Don’t tell me we’ve lost another bid!” exclaimed Sandy Kovallas, president of Lenko Products, Inc. “I’m afraid so,” replied Doug Martin, the operations vice president. “One of our competitors underbid us by about $10,200 on the Hastings job.” “I just can’t figure it out,” said Kovallas. “It seems we’re either too high to get the job or too low to make any money on half the jobs we bid anymore. What’s happened?”

Lenko Products manufactures specialized goods to customers’ specifications and operates a job-order costing system. Manufacturing overhead cost is applied to jobs on the basis of direct labor cost. The following estimates were made at the beginning of the year:

Department

Cutting Machining Assembly Total Plant

Direct labor $ 313,000 $ 213,000 $ 411,000 $ 937,000

Manufacturing overhead $ 528,000 $ 865,830 $ 96,000 $ 1,489,830

Jobs require varying amounts of work in the three departments. The Hastings job, for example, would have required manufacturing costs in the three departments as follows:

Department

Cutting Machining Assembly Total plant

Direct materials $ 12,100 $ 900 $ 5,700 $ 18,700

Direct labor $ 6,600 $ 1,600 $ 12,900 $ 21,100

Manufacturing overhead ? ? ? ?

The company uses a plantwide overhead rate to apply manufacturing overhead cost to jobs.

Requirement:
Assuming the use of a plantwide overhead rate: Compute the rate for the current year
Determine the amount of manufacturing overhead cost that would have been applied to the Hastings job
Suppose that instead of using a plantwide overhead rate, the company had used a separate predetermined overhead rate in each department. Under these conditions Compute the rate for each department for the current year.
Determine the amount of manufacturing overhead cost that would have been applied to the Hastings job.
Assume that it is customary in the industry to bid jobs at 150% of total manufacturing cost (direct materials, direct labor, and applied overhead). What was the company’s bid price on the Hastings job if plantwide overhead rate had been used to apply overhead cost?
What would the bid price have been if departmental overhead rates had been used to apply overhead cost?
At the end of the year, the company assembled the following actual cost data relating to all jobs worked on during the year:

Department

Cutting Machining Assembly Total plant

Direct materials $ 760,000 $ 89,000 $ 410,000 $ 1,259,000

Direct labor 321,000 210,000 339,000 870,000

Manufacturing overhead $ 561,000 $ 830,000 $ 91,000 $ 1,482,000

Compute the underapplied or overapplied overhead for the year, assuming that a plantwide overhead rate is used.

Compute the underapplied or overapplied overhead for the year, assuming that departmental overhead rates are used

Discussion: Unit 6, Due Wednesday by 11:59 pm CT

Instructions:

• Read the following article and decide if the patient received quality care.

An example of the difficulty of making judgments about quality of care could be illustrated through the experience of a patient undergoing coronary artery bypass surgery. A patient with significant coronary artery disease consults with a cardiac surgeon prior to surgery. The cardiac surgeon spends little time with the patient during the preoperative visit. She makes little effort to educate the patient about what will happen before, during, and after surgery. One week later, the surgery is performed without complications. The length of stay for the patient in the acute care hospital is eleven days, which is five days longer than the average length of stay for patients undergoing coronary artery bypass surgery in that particular hospital. The total hospital costs for that patient are $10,000 more than for an average patient in that particular hospital. After adjusting the length of stay and cost for case complexity, the cost and length of stay is still much greater than for comparable cases in that hospital and region. The patient, however, survived the operation and had an uncomplicated hospital course and was free from postoperative complications. Three months later, the patient’s health is excellent, and he is able to enjoy tennis free from symptoms.

From a technical standpoint, the operation went flawlessly and the clinical outcome was excellent. The “art” of caring for the patient, however, was questionable, as the patient received little information about the care that he was going to receive before, during, and after surgery. The physician exhibited poor communication skills. And if utilization were considered a measure of quality, the prolonged length of stay and increased costs associated with the operation might be considered indicative of suboptimal quality of care.

Williams, S. J. & Torrens, P. R. Introduction to health services (5th ed.). Clifton Park, NY: Delmar Publishers.

• Now you decide. Did this patient receive excellent or poor quality medical care? Why?

Please be sure to validate your opinions and ideas with citations and references in APA format.

The post and responses are valued at 40 points. Please review post and response expectations. Please review the rubric to ensure that your response meets criteria.

Peer Response: Unit 6, Due Sunday by 11:59 pm CT

Instructions:

• Always construct your response in a word processing program like Word. Check for grammar, spelling, and mechanical errors. Make the corrections and save the file to your computer.
• Find the posts that you are going to reply to; respond to at least 2 other classmates.
• Submit your peer response.
• Your responses should demonstrate an understanding as well as critical thinking. Do not simply state “I agree” – add relevant information to your response.

Please be sure to validate your opinions and ideas with citations and references in APA format.

Pick an event or individual in the economic history of the United States or Europe, 1604 – present. Present background information, describe the importance at the time, and how it resonates today the question.As this is a junior/senior level class the work you do should be consistent with the scholarship expected of a junior or senior in college.This means and is not limited to: the paper should be well written and follow the conventional rules of writing. The paper should be adequately researched.Therefore, using Wikipedia as a sole source of information is not adequate research. Plagiarism should be avoided at all costs.The grading of the paper will based (approximately) on the following criteria:The actual writing in the paper, does it conform to the standard rules of writing and form? 20%The quality and depth of the research. Are there adequate citations, footnotes, and a bibliography? 20%Your presentation of the event or the individual. What was the importance at the time in history 40%The connection of the historical event to the present time 20%.