Lamour Corporation is a job order costing company that uses activity-based costing to apply overhead to jobs. The following overhead activities were budgeted for the year.
Activity | Cost | Driver | Amount of driver |
Setups | $240,000 | Number of setups | 6,000 |
Purchasing | 160,000 | Number of parts | 20,000 |
Other overhead | 300,000 | Direct labor hours | 80,000 |
The following information about the jobs was given for April.
Job 101 | Job 102 | Job 103 | Job 104 | |
Balance 4/1 | $64,900 | $40,770 | $30,500 | 0 |
Direct materials | 54,000 | 37,900 | 25,000 | 11,000 |
Direct labor | 80,000 | 38,500 | 43,000 | 21,000 |
Number of setups | 40 | 10 | 30 | 200 |
Number of parts | 300 | 80 | 400 | 500 |
Direct labor hours | 5,000 | 2,400 | 5,200 | 1,200 |
By April 30, Jobs 102 and 103 were completed and sold. The
remaining jobs were still in process.
What is the cost of goods manufactured?
a.$ 249,610
b.$ 178,340
c.$ 215,670
d.$ 144,400
In: Accounting
Using the appropriate present value table and assuming a 12%
annual interest rate, determine the present value on December 31,
2018, of a five-period annual annuity of $7,700 under each of the
following situations: (FV of $1, PV of $1, FVA of $1, PVA of $1,
FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from
the tables provided.)
1.The first payment is received on December 31,
2019, and interest is compounded annually.
2.The first payment is received on December 31,
2018, and interest is compounded annually.
3.The first payment is received on December 31,
2019, and interest is compounded quarterly.
In: Accounting
In: Accounting
PROBLEM: Front Range Furniture expects to maintain the same inventories at the end of 2020 as at the beginning of the year. The total of all production costs for the year is assumed to be equal to the cost of goods sold. With this in mind, the various department heads were asked to submit estimates of the costs of their departments during the year. A summary report of these estimates is as follows:
Estimated variable cost Estimated Fixed cost
Production costs:
Direct material 50
Direct labor 30
Factory overhead 350,000
Selling Expense:
Sales salaries/ commission 4 340,000
Travel 4,000
Advertising 116,000
Miscellaneous Selling expenses 1 2,300
Administrative Expenses:
Management and office staff salaries 325,000
Office supplies 4 6,000
Misc. Administrative expenses 1 8,700
---------- --------------
$90 $1,152,000
It’s expected that 12,000 units will be sold at a price of $240 per unit. Maximum sales within the relevant range are 18,000.
Required: Complete the chart in your working papers to calculate total fixed and variable costs (see the Working Papers for more detailed instructions).
In: Accounting
Scenario
Wanda is relaxing after a long day of treat baking and turns on her tablet to check Facebook and see what all of her friends have been doing while she has been baking Chicken Cuties. While she is scrolling along, an ad pops up on the side of her page for “Woofables”—The Gourmet Dog Bakery. Wanda is stunned and immediately picks up her phone and starts texting you. Her first text is, “How dare they advertise their dog treats to me?” and the texts go downhill from there. Clearly, Wanda has not done much research regarding how her competition is marketing their products.
For Discussion
In: Accounting
The stockholders’ equity accounts of Bridgeport Company have the
following balances on December 31, 2020.
Common stock, $10 par, 298,000 shares issued and outstanding | $2,980,000 | |
Paid-in capital in excess of par—common stock | 1,280,000 | |
Retained earnings | 5,840,000 |
Shares of Bridgeport Company stock are currently selling on the
Midwest Stock Exchange at $35.
Prepare the appropriate journal entries for each of the following
cases. (Credit account titles are automatically
indented when amount is entered. Do not indent manually. If no
entry is required, select "No Entry" for the account titles and
enter 0 for the amounts.)
