Question

I'll rate posting for sec times just do last parts like cost and balance sheet ( account balance and cost incurred ) that's it ready question carefully then answer all last part thanks

Charles Maxwell is starting a cheesecake bakery, Able Baker Charlie Company, to produce and sell different flavored cheesecakes to restaurants and the general public. He has just begun his study of accounting, and is a bit confused about the many types of reports he has read about and how they will help him run his business. He asks you to help him clarify what the differences between managerial accounting and financial accounting are. He’s also wondering how to set up his inventory, how to classify the costs of his business, and how to fill in some missing information.

	Required:
1.	Choose whether the characteristics on the Managerial vs. Financial panel are most often associated with managerial accounting or financial accounting.
2.	Charles has provided some of the costs he expects to incur on the Cost Classification panel. Decide on the classifications that could be applied to each of these costs using the table provided. The cost object in each case is the cheesecake.
3.	Charles found some sample income statements and balance sheets on the Internet, and asked which of them might be most appropriate for a manufacturing business like his. Review income statements A and B on the Income Statements panel, and balance sheets C and D on the Balance Sheets panel. Determine which income statement and balance sheet would be most appropriate for a manufacturing business like Able Baker Charlie. Then, on the Financial Statements panel, denote which income statement and balance sheet would be most appropriate for a manufacturing business.
4.	At the end of February, after the second month of operations of Able Baker Charlie Company, Charles shows you the data he’s collected, but he was unable to figure out some of the amounts. On the Costs and Balances panel, determine the missing amounts. Note: It may be helpful to use T accounts to map the flow of the amounts through the manufacturing accounts and solve for the missing dollar values.

Managerial vs. Financial

Choose whether the following characteristics are most often associated with managerial accounting or financial accounting.

	Managerial Accounting	Financial Accounting
Primarily used for internal decision making
Generally Accepted Accounting Principles (GAAP) must be used
Prepared statements usually pertain to the company as a whole rather than individual departments or products
Information provided will often be subjective, such as estimated future results
Often prepared on an as-needed basis rather than at fixed intervals
Use principles of the Sustainability Accounting Standards Board (SASB) to provide sustainability information to external financial statement users
Consideration of sustainability practices to contribute to the company’s long-term success
Using eco-efficiency measures to reduce expenses

Cost Classification

Charles has provided some of the costs he expects to incur as follows. Decide on the classifications that could be applied to each of these costs using the table provided. The cost object in each case is the cheesecake.

Cost	Product	Period	Direct	Direct	Factory	Selling	Administrative	Direct	Indirect	Prime	Conversion
	Cost	Cost	Materials	Labor	Overhead	Expense	Expense	Cost	Cost	Cost	Cost
Eggs used to make cheesecakes
Baker’s wages
Delivery driver wages
Depreciation of office computers
Power to run the cheesecake ovens
President’s salary
Sales commissions
Factory supervisor salary

Financial Statements

Charles found some sample income statements and balance sheets on the Internet, and asked which of them might be most appropriate for a manufacturing business like his. Review income statements A and B on the Income Statements panel, and balance sheets C and D on the Balance Sheets panel. Determine which income statement and balance sheet would be most appropriate for a manufacturing business like Able Baker Charlie Company.

Which income statement is most appropriate for a manufacturing business?

Income statement A

Income statement B

Which balance sheet is most appropriate for a manufacturing business?

Balance sheet C

Balance sheet D

Income Statements

Income Statement A (scroll down for Income Statement B):

Sample Company A

Income Statement

For the Year Ended December 31, 20Y8

1	Sales		$42,000.00
2	Beginning finished goods inventory	$5,250.00
3	Plus cost of goods manufactured	6,400.00
4	Cost of finished goods available for sale	$11,650.00
5	Less ending finished goods inventory	400.00
6	Cost of goods sold		11,250.00
7	Gross profit		$30,750.00
8	Operating expenses:
9	Selling expenses	$6,400.00
10	Administrative expenses	5,250.00
11	Total operating expenses		11,650.00
12	Net income		$19,100.00

Income Statement B:

Sample Company B

Income Statement

For the Year Ended December 31, 20Y8

1	Sales		$42,000.00
2	Beginning merchandise inventory	$5,250.00
3	Plus net purchases	6,400.00
4	Merchandise available for sale	$11,650.00
5	Less ending merchandise inventory	400.00
6	Cost of merchandise sold		11,250.00
7	Gross profit		$30,750.00
8	Operating expenses:
9	Selling expenses	$6,400.00
10	Administrative expenses	5,250.00
11	Total operating expenses		11,650.00
12	Net income		$19,100.00

Balance Sheets

Balance Sheet C (scroll down for Balance Sheet D):

Sample Company C

Balance Sheet

December 31, 20Y8

1	Assets
2	Cash		$20,800.00
3	Accounts receivable (net)		10,000.00
4	Merchandise inventory		6,000.00
5	Supplies		2,100.00
6	Land		17,000.00
7	Total assets		$55,900.00
8	Liabilities
9	Accounts payable		$17,800.00
10	Stockholders’ Equity
11	Common stock	$19,000.00
12	Retained earnings	19,100.00
13	Total stockholders’ equity		38,100.00
14	Total liabilities and stockholders’ equity		$55,900.00

Balance Sheet D:

