"Inventory Costing Methods" Please respond to the following: Complete the e-Activity. Next, imagine that you have been hired as the production manager of a manufacturing company and must determine the best inventory costing system to implement. Discuss the key factors that must be considered before making the determination. Provide specific details and a rationale for your decision. As a production manager, one of your key tasks is to improve efficiencies by either increasing productivity or reducing cost. Determine whether the responsibility reports needed to track performance should be created by department, function, or manager, using a costing method of your choice. Based on the costing method you selected, determine the type of data needed to track and evaluate performance to control costs such as cost per unit, cost per hour, etc. Be specific with your examples.

6.11 A stock index is currently 990, the risk-free rate is 5%, and the dividend yield on the index is 2%. Use a three-step tree to value an 18-month American put option with a strike price of 1,000 when the volatility is 20% per annum. How much does the option holder gain by being able to exercise early? When is the gain made?

Fields Company has two manufacturing departments, forming and painting. The company uses the weighted-average method of process costing. At the beginning of the month, the forming department has 31,500 units in inventory, 75% complete as to materials and 25% complete as to conversion costs. The beginning inventory cost of $73,100 consisted of $52,600 of direct materials costs and $20,500 of conversion costs.

During the month, the forming department started 430,000 units. At the end of the month, the forming department had 30,000 units in ending inventory, 85% complete as to materials and 35% complete as to conversion. Units completed in the forming department are transferred to the painting department.

Cost information for the forming department follows.

1. Calculate the equivalent units of production for the forming department.
2. Calculate the costs per equivalent unit of production for the forming department.
3. Using the weighted-average method, assign costs to the forming department’s output—specifically, its units transferred to painting and its ending work in process inventory.

"Compensation and Lending Decisions" Please respond to the following: Compare and contrast compensation plans, such as restricted stock and stock appreciation rights, indicating the key differences with the accounting treatment. Determine the option that would have the least impact on a company's earnings. Recommend the choice that is the most advantageous to an employee. Support your position with examples. Given the current regulatory environment for financial institutions, analyzing financial statement information is an important process and at the same time, the massive amount of information that creditors have to sort through can become unwieldy. Review the financial ratios in the text, and choose three or four that creditors would mostly likely use to make their lending decisions. Indicate a rationale for choosing each ratio. Discuss at least three ways that management might manipulate the financial data to guarantee that the lending decision will be made in its favor. Provide specific examples.

Arborista, Inc. plants trees and shrubs for homeowners. The trees are purchased from and delivered by a sister company, Trees-R-Us, Inc.; Arborista specializes in planting. Arborista obtained capital from family members in exchange for common stock, which provides an ownership interest to the family members. On December 1, a total of $50,000 was

raised by issuing 10,000 shares of stock.

An additional $20,000 was borrowed from their hometown bank, also on December 1. The principal must be repaid at the end of two years, along with 6 percent interest annually, which accrues as time passes.

Also on December 1, Arborista took delivery of, and began using in the business, two previously owned Ford F-250 pick-ups for which it paid cash of $7,000 each. These trucks areexpected to last for five more years, and the best guess is that each will be worth $1,000 at the endof the five-year period.

Arborista hired two employees to do the planting: Frank and Francois. Frank is extremely knowledgeable, but a bit taciturn. Francois is generally ebullient and has a lovely accent, and so his services were in high demand by the customers of his former employer. As a result of his popularity,

Francois negotiated a deal with Arborista that he will be paid in advance for every job (i.e., at the time the job is scheduled). Frank is happy to follow the more generally accepted method of being paid after he does the work. The employees furnish their own tools (i.e., shovels and picks).

Arborista decides to charge $75 for planting each tree. The worker planting the tree (i.e., Frank or Francois) will receive $20 per tree as his wage.

On December 18, two clients came into the office to arrange to have trees planted on their property. The first client, Ms. Imaprimadonna, was insistent that her 20 trees/shrubs be planted the next day, as it was critical that the work be completed before the holidays. Furthermore, she insisted

that Frank do the planting, as she had heard Francois was the chatty type and she did not want to pay someone to chat. In addition, she insisted that Frank must arrive at her house before the clock truck 8:00 a.m., or the order was cancelled. Finally, Ms. Imaprimadonna insisted that she be billed

for the job and allowed to pay in three weeks.

The second client, Ms. Bonappetit, wanted 30 trees/shrubs planted. She was flexible about when the work would be completed, as long as it was scheduled after the first of the year. However, she did ask that Francois do the work, as she had heard wonderful things about his charming manner from her friend. Ms. Bonappetit insisted on paying in advance, and immediately wrote a check for the total amount. Arborista scheduled Francois to do the work in four weeks and, per their

agreement, paid him immediately.

Frank arrived at Ms. Imaprimadonna’s home at 7:59 a.m. on December 19 and completed the planting to her satisfaction. His next payday is January 5. Ms. Imaprimadonna paid promptly on January 8. Francois performed the work for Ms. Bonappetit on January 15. Both customers promised to recommend Arborista, Inc. to their friends.

Required

Prepare a Balance Sheet, Income Statement, and Statement of Cash Flows as of December 31 in excel.