(a) | A stock dividend of 8% is (1) declared and (2) issued. | |
---|---|---|
(b) | A stock dividend of 100% is (1) declared and (2) issued. | |
(c) | A 2-for-1 stock split is (1) declared and (2) issued. |
No. |
Account Titles and Explanation |
Debit |
Credit |
---|---|---|---|
(a) (1) |
enter an account title for case A to record the declaration of stock dividends |
enter a debit amount |
enter a credit amount |
enter an account title for case A to record the declaration of stock dividends |
enter a debit amount |
enter a credit amount |
|
enter an account title for case A to record the declaration of stock dividends |
enter a debit amount |
enter a credit amount |
|
(a) (2) |
enter an account title for case A to record the issuance of stock dividends |
enter a debit amount |
enter a credit amount |
enter an account title for case A to record the issuance of stock dividends |
enter a debit amount |
enter a credit amount |
|
(b) (1) |
enter an account title for case B to record the declaration of stock dividends |
enter a debit amount |
enter a credit amount |
enter an account title for case B to record the declaration of stock dividends |
enter a debit amount |
enter a credit amount |
|
(b) (2) |
enter an account title for case B to record the issuance of stock dividends |
enter a debit amount |
enter a credit amount |
enter an account title for case B to record the issuance of stock dividends |
enter a debit amount |
enter a credit amount |
|
(c) (1) |
enter an account title for case C to record the declaration of the stock split |
enter a debit amount |
enter a credit amount |
enter an account title for case C to record the declaration of the stock split |
enter a debit amount |
enter a credit amount |
|
(c) (2) |
enter an account title for case C to record the issuance of the stock split |
enter a debit amount |
enter a credit amount |
enter an account title for case C to record the issuance of the stock split |
enter a debit amount |
enter a credit amount |
In: Accounting
Based on your future career in accounting, develop a scenario for managers, relevant to the accounting industry, illustrating which behaviors are ethical and which are not, then briefly discuss these. (2-3 examples which behaviors are ethical and 2-3 examples of unethical behaviors)
In: Accounting
Earned Income Credit:
For each of the following situations, compute the taxpayers’ 2019 earned income credit. A. Patty and Ron Barnett file a joint return, claiming their two sons, ages 3 and 5, as dependents. The Barnett’s AGI is $14,400, which consists entirely of Ron’s wages. B. Joseph is a 25-year-old graduate student. His gross income consists of $5,000 of wages and $80 in interest from a savings account. Joseph files as single and claims no dependents. C. Suzanne and Vernon Zimmerman file a joint return, claiming their 6-year-old daughter as a dependent. The Zimmermans’ AGI consists of Vernon’s $26,375 in wages, and $400 in dividend income. D. Sarah files as head of household, claiming her 2-year-old son as a dependent. Sarah’s AGI consists of $18,000 in wages and $3,620 in interest income.
In: Accounting
“Differentiate Between Value-Added and Non-Value-Added
activities?
What are two advantages and two criticisms of activity-based
costing?
Comment, Why ABC and ABM is Necessary in Manufacturing
Entity?
Explain Few Reasons.”
In: Accounting
The following is a December 31, 2018, post-closing trial balance for Culver City Lighting, Inc. Account Title Debits Credits Cash $ 68,000 Accounts receivable 52,000 Inventories 58,000 Prepaid insurance 28,000 Equipment 120,000 Accumulated depreciation—equipment $ 47,000 Patent, net 53,000 Accounts payable 18,500 Interest payable 8,500 Note payable (due in 10, equal annual installments) 140,000 Common stock 83,000 Retained earnings 82,000 Totals $ 379,000 $ 379,000 a. Calculate the current ratio. b. Calculate the acid-test ratio. c. Calculate the debt to equity ratio.
