Compare your company with SolarCal relative to the price of acquisition, semi-variable costs, and allocated direct and indirect costs of the solar power grids. Justify the response.
Instructions
Write a 2–3 page paper in which you:
- Analyze expenses:
o Analyze and provide detailed examples of the following costs that both Superstar Solar, Inc. and SolarCal will incur when contracting with the government.
o Labor costs.
o Manufacturing costs.
o Research and development.
o General administrative expenses. - Analyze direct and indirect costs:
o From the previous section, define and indicate which costs will be direct and indirect.
o Direct costs.
Labor.
Manufacturing.
Research and development.
General and administrative expenses.
o Indirect Costs
Labor.
Manufacturing.
Research and development.
General and administrative expenses. - Allocation Methods
o Discuss the following cost allocation methods and indicate which ones Superstar Solar, Inc., and SolarCal would use. Remember to provide a rationale for each of these methods.
o Units of production method.
o Machine hour method.
o Direct labor hour method.
o Direct labor cost method
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