| Garcon | Pepper | |
| Beginning finished goods inventory | 14,800 | 19,750 |
| Beginning work in process inventory | 15,600 | 19,650 |
| Beginning raw materials inventory | 7,800 | 14,400 |
| Rental cost on factory equipment | 31,000 | 24,100 |
| Direct labor | 23,800 | 44,600 |
| Ending finished goods inventory | 18,500 | 16,500 |
| Ending work in process inventory | 26,500 | 17,800 |
| Ending raw materials inventory | 6,800 | 9,800 |
| Factory utilities | 13,500 | 12,250 |
| Factory supplies used | 12,400 | 4,900 |
| General and administrative expenses | 33,000 | 45,000 |
| Indirect labor | 2,150 | 7,660 |
| Repairs—Factory equipment | 6,260 | 2,450 |
| Raw materials purchases | 41,000 | 57,500 |
| Selling expenses | 52,400 | 51,700 |
| Sales | 222,030 | 342,510 |
| Cash | 29,000 | 19,700 |
| Factory equipment, net | 267,500 | 145,825 |
| Accounts receivable, net | 14,800 | 20,950 |
| Please calculate cost of goods sold, also indicate all the necessary steps clearly. Thanks | ||
In: Accounting
During the month of January 2015 the following transactions took place:
Jan. 20 Michael McBryan and family invested $80,000 cash in exchange for capital stock.
Jan. 21 On January 21, Overnight Auto Service (Michael McBryan) purchased the land from the city for $52,000 cash.
Jan. 22 Overnight completed the acquisition of its business location by purchasing the abandoned building from the MTA. The purchase price was $36,000; Overnight made a $6,000 cash down payment and issued a 90-day, non-interest-bearing note payable for the remaining $30,000.
Jan. 23 Overnight purchased tools and equipment on account from Snappy Tools. The purchase price was $13,800, due in 60 days.
Jan. 24 Overnight found that it had purchased more tools than it needed. On January 24, it sold the excess tools on account to Ace Towing at a price of $1,800. The tools were sold at a price equal to their cost, so there was no gain or loss on this transaction.
Jan. 26 Overnight received $600 in partial collection of the account receivable from Ace Towing.
Jan. 27 Overnight made a $6,800 partial payment of its account payable to Snappy Tools.
Prepare the journal entries, the general ledger and the balance sheet of Overnight as of January 31, 2015.
In: Accounting
Superior Company provided the following account balances for the year ended December 31 (all raw materials are used in production as direct materials):
| Selling expenses | $ | 216,000 |
| Purchases of raw materials | $ | 260,000 |
| Direct labor | ? | |
| Administrative expenses | $ | 150,000 |
| Manufacturing overhead applied to work in process | $ | 372,000 |
| Total actual manufacturing overhead costs | $ | 359,000 |
| Inventory balances at the beginning and end of the year were as follows: |
| Beginning of Year | End of Year | |||||
| Raw materials | $ | 59,000 | $ | 40,000 | ||
| Work in process | ? | $ | 32,000 | |||
| Finished goods | $ | 31,000 | ? | |||
|
The total manufacturing costs for the year were $690,000; the cost of goods available for sale totaled $720,000; the unadjusted cost of goods sold totaled $664,000; and the net operating income was $40,000. The company’s overapplied or underapplied overhead is closed entirely to Cost of Goods Sold. |
| Required: |
| a. | Prepare a schedule of cost of goods manufactured. |
| b. |
Prepare a schedule of cost of goods sold. |
| c. |
Prepare an income statement for the year. |
In: Accounting
|
Andretti Company has a single product called a Dak. The company normally produces and sells 89,000 Daks each year at a selling price of $60 per unit. The company’s unit costs at this level of activity are given below: |
|
Direct materials |
$ |
9.50 |
|
|
Direct labor |
10.00 |
||
|
Variable manufacturing overhead |
3.50 |
||
|
Fixed manufacturing overhead |
7.00 |
($623,000 total) |
|
|
Variable selling expenses |
2.70 |
||
|
Fixed selling expenses |
4.00 |
($356,000 total) |
|
|
Total cost per unit |
$ |
36.70 |
|
| Required: | |
| 1-a. |
Assume that Andretti Company has sufficient capacity to produce 111,250 Daks each year without any increase in fixed manufacturing overhead costs. The company could increase its unit sales by 25% above the present 89,000 units each year if it were willing to increase the fixed selling expenses by $110,000. What is the financial advantage (disadvantage) of investing an additional $110,000 in fixed selling expenses?. (Round all dollar amounts to 2 decimal places.) |
