The Gourmand Cooking School runs short cooking courses at its small campus. Management has identified two cost drivers it uses in its budgeting and performance reports—the number of courses and the total number of students. For example, the school might run two courses in a month and have a total of 63 students enrolled in those two courses. Data concerning the company’s cost formulas appear below:

For example, administrative expenses should be $3,800 per month plus $44 per course plus $3 per student. The company’s sales should average $860 per student.

The company planned to run four courses with a total of 63 students; however, it actually ran four courses with a total of only 57 students. The actual operating results for September appear below:

Required:

Prepare a flexible budget performance report that shows both revenue and spending variances and activity variances for September. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.)

1. Schultz Clinic uses patient-visits as its measure of activity. The clinic bases its budgets on the following information: Revenue should be $40 per patient-visit. Personnel expenses should be $30,000 per month plus $11 per patient-visit. Medical supplies should be $1,000 per month plus $8 per patient-visit. Occupancy expenses should be $10,000 per month plus $1 per patient-visit. Administrative expenses should be $6,000 per month plus $1 per patient-visit.

The clinic reported the following actual results for February:

Prepare a report showing the clinic's revenue and spending variances for February. Label each variance as favorable (F) or unfavorable (U).

1. The following information is for Nichols Company: Selling price $120 per unit Variable costs $50 per unit Total fixed costs $300,000 What is the contribution margin per unit?

2. The following information is for Nichols Company: Selling price $110 per unit Variable costs $80 per unit Total fixed costs $310,000 What is the operating income if 10,000 units are sold?

3. The following information is for Nichols Company: Selling price $120 per unit Variable costs $90 per unit Total fixed costs $315,000 What is the break-even point?  

4. The following information is for Nichols Company: Selling price $130 per unit Variable costs $60 per unit Total fixed costs $315,000 How many units need to be sold to achieve an operating income of $157500?

Walsh Company manufactures and sells one product. The following information pertains to each of the company’s first two years of operations:

During its first year of operations, Walsh produced 50,000 units and sold 40,000 units. During its second year of operations, it produced 40,000 units and sold 50,000 units. The selling price of the company’s product is $59 per unit.

Required:

1. Assume the company uses variable costing:

a. Compute the unit product cost for Year 1 and Year 2.

b. Prepare an income statement for Year 1 and Year 2.

2. Assume the company uses absorption costing:

a. Compute the unit product cost for Year 1 and Year 2.

b. Prepare an income statement for Year 1 and Year 2.

3. Reconcile the difference between variable costing and absorption costing net operating income in Year 1.

Sally-Anne is considering starting a business and is not sure what type of structure to use. She estimates that the annual turnover for the 2020 tax year will be $525,000 and the (taxable) net profit will be $183,000. Both Sally-Anne and her husband have private health insurance.

Calculate (showing workings) the tax she would have to pay if she sets up the business as:

a. A sole trader (no other income)

b. A partnership 50/50 with her husband (neither earn any other income)

c. A company (1 mark)

d. Advise her on which would be the best structure based on total tax payable only. (1 mark)

e. Describe 3 distinctive features of a partnership. (1.5 marks)

f. Describe 3 distinctive features of a company. (1.5 marks)

g. Given the current volatility in the economic climate, Sally-Anne is concerned about what would happen if her business collapsed. Explain her legal liability with each structure listed above and advise which structure would give her the best protection for her personal assets. (2.5 marks)

Strategies to Communicate Organization Mission
1.) How do you communicate your organization's mission inside and outside the organizational walls?
2.) What strategies do you use to accomplish that?

Use Tax table and tax rate schedule as of september 2019

Determine the amount of tax liability in each of the following instances:

Use the appropriate Tax Tables and Tax Rate Schedules.

1. A married couple filing jointly with taxable income of $33,091.
2. A married couple filing jointly with taxable income of $193,759.
3. A married couple filing separately, one spouse with taxable income of $43,985 and the other with $56,318.
4. A single person with taxable income of $79,536.
5. A single person with taxable income of $300,025.
6. A head of household with taxable income of $96,692.
7. A qualifying widow with taxable income of $15,710.
8. A married couple filing jointly with taxable income of $11,316.

