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Scribners Corporation produces fine papers in three production departments—Pulping, Drying, and Finishing. In the Pulping Department, raw materials such as wood fiber and rag cotton are mechanically and chemically treated to separate their fibers. The result is a thick slurry of fibers. In the Drying Department, the wet fibers transferred from the Pulping Department are laid down on porous webs, pressed to remove excess liquid, and dried in ovens. In the Finishing Department, the dried paper is coated, cut, and spooled onto reels. The company uses the weighted-average method in its process costing system. Data for March for the Drying Department follow: |
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Percent Completed |
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| Units | Pulping | Conversion | ||||||
| Work in process inventory, March 1 | 3,200 | 100 | % | 80 | % | |||
| Work in process inventory, March 31 | 4,800 | 100 | % | 75 | % | |||
| Pulping cost in work in process inventory, March 1 | $ | 1,808 | ||||||
| Conversion cost in work in process inventory, March 1 | $ | 1,248 | ||||||
| Units transferred to the next production department | 174,200 | |||||||
| Pulping cost added during March | $ | 103,802 | ||||||
| Conversion cost added during March | $ | 75,206 | ||||||
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No materials are added in the Drying Department. Pulping cost represents the costs of the wet fibers transferred in from the Pulping Department. Wet fiber is processed in the Drying Department in batches; each unit in the above table is a batch and one batch of wet fibers produces a set amount of dried paper that is passed on to the Finishing Department. |
| Required: | |
| 1. | Determine the equivalent units for March for pulping and conversion. |
| 2. |
Compute the costs per equivalent unit for March for pulping and conversion. (Round your answers to 2 decimal places.) |
| 3. |
Determine the total cost of ending work in process inventory and the total cost of units transferred to the Finishing Department in March. (Round your intermediate calculations to 2 decimal places and your final answers to the nearest whole dollar.) |
| 4. | Prepare a cost reconciliation report for the Drying Department for March. (Round your intermediate calculations to 2 decimal places and your final answers to the nearest whole dollar.) |
rev: 09_29_2016_QC_CS-63658
In: Accounting
The following data represent the beginning inventory and, in order of occurrence, the purchases and sales of Las Lemus, Inc. for an operating period.
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Units |
Unit Cost |
Total Cost |
Units Sold |
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Beginning Inventory |
32 |
$36 |
$1,152 |
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Sale No. 1 |
10 |
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Purchase No. 1 |
28 |
40 |
1,120 |
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Sale No. 2 |
32 |
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Purchase No. 2 |
20 |
38 |
760 |
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Totals |
80 |
$3,032 |
42 |
Assuming Las Lemus, Inc. uses weighted-average (periodic) inventory
procedures, the ending inventory cost is:
| A. |
$1,444.00 |
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| B. |
$1,594.80 |
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| C. |
$1,442.00 |
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| D. |
$1,440.20 |
In: Accounting
At 30 June 2013, the financial statements of Detroit Ltd showed a building with a cost of $300,000 and accumulated depreciation of $150,000. The business uses the straight-line method to depreciate the building. When acquired, the building’s useful life was estimated at 50 years with no residual value. On 1 January 2019, Detroit Ltd completed structural improvements to the building costing $93,000 and paid with cash. As a result of the improvements, the useful life of the building was changed to 50 years from the date of the improvements. No change is expected in the residual value. Ignore GST.
Required:
In: Accounting
Sales Tax
Far and Wide Broadband provides Internet connection services to customers living in remote areas. During February 2020, it billed a customer a total of $295,000 before taxes. Weston also must pay the following taxes on these charges:
Required:
Assuming Far and Wide collects these taxes from the customer, what journal entry would Far and Wide make when the customer pays their bill? If an amount box does not require an entry, leave it blank.
| Accounts Receivable | |||
| Sales Taxes Payable (State) | |||
| Excise Taxes Payable (Federal) | |||
| Excise Taxes Payable (State) | |||
| Sales Revenue | |||
| (Record sale) |
In: Accounting
“One of the means by which the interests of the shareholders and other parties interested in the affairs of a company can be satisfied is the production and availability of comprehensive information about the financial and other standings through an annual report”.
(a) Identify and briefly discuss each of the components of a financial statement.
(b) Describe the functions of the auditor’s reports and the types of opinions in an annual report.
(c) An annual report consists of some other basic reports that are qualitative in nature. Enumerate and examine the reasons for the inclusion of such reports in the annual report of a company.
