“[M]anagement take risks … but the processes that generate those … are somewhat removed from the classical processes of choosing from alternative actions in terms of expected value”.

Discuss this statement in 500 words

On September 1, the balance of the Accounts Receivable control account in the general ledger of Montgomery Company was $10,520. The customers’ subsidiary ledger contained account balances as follows: Hurley $1,450, Andino $2,290, Fowler $2,080, and Sogard $4,700. At the end of September, the various journals contained the following information. Sales journal: Sales to Sogard $750, to Hurley $1,100, to Giambi $1,360, and to Fowler $1,120. Cash receipts journal: Cash received from Fowler $1,370, from Sogard $2,130, from Giambi $330, from Andino $1,710, and from Hurley $1,190. General journal: An allowance is granted to Sogard $110. -Set up control and subsidiary accounts and enter the beginning balances. -Post the various journals. Post the items as individual items or as totals, whichever would be the appropriate procedure. -Prepare a schedule of accounts receivable and prove the agreement of the controlling account with the subsidiary ledger at September 30, 2017. -

Maxey & Sons manufactures two types of storage cabinets—Type A and Type B—and applies manufacturing overhead to all units at the rate of $112 per machine hour. Production information follows.

The controller, who is studying the use of activity-based costing, has determined that the firm’s overhead can be identified with three activities: manufacturing setups, machine processing, and product shipping. Data on the number of setups, machine hours, and outgoing shipments, which are the activities’ three respective cost drivers, follow.

The firm’s total overhead of $12,073,600 is subdivided as follows: manufacturing setups, $2,634,240; machine processing, $7,244,160; and product shipping, $2,195,200.

Required:

1. Compute the unit manufacturing cost of Type A and Type B storage cabinets by using the company’s current overhead costing procedures.

2. Compute the unit manufacturing cost of Type A and Type B storage cabinets by using activity-based costing.

3. Is the cost of the Type A storage cabinet overstated or understated (i.e., distorted) by the use of machine hours to allocate total manufacturing overhead to production? By how much?

4. Assume that the current selling price of a Type A storage cabinet is $332.50 and the marketing manager is contemplating a $38 discount to stimulate volume. Is this discount advisable?

Compute the unit manufacturing cost of Type A and Type B storage cabinets by using the company’s current overhead costing procedures.

Compute the unit manufacturing cost of Type A and Type B storage cabinets by using activity-based costing. (Round activity based application rates, overhead application and the final answers to 2 decimal places.)

• Is the cost of the Type A storage cabinet overstated or understated (i.e., distorted) by the use of machine hours to allocate total manufacturing overhead to production? By how much? (Do not round intermediate calculations. Round activity based application rates, overhead application and the final answers to 2 decimal places.)

  	Type A store cabinet line is

• Assume that the current selling price of a Type A storage cabinet is $332.50 and the marketing manager is contemplating a $38 discount to stimulate volume. Is this discount advisable?

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Q) Pepsi Cola Company wants to estimate the cost for each process. It is a beverage manufacturing unit and only produce different flavors of beverages.

Required:

a. Classify each of the following costs as either direct or indirect with respect to production process.

b. Classify each of the following costs as either fixed or variable with respect to Pepsi Cola Company per day.

Crest Industries sells a single model of satellite radio receivers for use in the home. The radios have the following price and cost characteristics: Sales price $80.00 per radio Variable costs $32.00 per radio Fixed costs $360,000.00 per month Crest is subject to an income tax rate of 40.00% a. How many receivers must Crest sell every month to break even? b. How many receivers must Crest sell to earn a monthly operating profit of $90,000.00 after taxes?

2. Cesar's Bottlers bottle soft drinks in a factory that can operate either one shift, two shifts, or three shifts per day. Each shift is eight hours long. The factory is closed on weekends. The sales price of $2.00 per case bottled and the variable cost of $0.90 per case remain constant regardless of volume. Cesar's Bottlers can increase volume by opening and staffing additional shifts. The company has the following three choices: Daily Volume Range Total Fixed (# of cases bottled) Costs per Day 1 Shift 0 - 2,000 $1,980.00 2 Shifts 2,001 - 3,600 $3,740.00 3 Shifts 3,601 - 5,000 $5,170.00 a. Calculate the break-even point(s). b. If Cesar's Bottlers can sell all the units it can produce, should it operate at one, two or three shifts?

Q.1) Emirates Steel Company reported the following accounting values:

Required:

Part 1:

a. Compute contribution margin.

b. Compute contribution margin percentage.

c. Compute gross margin.

d. Compute gross margin percentage.

e. Compute operating income.

