Analysis of Direct Costs

Write a three to four (3-4) page paper in which you:

1. Predict the main costs (e.g. labor cost, material cost) associated with the production of VectorCal’s drone navigation system. Provide a rationale for your response.
2. Compare and contrast the direct and indirect costs associated with the drone navigation system that both your company and VectorCal would assume. Predict whether or not your company could easily control these costs and thus reduce production expenses. Justify your response.
3. Compare your company with VectorCal relative to the price of acquisition, semi-variable costs, and allocated direct and indirect costs of the drone navigation system. Justify your response.
4. Use at least three (3) quality resources in this assignment. Note: Wikipedia and similar Websites do not qualify as quality resources.

Your assignment must follow these formatting requirements:

• Be typed, double spaced, using Times New Roman font (size 12), with one-inch margins on all sides; citations and references must follow APA or school-specific format. Check with your professor for any additional instructions.
• Include a cover page containing the title of the assignment, the student’s name, the professor’s name, the course title, and the date. The cover page and the reference page are not included in the required assignment page length.

The specific course learning outcomes associated with this assignment are:

• Outline the process to forecast the likely price of an acquisition, calculate semi-variable costs, and allocate direct and indirect costs.
• Examine the various cost classifications, the different allocation bases, and the application of cost-accounting standards.
• Determine how to validate costs and certify cost and pricing data.
• Use technology and information resources to research issues in cost and price analysis.
• Write clearly and concisely about cost and price analysis using proper writing mechanics.

Grading for this assignment will be based on answer quality, logic/organization of the paper, and language and writing skills, using the following rubric.