to introduce the managerial accounting issues related to the "joint cost" problem. Classic microeconomics argues unequivocally that attempts to assign cost to individual products in a "joint" set constitute a complete waste of time--"just maximize the total revenue over the batch." Like the comparable adage to "price so that marginal cost equals marginal revenue," the economists' advice about joint costing is certainly accurate, given the assumptions, but …
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…Now<Tab/>Revised
<Tab/>Year 1<Tab/>20<Tab/>30
<Tab/>Year 2<Tab/>20<Tab/>15
<Tab/>Year 3 (First Quarter)<Tab/>5<Tab/>5
<Tab/>Total<Tab/>45<Tab/>50
Strategic Fit?
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