Sample Company D

Balance Sheet

December 31, 20Y8

1	Assets
2	Cash		$20,800.00
3	Accounts receivable (net)		10,000.00
4	Inventories:
5	Finished goods	$2,000.00
6	Work in process	1,500.00
7	Materials	2,500.00	6,000.00
8	Supplies		2,100.00
9	Land		17,000.00
10	Total assets		$55,900.00
11	Liabilities
12	Accounts payable		$17,800.00
13	Stockholders’ Equity
14	Common stock	$19,000.00
15	Retained earnings	19,100.00
16	Total stockholders’ equity		38,100.00
17	Total liabilities and stockholders’ equity		$55,900.00

Costs and Balances

At the end of February, after the second month of operations of Able Baker Charlie Company, Charles shows you the data he’s collected, but he was unable to figure out some of the amounts. Review the following data and fill in the missing amounts on the chart for Able Baker Charlie Company. Note: It may be helpful to use T accounts to map the flow of the amounts through the manufacturing accounts and solve for the missing dollar values. It may also be helpful to review the steps for determining the cost of materials used, total manufacturing cost incurred, and cost of goods manufactured.

Data for February
Decrease in materials inventory	$3,300
Materials inventory on Feb. 28	50% of materials inventory on Jan. 31
Direct materials purchased	$12,600
Direct materials used	3 times the direct labor incurred
Total manufacturing costs incurred in period	$29,400
Total manufacturing costs incurred in period	70% of Cost of Goods Manufactured
Total manufacturing costs incurred in period	$7,000 less than Cost of Goods Sold

Account	Account Balances		Costs Incurred
	Jan. 31	Feb. 28
Materials Inventory			Direct Materials Used
Work in Process Inventory	$27,000		Direct Labor Incurred
Finished Goods Inventory		$16,000	Factory Overhead Incurred
			Cost of Goods Sold

Answer 1

Choose whether the following characteristics are most often associated with managerial accounting or financial accounting.
Primarily used for internal decision making	Managerial Accounting
Generally Accepted Accounting Principles (GAAP) must be used	Financial Accounting
Prepared statements usually pertain to the company as a whole rather than individual departments or products	Financial Accounting
Information provided will often be subjective, such as estimated future results	Managerial Accounting
Often prepared on an as-needed basis rather than at fixed intervals	Managerial Accounting
Use principles of the Sustainability Accounting Standards Board (SASB) to provide sustainability information to external financial statement users	Financial Accounting
Consideration of sustainability practices to contribute to the company’s long-term success	Managerial Accounting
Using eco-efficiency measures to reduce expenses	Managerial Accounting

Which income statement is most appropriate for a manufacturing business?

Correct Answer -Income statement A

This is Because it has all the elements of expenses and accounts that a manufacturing concern needs. Income statement B is more appropriate for trading company.

Which balance sheet is most appropriate for a manufacturing business?

Correct Answer-Balance sheet D

Balance sheet has assets which shows details of all kinds of inventory that a manufacturing concern have.

Cost	Classification of Cost
Eggs used to make cheesecakes	Product Cost/Direct Material/Prime Cost
Baker’s wages	Direct Labor/Prime Cost
Delivery driver wages	Selling Expenses
Depreciation of office computers	Administrative Expenses
Power to run the cheesecake ovens	Direct Cost/Factory Overheads
President’s salary	Administrative Expenses
Sales commissions	Selling Expenses
Factory supervisor salary	Factory Overheads

Data for February
Decrease in materials inventory	$3,300
Materials inventory on Feb. 28	50% of materials inventory on Jan. 31
Direct materials purchased	$12,600
Direct materials used	3 times the direct labor incurred
Total manufacturing costs incurred in period	$29,400
Total manufacturing costs incurred in period	70% of Cost of Goods Manufactured
Total manufacturing costs incurred in period	$7,000 less than Cost of Goods Sold

Account	Account Balances		Costs Incurred
	Jan. 31	Feb. 28
Materials Inventory	$                                                                                 6,600.00	$                       3,300.00	Direct Materials Used	$                     15,900.00
Work in Process Inventory	$                                                                               27,000.00	$                     14,400.00	Direct Labor Incurred	$                       5,300.00
Finished Goods Inventory	$ 10400.00	$                     16,000.00	Factory Overhead Incurred	$                       8,200.00
			Cost of Goods Sold	$                     36400.00

Calculations
Cost of goods Manufactured		(29400/70%)		$                     42,000.00
Cost of goods Sold		(29400+7000)		$                     36400.00
Material used		(12600+3300)		$                     15,900.00
Direct Labor Incurred
Opening Finished Goods Inventory (COGS-COGM+Closing Finished Goods)		(36400-42000+16000)		$ 10400
Direct labor incurred		(1/3 of Material Used)		$                       5,300.00
Opening and closing Material inventory has a difference of $ 3300.
Opening Material Inventory		(3300+50%)		$                       6,600.00
Closing material Inventory		(6600/2)		$                       3,300.00
Calculation of Closing WIP
COGM                                                                                                      (A)	$                                                                               42,000.00
Opening WIP                                                                                         (B)	$                                                                               27,000.00
Total Manufacturing cost                                                                   (C )	$                                                                               29,400.00
Closing WIP (Balancing Figure)                                             (D=B+C-A)	$                                                                               14,400.00

Calculation of Factory overheads
Total Manufacturing cost                                                             (A)	$                                                                               29,400.00
Less Direct Labor                                                                              (B)	$                                                                                 5,300.00
Less material used                                                                           (C )	$                                                                               15,900.00
Factory overheads                                                                      (D=A-B-C)	$                                                                                 8,200.00