| A number of questions relating to the production and sale of Daks follow. Each question is independent. |
| 1-b. | Would the increased fixed selling expenses be justified? | ||||
|
| 2. |
Assume again that Andretti Company has sufficient capacity to produce 111,250 Daks each year. A customer in a foreign market wants to purchase 22,250 Daks. If Andretti accepts this order it would have to pay import duties on the Daks of $3.70 per unit and an additional $17,800 for permits and licenses. The only selling costs that would be associated with the order would be $1.50 per unit shipping cost. What is the break-even price per unit on this order? (Round your answers to 2 decimal places.) |
| 3. |
The company has 500 Daks on hand that have some irregularities and are therefore considered to be "seconds." Due to the irregularities, it will be impossible to sell these units at the normal price through regular distribution channels. What unit cost figure is relevant for setting a minimum selling price? (Round your answer to 2 decimal places.) |
| 4. |
Due to a strike in its supplier’s plant, Andretti Company is unable to purchase more material for the production of Daks. The strike is expected to last for two months. Andretti Company has enough material on hand to operate at 25% of normal levels for the two-month period. As an alternative, Andretti could close its plant down entirely for the two months. If the plant were closed, fixed manufacturing overhead costs would continue at 40% of their normal level during the two-month period and the fixed selling expenses would be reduced by 20%. a. How much total contribution margin will Andretti forgo if it closes the plant for two months? b. How much total fixed cost will the company avoid if it closes the plant for two months? c. What is the financial advantage (disadvantage) of closing the plant for the two-month period? d. Should Andretti close the plant for two months? (Enter losses/reductions with a minus sign. Round all calculations (intermediate and final) to whole numbers. Round unit calculations to whole numbers.) |
| 5. |
An outside manufacturer has offered to produce 89,000 Daks and ship them directly to Andretti’s customers. If Andretti Company accepts this offer, the facilities that it uses to produce Daks would be idle; however, fixed manufacturing overhead costs would be reduced by 30%. Because the outside manufacturer would pay for all shipping costs, the variable selling expenses would be only two-thirds of their present amount. What is Andretti’s avoidable cost per unit that it should compare to the price quoted by the outside manufacturer? (Do not round intermediate calculations. Round your answer to 2 decimal places.) |
In: Accounting
During December of the current year, Teletex Systems, Inc., a company based in Seattle, Washington, entered into the following transactions:
Dec. 10 Sold seven office computers to a company located in Colombia for 8,778,000 pesos. On this date, the spot rate was 380 pesos per U.S. dollar.
Dec. 12 Purchased computer chips from a company domiciled in Taiwan. The contract was denominated in 510,000 Taiwan dollars.
The direct exchange spot rate on this date was $0.039.
Prepare journal entries necessary to adjust the accounts as of December 31. Assume that on December 31 the direct exchange rates were as follows:
| Colombia peso | $0.00259 | |
| Taiwan dollar | $0.0350 |
In: Accounting
Two independent companies, Bayer and Monsanto are in the chemical and pharmaceutical industries. Each owns a piece of laboratory equipment used in research and development of new products, but each would like the other firm’s equipment. They agree to exchange the equipment. An appraiser was hired, and from her report and the companies' records, the following information was obtained: Bayer’s Equipment Monsanto's Equipment Cost $826,000 $460,000 Accumulated depreciation $250,000 $100,000 Fair value based upon appraisal $720,000 $630,000 The exchange was made and based on the difference in appraised fair values. Monsanto paid $90,000 to Bayer.
1 a Prepare the entries on both companies' books assuming the exchange had no commercial substance.
1 b Also prepare the journal entries on both companies’ books assuming the exchange had commercial substance.