Part-2:

Write a note on the above retrieved ratios and give comments whether investment in the shares of M/s Emirates Steel Company is a prudent decision as an investor or not? In both cases, respond why you taken decision of ‘Yes’ or ‘No’ (give reasons)?

Q.2) Pepsi Cola Company wants to estimate the cost for each process. It is a beverage manufacturing unit and only produce different flavors of beverages.

Required:

a. Classify each of the following costs as either direct or indirect with respect to production process.

b. Classify each of the following costs as either fixed or variable with respect to Pepsi Cola Company per day.

What two companies that have been guilty of ethics-based malfeasance related to financial management and determine why their comeuppance was deserved.

LaBBC Company has provided the following information from their records:

                                                                         Purchases                                         Sales               

                                                                 Units             Unit Cost              Units     Selling Price/Unit

Mar       1         Beginning inventory          100                  $50

             3         Purchase                             60                  $60

             4         Sales                                                                                   70                   $100

           10         Purchase                           200                  $70

           16         Sales                                                                                   80                   $110

           19         Sales                                                                                   80                   $110

           25         Sales                                                                                   50                   $110

           30         Purchase                             40                  $75

Using the inventory and sales data above, to complete the below inventory schedule under average cost method and prepare the journal entries to record the sales on March 4. All sales are made on credit.

ABC Company has provided the following information from their records:

                                                                         Purchases                                         Sales               

                                                                 Units             Unit Cost              Units     Selling Price/Unit

Mar       1         Beginning inventory          100                  $50

             3         Purchase                             60                  $60

             4         Sales                                                                                   70                   $100

           10         Purchase                           200                  $70

           16         Sales                                                                                   80                   $110

           19         Sales                                                                                   80                   $110

           25         Sales                                                                                   50                   $110

           30         Purchase                             40                  $75

Using the inventory and sales data above, to complete the below inventory schedule under FIFO method and prepare the journal entries to record the sales on March 4. All sales are made on credit.

The administrative offices and manufacturing plant of Billings Tool & Die share the same building. The following information (in $000s) appears in the accounting records for last year.

Required:

1. Prepare a cost of goods sold statement.

2. Prepare an income statement.

Prepare a cost of goods sold statement. (Enter your answers in thousands of dollars (i.e., 234,000 should be entered as 234).)

Prepare an income statement. (Enter your answers in thousands of dollars (i.e., 234,000 should be entered as 234).)

Determining Cost Relationships

Midstate Containers Inc. manufactures cans for the canned food industry. The operations manager of a can manufacturing operation wants to conduct a cost study investigating the relationship of tin content in the material (can stock) to the energy cost for enameling the cans. The enameling was necessary to prepare the cans for labeling. A higher percentage of tin content in the stock increases the cost of material. The operations manager believed that a higher tin content in the can stock would reduce the amount of energy used in enameling. During the analysis period, the amount of tin content in the stell can stock was increased for every month, from April to September. The following operating reports were available from the controller:

Differences in materials unit costs were entirely related to the amount of tin content. In addition, inventory changes are negligible and are ignored in the analysis.

A) Calculate the Total cost per unit for each month. Round your answers to the nearest cent

B) Interpret your results

The calculations reveal that the tin content and energy costs are _________ related. That is, as the materials cost increased due to higher tin content, the energy costs ________ by more. Thus, the recommendation should be to __________ raw can stock with the tin content at the $0.33-per-unit level (September level). This is the material that __________ the total production cost for this set of data. Additional data could be used to determine the optimal tin content or the point where energy cost savings fail to overcome additional material costs.

What assets are not in the Quick Ratio that are in the Current Ratio? What makes these assets different? Please explain

Compare planning budgets vs flexible budgets.

Be thorough in describing what each is, and the differences between them. Conclude with what the best use is for each.

1) Briefly explain what are the advantages and disadvantages of shared leadership?

1. The local police department is considering two types of sidearms for its officers. The Glock 40 costs $400 apiece and has a life of 4 years. The other option is a Sauer 45 that costs $800 and has a 12-year life. The Sauer pistol has a residual value of $200 at the end of its 12-year service life. Determine the better choice using the PW method and a study period of 8 years. The department uses a MARR of 5%.
2. Three different methods can be used for recovering by-product heavy metals from a manufacturing site’s liquid waste. The investment costs and incomes associated with each method are shown below. Assuming all methods have a 10-year life and the company’s MARR is 10% per year, determine which method should be selected using Annual Worth Analysis.

3. 	Method 1	Method 2	Method 3
   First Cost, $	20,000	18,000	25,000
   Salvage Value, $	1,000	3,000	1,500
   Annual Income, $	5,000	5,000	7,000