In: Accounting
BARDEEN ELECTRIC: FASB ASC AND IFRS RESEARCH CASE
On October 18, 2017, Armstrong Auto Corporation ("Armstrong") announced its plan to acquire 80 percent of the outstanding 500,000 shares of Bardeen Electric Corporation’s ("Bardeen") common stock in a business combination following regulatory approval. Armstrong will account for the transaction in accordance with ASC 805, “Business Combinations.” On December 1, 2017, Armstrong purchased an 80 percent controlling interest in Bardeen’s outstanding voting shares. On this date, Armstrong paid $40 million in cash and issued one million shares of Armstrong common stock to the selling shareholders of Bardeen. Armstrong’s share price was $26 on the announcement date and $24 on the acquisition date. Bardeen’s remaining 100,000 shares of common stock had been purchased for $3,000,000 by a small number of original investors. These shares have never been actively traded. Using other valuation techniques (comparable firms, discounted cash flow analysis, etc.), Armstrong estimated the fair value of Bardeen’s noncontrolling shares at $16,500,000. The parties agreed that Armstrong would issue to the selling shareholders an additional one million shares contingent upon the achievement of certain performance goals during the first 24 months following the acquisition. The acquisition-date fair value of the contingent stock issue was estimated at $8 million. Bardeen has a research and development (R&D) project underway to develop a superconductive electrical/magnetic application. Total costs incurred to date on the project equal $4,400,000. However, Armstrong estimates that the technology has a fair value of $11 million. Armstrong considers this R&D as in-process because it has not yet reached technological feasibility and additional R&D is needed to bring the project to completion. No assets have been recorded in Bardeen’s financial records for the R&D costs to date. Bardeen’s other assets and liabilities (at fair values) include the following:
Cash $ 425,000
Accounts receivable 788,000
Land 3,487,000
Building 16,300,000
Machinery 39,000,000
Patents 7,000,000
Accounts payable (1,500,000)
Neither the receivables nor payables involve Armstrong. Answer the following questions citing relevant support from the ASC and IFRS. 1. What is the total consideration transferred by Armstrong to acquire its 80 percent controlling interest in Bardeen?
2. What values should Armstrong assign to identifiable intangible assets as part of the acquisition accounting?
3. What is the acquisition-date value assigned to the 20 percent noncontrolling interest? What are the potential noncontrolling interest valuation alternatives available under IFRS?
4. Under U.S. GAAP, what amount should Armstrong recognize as goodwill from the Bardeen acquisition? What alternative goodwill valuations are allowed under IFRS?
In: Accounting
Neptune Company produces toys and other items for use in beach and resort areas. A small, inflatable toy has come onto the market that the company is anxious to produce and sell. The new toy will sell for $5.50 per unit. Enough capacity exists in the company’s plant to produce 20,000 units of the toy each month. Variable costs to manufacture and sell one unit would be $2.75, and fixed costs associated with the toy would total $70,000 per month.
The company’s Marketing Department predicts that demand for the new toy will exceed the 20,000 units that the company is able to produce. Additional manufacturing space can be rented from another company at a fixed cost of $5,000 per month. Variable costs in the rented facility would total $3.00 per unit, due to somewhat less efficient operations than in the main plant.
Required:
1. Compute the monthly break-even point for the new toy in units and in total dollar sales. Show all computations in good form.
2. How many units must be sold each month to make a monthly profit of $3,000?
3. If the sales manager receives a bonus of 5 cents for each unit sold in excess of the break-even point, how many units must be sold each month to earn a return of 4.9% on the monthly investment in fixed costs?
In: Accounting
Jacob is a member of WCC (an LLC taxed as a partnership). Jacob was allocated $55,000 of business income from WCC for the year. Jacob’s marginal income tax rate is 37 percent. The business allocation is subject to 2.9 percent of self-employment tax and 0.9 percent additional Medicare tax. (Round your intermediate calculations to the nearest whole dollar amount.)
a. What is the amount of tax Jacob will owe on the income allocation if the income is not qualified business income?
b. What is the amount of tax Jacob will owe on the income allocation if the income is qualified business income (QBI) and Jacob qualifies for the full QBI deduction?
In: Accounting
Each student should choose an organization with which she/he is familiar, such as the place of employment, business patronized, or other situation and describe how that organization either does or does not apply the course concepts on a day-to-day basis. The following course concepts should be discussed:
In: Accounting
What would be some pros and cons of using acutal versus capacity cost driver rates and vice versus. this is the question i am ultimately answering, "Which cost driver rates should be used: actual or capacity based? Why?"
In: Accounting