b’Below is an attachment of the case study. There is also an outline that descrinyzbe what each paragraph should be about.’
Case 2 – Fall 2020
CrittEar and Pacific-Research Laboratories
Susan Hansen first came up with the CrittEar concept when she noticed her golden retriever was becoming more sound sensitive as he aged. As she was researching solutions for ways to help him, she discovered what an incredibly common problem it was. Dogs hear, on average, five times better than humans. As a result, those loud noises become particularly unbearable.
There’s also the issue that noise distractions can create for service dogs and dogs employed in the military, police forces, search and rescue operations and even as assistants for hunters. Constant exposure to loud noises has the potential to create long term damage. Standard calming methods like pheromones and vests aren’t appropriate.
Susan’s idea to resolve the problem came from a simple slogan; “Dogs can’t fear what they can’t hear.” If earplugs were available to protect the ears of people, then why not dogs?
Of course, developing earplugs for dogs involved taking certain canine-specific issues into account, including:
To manage these problems, Susan chose a medical-grade memory foam material that provided comfort and conformed to the shape and size of the dog’s ear easily.
The simple use, efficacy, and affordability of the product made them ideal for resolving the common issues with noise phobia in dogs of all sizes. Results have been so positive in dogs that the team at CrittEar is exploring lines for cats, horses, and other animals who commonly suffer noise phobias.
The information given above is an actual small manufacturing solution. See the links to the companies below:
The financial information given below is hypothetical.
CRITTEAR Company produces CrittEars. Overhead is applied to products on the basis of direct labor hours. The denominator level of activity is 4,030 hours. The company’s standard cost card is below:
Direct materials – Memory Foam: 6 pieces per CrittEar at $0.50 per piece
Direct labor: 1.3 hours per CrittEar at $8 per hour
Variable manufacturing overhead: 1.3 hours per CrittEar at $4 per hour
Fixed manufacturing overhead: 1.3 hours per CrittEar at $6 per hour
During January, the company produced 3,000 CrittEars. The fixed overhead expense budget was $24,180.
Actual costs in January were as follows:
Direct materials: 25,000 pieces purchased at a cost of $0.48 per piece
Direct labor: 4,000 hours were worked at a cost of $36,000
Variable manufacturing overhead: Actual cost was $17,000
Fixed manufacturing overhead: Actual cost was $25,000
You are the comptroller for Pacific Research Laboratories. Write a memo to the CFO regarding the following cost variances for January:
The memo should include the following separate paragraphs:
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