(For all requirements, use the Tax Tables for taxpayers with taxable income under $100,000 and the Tax Rate Schedules for those with taxable income above $100,000.)

a. A married couple filing jointly with taxable income of $33,091.
b. A married couple filing jointly with taxable income of $193,759. (Round your intermediate computations to 2 decimal places and final answer to the nearest dollar amount.)

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c. A married couple filing separately, one spouse with taxable income of $43,985 and the other with $56,318.

d. A single person with taxable income of $79,536.
e. A single person with taxable income of $300,025. (Round your intermediate computations to 2 decimal places and final answer to the nearest dollar amount.)
f. A head of household with taxable income of $96,692.
g. A qualifying widow with taxable income of $15,710.
h. A married couple filing jointly with taxable income of $11,316.

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Sonic Inc. manufactures two models of speakers, Rumble and Thunder. Based on the following production and sales data for June, prepare (a) a sales budget and (b) a production budget:

a. Prepare a sales budget.

b. Prepare a production budget. For those boxes in which you must enter subtracted or negative numbers use a minus sign.

Break-Even in Units, After-Tax Target Income, CVP Assumptions

Campbell Company manufactures and sells adjustable canopies that attach to motor homes and trailers. The market covers both new unit purchases as well as replacement canopies. Campbell developed its business plan for the year based on the assumption that canopies would sell at a price of $400 each. The variable costs for each canopy were projected at $200, and the annual fixed costs were budgeted at $120,000. Campbell’s after-tax profit objective was $216,000; the company’s effective tax rate is 40 percent.

While Campbell’s sales usually rise during the second quarter, the May financial statements reported that sales were not meeting expectations. For the first five months of the year, only 350 units had been sold at the established price, with variable costs as planned, and it was clear that the after-tax profit projection for the year would not be reached unless some actions were taken. Campbell’s president assigned a management committee to analyze the situation and develop several alternative courses of action. The following mutually exclusive alternatives, labeled A, B, and C, were presented to the president:

A. Lower the variable costs per unit by $25 through the use of less expensive materials and slightly modified manufacturing techniques. The sales price will also be reduced by $30, and sales of 2,200 units for the remainder of the year are forecast.

B. Reduce the sales price by $40. The sales organization forecasts that with the significantly reduced sales price, 2,700 units can be sold during the remainder of the year. Total fixed and variable unit costs will stay as budgeted.

C. Cut fixed costs by $10,000, and lower the sales price by 5 percent. Variable costs per unit will be unchanged. Sales of 2,000 units are expected for the remainder of the year.

Required:

1. Determine the number of units that Campbell Company must sell in order to break even assuming no changes are made to the selling price and cost structure.
units

2. Determine the number of units that Campbell Company must sell in order to achieve its after-tax profit objective.
units

3. Determine which one of the alternatives Campbell Company should select to achieve its annual after-tax profit objective.

Be sure to support your selection with appropriate calculations.

• Estimate the product costs is for Fitbit.In 2018, we focused on providing more choice and accessibility to consumers in wearables to drive acquisition of users. We introduced Fitbit Versa, our first mass appeal smartwatch in the second quarter, resulting in increased smartwatch revenue over the course of 2018. Smartwatch revenue increased to 44% of revenue in 2018, from 8% in 2017. We also launched Fitbit Charge 3, which innovates on our Charge family of trackers, and which has sold more than 38 million devices. It gives people health and fitness features in a slim, premium tracker design, with smart functionality, and long battery life at an affordable price. The introduction of Fitbit Ace, a tracker designed for kids ages 8 and up and Fitbit family accounts, also expanded our addressable market.

• Do the costs described include direct materials, direct labor, and manufacturing overhead?
• Are any product costs missing from these analyses?
• Discuss how you would try to determine direct materials, direct labor, overhead costs.
• Are there other costs that are not considered?
• Which product costing method do you think is appropriate for the product you chose and why?
• Are you outraged by the product mark-up?

The Board of Directors of Gold Structures Inc. is receiving the 2016 annual Report. A new board member-a wealthy woman with little business experience -questions the company's accountant about depreciation amounts. The new board member wonders why the depreciation expense has decreased from R220 000 in 2014 to R204 000 in 2015 and R196 000 in 2016. She states that she could understand the decreasing annual amounts if the company had been disposing of properties each year, but that did not occur. Further, she notes that the growth in the city is increasing the values of the company properties.

Required:

Prepare a response to the new board member's concerns. Also indicate why the company is recording depreciation when the property values are increasing?