In: Accounting
Lance-Hefner Specialty Shoppes decided to use the dollar-value LIFO retail method to value its inventory. Accounting records provide the following information:
| Cost | Retail | |||||
| Merchandise inventory, January 1, 2018 | $ | 192,000 | $ | 320,000 | ||
| Net purchases | 371,200 | 575,000 | ||||
| Net markups | 14,000 | |||||
| Net markdowns | 9,000 | |||||
| Net sales | 460,000 | |||||
Related retail price indexes are as follows:
| January 1, 2018 | 1.00 |
| December 31, 2018 | 1.10 |
Required:
Ending inventory at retail:____
Ending inventory at cost:____
Cost of Goods sold:____
In: Accounting
Mayfair Co. allows select customers to make purchases on credit. Its other customers can use either of two credit cards: Zisa or Access. Zisa deducts a 3.0% service charge for sales on its credit card. Access deducts a 2.0% service charge for sales on its card. Mayfair completes the following transactions in June.
| June | 4 | Sold $600 of merchandise on credit (that had cost $300) to Natara Morris terms n/30. | ||
| 5 | Sold $6,200 of merchandise (that had cost $3,100) to customers who used their Zisa cards. | |||
| 6 | Sold $5,786 of merchandise (that had cost $2,893) to customers who used their Access cards. | |||
| 8 | Sold $4,930 of merchandise (that had cost $2,465) to customers who used their Access cards. | |||
| 13 | Wrote off the account of Abigail McKee against the Allowance for Doubtful Accounts. The $549 balance in McKee’s account stemmed from a credit sale in October of last year. | |||
| 18 | Received Morris’s check in full payment for the purchase of June 4. |
Required:
Prepare journal entries to record the preceding transactions and
events. (The company uses the perpetual inventory system.)
(If no entry is required for a transaction/event, select
"No journal entry required" in the first account field. Round your
final answers to the nearest whole dollar.)
| No | Date | General Journal | Debit | Credit |
|---|---|---|---|---|
In: Accounting
Kansas Instruments manufactures two models of pocket calculators. Per unit of the Basic model sells for $5.50, has direct material cost of $1.25 and requires 0.25 hours of labour to produce. Each calculator of the Scientist model sells for $7.50, has direct material cost of $1.63 and takes 0.375 hours to produce.
Each labour hour costs Kansas Instruments $6 and labour is currently very scarce, even though the demand for the company’s calculators is very high. The company is currently producing 8,000 Basic calculators and 4,000 Scientist calculators each month. Fixed costs per month amount to $24,000.
Kansas Instruments has received a request from an overseas potential customer to manufacture a batch of calculators made to specific requirements. The overseas customer is offering the company a contract worth $35,000 for this order. The production manager has estimated the following facts with respect to this special order:
• The labour time required for this contract would be 1,200
hours.
• The material cost would be $9,000 (excluding the cost of a
special component not normally used by the company for
manufacturing its regular calculators).
• The special components could either be purchased from a supplier
for $2,500 or produced internally using materials that would cost
$1,000 and additional labour time of 150 hours.
Required:
Advise the management of Kansas Instruments on the appropriate course of action.
In: Accounting
Holl Corporation has provided the following data for November. Denominator level of activity 5,500 machine-hours Budgeted fixed manufacturing overhead costs $ 68,750 Standard machine-hours allowed for the actual output 5,800 machine-hours Actual fixed manufacturing overhead costs $ 67,650 Required: a. Compute the budget variance for November. b. Compute the volume variance for November. (Input all amounts as positive values.)
Budget Variance: ______ ______
Volume Variance: _______ _______
In: Accounting
Decision support is defined as any combination of learning activities designed to facilitate the personal diagnosis, treatment, self-management, and cure of illness. Describe the scientific rationale for this Definition?
In: Accounting
1. An aging schedule shows a required balance in Allowance for Doubtful Accounts of $9,500. If there is a credit balance in the allowance account of $3,500 prior to adjustment, the adjustment amount is $6,000.
True
False
2. The maturity value of a $5,000 note is $5,250. If $100 of the interest has been accrued prior to maturity, the entry at maturity should include a credit to Interest Income for $150.
True
False
3. Allowance for Doubtful Accounts is an expense account, and its normal balance is debit.
True
False
4. The principal amount of a 12%, 3-year, note receivable is $300,000 and is dated January 1, 2017. The interest income to be recognized on December 31, 2017 is $12,000.