In: Accounting
At year-end (December 31), Chan Company estimates its bad debts as 0.40% of its annual credit sales of $879,000. Chan records its Bad Debts Expense for that estimate. On the following February 1, Chan decides that the $440 account of P. Park is uncollectible and writes it off as a bad debt. On June 5, Park unexpectedly pays the amount previously written off. Prepare the journal entries for these transactions.
In: Accounting
Holly Springs, Inc. contracted with Coldwater Corporation to have constructed a custom-made lathe. The machine was completed and ready for use on January 1, 2018. Holly Springs paid for the lathe by issuing a $310,000 note due in three years. Interest, specified at 4%, was payable annually on December 31 of each year. The cash market price of the lathe was unknown. It was determined by comparison with similar transactions for which 8% was a reasonable rate of interest. Holly Springs uses the effective interest method of amortization.
Required:
1. Prepare the journal entry on January 1, 2018,
for Holly Springs’ purchase of the lathe.
2. Prepare an amortization schedule for the
three-year term of the note.
3. Prepare the journal entries to record (a)
interest for each of the three years and (b) payment of the note at
maturity.
In: Accounting
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In: Accounting
A project has an initial cost of $160,000 and an estimated
salvage value after 15 years of $75,000. Estimated average annual
receipts are $30,000. Estimated average annual disbursements are
$16,000. Assuming that annual receipts and distributions will be
uniform for the 15 years, compute the prospective rate of return
before taxes.
In: Accounting
Liang Company began operations on January 1, 2015. During its first two years, the company completed a number of transactions involving sales on credit, accounts receivable collections, and bad debts. These transactions are summarized as follows.
2015
2016
Required:
Prepare journal entries to record Liang’s 2015 summarized transactions and its year-end adjustments to record bad debts expense. (The company uses the perpetual inventory system and it applies the allowance method for its accounts receivable.) (Round your intermediate calculations to the nearest dollar amount.)
In: Accounting
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In: Accounting
XYZ has been experiencing losses on its Widget line for several years. Here is the most recent contribution margin statement:
| Sales | 850,000 | |
| VC: | ||
| Variable Manufacturing | 330,000 | |
| Sales Commissions | 42,000 | |
| Shipping | 18,000 | |
| Total VC | 390,000 | |
| Contribution Margin | 460,000 | |
| FC: | ||
| Advertising (traceable) | 270,000 | |
| Depreciation (no resale) | 80,000 | |
| General Factory OH | 105,000 | |
| Product Manger Salary | 32,000 | |
| Insurance on Inventory | 8,000 | |
| Purchasing Department | 45,000 | |
| Total FC | 540,000 | |
| Net Op Loss | (80,000) |
The general factory overhead is a common cost allocated on the basis of machine hours
The Purchasing department is a common cost allocated on the basis of sales dollars.
What is the total relevant costs in the decision to drop this line?
In: Accounting
The budget director for Campbell Cleaning Services prepared the following list of expected selling and administrative expenses. All expenses requiring cash payments are paid for in the month incurred except salary expense and insurance. Salary is paid in the month following the month in which it is incurred. The insurance premium for six months is paid on October 1. October is the first month of operations; accordingly, there are no beginning account balances.
Required
Complete the schedule of cash payments for S&A expenses by filling in the missing amounts.
Determine the amount of salaries payable the company will report on its pro forma balance sheet at the end of the fourth quarter.
Determine the amount of prepaid insurance the company will report on its pro forma balance sheet at the end of the fourth quarter.
| October | November | December | |
| Budgeted S&A Expenses | |||
| Equipment lease expense | $5,700 | $5,700 | $5,700 |
| Salary Expense | 6,000 | 6,500 | 6,900 |
| Cleaning Supplies | 2,830 | 2,720 | 3,020 |
| Insurance expense | 1,000 | 1,000 | 1,000 |
| Depreciation on computer | 1,500 | 1,500 | 1,500 |
| Rent | 2,000 | 2,000 | 2,000 |
| Miscellaneous expenses | 650 | 650 | 650 |
| Total operating expenses | $19,680 | $20,070 | $20,770 |
| Schedule of Cash Payments for S&A Expenses | |||
| Equipment lease expense | |||
| Prior month's salary expense, 100% | |||
| Cleaning Supplies | |||
| Insurance Premium | |||
| Depreciation on computer | |||
| Rent | |||
| Miscellaneous expenses | |||
| Total disbursements for operating expenses |
In: Accounting
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In: Accounting