In the month of March, Style Salon services 570 clients at an average price of $ 190 . During the month, fixed costs were $ 33,288 and variable costs were 60 % of sales. Determine the contribution margin in dollars, per unit, and as a ratio. (Round answers to 0 decimal places, e.g. 1,225.)

Contribution margin $enter a dollar amount rounded to 0 decimal places/

Contribution margin per unit $enter a dollar amount rounded to 0 decimal places

Contribution margin ratio enter a percentage number rounded to 0 decimal places % eTextbook and Media

Using the contribution margin technique, compute the break-even point in dollars and in units. (Round answers to 0 decimal places, e.g. 1,225.)

Break-even sales $enter the break-even point in dollars rounded to 0 decimal places

Break-even sales enter the break-even point in units rounded to 0 decimal places units

Single Plantwide Factory Overhead Rate

Salty Sensations Snacks Company manufactures three types of snack foods: tortilla chips, potato chips, and pretzels. The company has budgeted the following costs for the upcoming period:

Factory overhead is allocated to the three products on the basis of processing hours. The products had the following production budget and processing hours per case:

If required, round all per-case answers to the nearest cent.

a. Determine the single plantwide factory overhead rate.
$ per processing hour

b. Use the factory overhead rate in (a) to determine the amount of total and per-case factory overhead allocated to each of the three products under generally accepted accounting principles.

analyze the reasons why the short-term project that you have chosen might be ranked higher under the NPV criterion if the cost of capital is high, while the long-term project might be deemed better if the cost of capital is low. Determine whether or not changes in the cost of capital could ever cause a change in the internal rate of return (IRR) ranking of two (2) projects.

Tami Tyler opened Tami’s Creations, Inc., a small manufacturing company, at the beginning of the year. Getting the company through its first quarter of operations placed a considerable strain on Ms. Tyler’s personal finances. The following income statement for the first quarter was prepared by a friend who has just completed a course in managerial accounting at State University.

Ms. Tyler is discouraged over the loss shown for the quarter, particularly because she had planned to use the statement as support for a bank loan. Another friend, a CPA, insists that the company should be using absorption costing rather than variable costing and argues that if absorption costing had been used the company probably would have reported at least some profit for the quarter.

At this point, Ms. Tyler is manufacturing only one product—a swimsuit. Production and cost data relating to the swimsuit for the first quarter follow:

Required:

1. Complete the following:

a. Compute the unit product cost under absorption costing.

b. What is the company’s absorption costing net operating income (loss) for the quarter? (Round your intermediate calculations to 2 decimal places.)

c. Reconcile the variable and absorption costing net operating income (loss) figures. (Losses and deductions should be entered as a negative.)

3. During the second quarter of operations, the company again produced 33,100 units but sold 38,100 units. (Assume no change in total fixed costs.)

a. What is the company’s variable costing net operating income (loss) for the second quarter?

b. What is the company’s absorption costing net operating income (loss) for the second quarter?

c. Reconcile the variable costing and absorption costing net operating incomes for the second quarter.

On January 27, 2015, ALFA purchased 900,000 of its own shares of stock in the open market for 34 SR per share. Then on February 18, 2015 sold 400,000 shares for 23 SR per share.

Iguana, Inc., manufactures bamboo picture frames that sell for $25 each. Each frame requires 4 linear feet of bamboo, which costs $2.00 per foot. Each frame takes approximately 30 minutes to build, and the labor rate averages $12 per hour. Iguana has the following inventory policies:

• Ending finished goods inventory should be 40 percent of next month’s sales.
• Ending raw materials inventory should be 30 percent of next month’s production.

Expected unit sales (frames) for the upcoming months follow:   

Variable manufacturing overhead is incurred at a rate of $0.20 per unit produced. Annual fixed manufacturing overhead is estimated to be $8,400 ($700 per month) for expected production of 6,000 units for the year. Selling and administrative expenses are estimated at $750 per month plus $0.50 per unit sold.

     Iguana, Inc., had $14,800 cash on hand on April 1. Of its sales, 80 percent is in cash. Of the credit sales, 50 percent is collected during the month of the sale, and 50 percent is collected during the month following the sale.

     Of raw materials purchases, 80 percent is paid for during the month purchased and 20 percent is paid in the following month. Raw materials purchases for March 1 totaled $4,500. All other operating costs are paid during the month incurred. Monthly fixed manufacturing overhead includes $280 in depreciation. During April, Iguana plans to pay $4,300 for a piece of equipment.

1. Compute the budgeted cash receipts for Iguana. (Do not round your intermediate calculations. Round final answers to 2 decimal places.)

2. Compute the budgeted cash payments for Iguana. (Do not round your intermediate calculations. Round final answers to 2 decimal places.)

3. Prepare the cash budget for Iguana. Assume the company can borrow in increments of $1,000 to maintain a $14,000 minimum cash balance

When reading a legal text, the first rule to apply is the:

Literal Rule.

Golden Rule.

Mischief Rule.

Class Rule.

Discuss the model that you believe best fits the reality of the firm you are analysing and why. E...

Discuss the model that you believe best fits the reality of the firm you are analysing and why. Explain how you estimate the future growth of the firm.

Example model: FCFE model. DDM model and fundamental model. The firm is BASF (German chemical company and the largest chemical producer in the world).

Typed the answers please.