True
False
5. When a non-current asset is disposed of before full depreciation, a loss occurs.
True
False
6. Cost of goods sold is the difference between cost of goods available for sale and ending inventory.
True
False
In: Accounting
The following data pertaining to the cash transactions
and bank account of Kim Company for September, Year 4, are
available to you:
Cash balance per accounting records , Sep 30 Year
4
Sh67,500
Cash balance per accounting bank statement, Sep 30 Year
4
308,383
Bank service charge for
September
1,100
Debit memo for printed cheques delivered by the
bank
300
Deposit of Sep 30 not recorded by bank until Oct
1
48,700
Outstanding cheques, Sep 30, Year
4
81,283
Proceeds of a bank loan on Sep 30 not recorded in the accounting
records
( interest payable on
maturity)
300,000
Proceeds from Note Receivable , principal amount
sh8,000
8,100
Cheque no 1012 to a creditor entered in the accounting records as
sh 18,791;
Deducted in the bank statement in the correct
amount
17,891
Stolen cheque lacking an authorized signature deducted from Kim’s
account in
Error
86,700
Cheque from a debtor returned by the bank marked
NSF
12,600
Required:
Prepare a bank reconciliation as at September 30, Year 4
Prepare journal entry(ies) to adjust the accounting
records
In: Accounting
E10-5 Calculating Return on Investment, Residual Income, Determining Effect of Changes in Sales, Expenses, Invested Assets, Hurdle Rate on Each [LO 10-4, 10-5]
Solano Company has sales of $520,000, cost of goods sold of
$380,000, other operating expenses of $51,000, average invested
assets of $1,650,000, and a hurdle rate of 8 percent.
Required:
1. Determine Solano’s return on investment (ROI),
investment turnover, profit margin, and residual income.
(Do not round your intermediate calculations. Enter your
ROI and Profit Margin percentage answer to the nearest 2 decimal
places, (i.e., 0.1234 should be entered as 12.34%). Round your
Investment Turnover answer to 4 decimal places.)
2. Several possible changes that Solano could face
in the upcoming year follow. Determine each scenario’s impact on
Solano’s ROI and residual income. (Note: Treat each scenario
independently.) (Enter your ROI percentage answers to 2
decimal places, (i.e., 0.1234 should be entered as
12.34%.))
a. Company sales and cost of
goods sold increase by 40 percent.
b. Operating expenses
decrease by $10,500.
c. Operating expenses increase
by 20 percent.
d. Average invested assets
increase by $310,000.
e. Solano changes its
hurdle rate to 14 percent.
In: Accounting
Minden Company is a wholesale distributor of premium European Chocolates. The Company’s balance sheet as of April 30th is given below:
|
Assets |
Liabilities and SE |
||
|
Cash |
9,000 |
Accounts payable |
63,000 |
|
Accounts Receivable |
54,000 |
Note Payable |
14,500 |
|
Inventory |
30,000 |
Common stock |
180,000 |
|
Building and Equip, net of deprec |
207,000 |
Retained Earnings |
42,500 |
|
Total Assets |
300,000 |
Total Liabilities and SE |
300,000 |
The company is in the process of preparing a budget for May and has assembled the following data:
Sales are budgeted at $200,000 for May. Of these sales, $60,000 will be for cash; the remainder will be credit sales. One-half of a months credit sales are collected in the month the sales are made, and the remainder is collected in the following month. All of April 30 accounts receivable will be collected in May.
Purchases of Inventory are expected to total 120,000 during May. These purchases will all be on account. 40% of all purchases are paid for in the month of purchase; the remainder are paid the following month. All of the April 30 accounts payable to suppliers will be paid during May.
The May 31 inventory balance is budgeted at $40,000.
Selling and administrative expenses for May are budgeted at $72,000, exclusive of depreciation. These expenses will be paid in cash. Depreciation is budgeted at $2,000 for the month.
The note payable on the April 30th balance sheet will be paid during Mat, with $100 in interest. (All of the interest relates to May)
New refrigerating equipment costing $6,500 will be purchased for cash during May.
During May, the company will borrow $20,000 from its bank by giving a new note payable to the bank for that amount. The new note will be due in one year.
Required:
Calculate the expected cash collections for May.
Calculate the expected cash disbursements for merchandise purchases for May.
Prepare a cash budget for May
Using Schedule 9 as your guide, prepare a budgeted income statement for May
Prepare a budgeted balance sheet as of May 31
In: Accounting