Smith Inc. engaged in the following transactions in 2019.

Smith Inc. Journal General – External Transactions                                             

Please explain the answer step by step:

Computing Average Unit Costs
The total monthly operating costs of Chili To Go are:

$8,000+ $0.30X

where

X = servings of chili

(a) Determine the average cost per serving at each of the following monthly volumes: 100; 1,000; 5,000; and 10,000.

Round answers to one decimal place.

(b) Determine the monthly volume at which the average cost per serving is $0.70.
Answer servings of chili

PLEASE EXPLAIN THE ANSWER STEP BY STEP

Automatic versus Manual Processing
Photo Station Company operates a printing service for customers with digital cameras. The current service, which requires employees to download photos from customer cameras, has monthly operating costs of $5,000 plus $0.20 per photo printed. Management is evaluating the desirability of acquiring a machine that will allow customers to download and make prints without employee assistance. If the machine is acquired, the monthly fixed costs will increase to $10,000 and the variable costs of printing a photo will decline to $0.04 per photo.

(a) Determine the total costs of printing 20,000 and 50,000 photos per month.

(b) Determine the monthly volume at which the proposed process becomes preferable to the current process.
Answer

units

Lynda Corporation manufactures two typed of glass sheets: clear glass and colored glass. Department 1 produces clear glass sheets, some of which we sold as finished goods. Others are transferred to Department 2, which adds additional materials to the clear glass sheets to form colored glass sheets, which are sold and finished product. The company something something operation something systems.

During the period, 2 jobs, were completed. Job Alpha was for 10,000 clear glass sheets and required in $200,000 materials. Job Beta was for 5,000 colored sheets and called for materials of $100,000 in department 1 and additional materials of $40,000 in Department 2.

The company strictly adhered to a Just-In-Time (JIT) inventory system for work in process

Conversion costs for the period were as follows:

Department 1              $180,000

Department 2              $50,000

Calculate the cost per unit transferred to finished goods inventory for each job, Alpha and Beta

$_____________   $______________

Alpha                          Beta

Job Beta is being sold to the government on a cost-plus basis. The vice president of marketing suggests that the conversion costs from Department #1 could be allocated on the basis of materials costs, so that he can offer a lower price for Job Alpha.

What do you think of this idea? Does it sound right? Are there any other issues here? Would you advise the company to do this? Explain.

Please show all work!!

The variable costing concept removes fixed costs, which are uncontrollable, from the decision-making process (see variable costing income statement). This forces management to focus on the variable factors of production, sales revenue and variable costs. I remember learning this concept in economics at LBCC, where a company should shut down if a product’s price falls below variable cost and just incur fixed costs.

Have you ever heard the saying “The company loses $1.00 on every unit sold, but we are confident the losses can be made up on volume.” Really?

In theory, companies should not operate with a negative contribution margin (sales revenue-variable costs), but my guess is that some do especially in this economic environment?

Do you think companies actually operate (or produce products) with a negative contribution margin?

1. Consider the audit risk model and its effect on the amount of evidence examined by the auditor.
   1. Describe each of the four risks in the model and indicate how it is related to the amount of evidence (directly or inversely)
   2. Describe how that business risk maybe factored into acceptable audit risk.
   3. How is risk of material misstatement calculated? Would the auditor rather see a higher or lower value?
   4. Can the risks be calculated precisely? Why or why not?

At what levels are unemployment liabilities incurred? What are some additional employer-borne liabilities that exist with having employees?

1. Discuss internal audit’s role for detecting and preventing corrupt practices within an organization, as well as the importance of ensuring that management has effective systems in place to detect and prevent corrupt practices.

Johnson Company leases computer equipment to customers under sales-type leases. The equipment has no residual value at the end of the lease and the leases do not contain purchase options. Johnson desires a return of 8% interest on a five-year lease of equipment with a fair value of $970,425.

(The present value of an annuity due of $1 at 8% for five years is 4.313.) OR

(Hint: Change the calculator setting to BGN for the annuity due.)

What is the annual lease payment?

)What is the total amount of interest revenue that Johnson will earn over the life of the lease?

Exercise 3-16 Santana Mortgage Company uses a process cost system to accumulate costs in its Application Department. When an application is completed, it is forwarded to the Loan Department for final processing. The following processing and cost data pertain to September. 1. Applications in process on September 1, 200 2. Applications started in September, 1,000 3. Completed applications during September, 700 4. Applications still in process at September 30 were 100% complete as to materials (forms) and 60% complete as to conversion costs. Beginning WIP: Direct materials $1,320 Conversion costs 5,060 September costs: Direct materials $5,100 Direct labor 12,500 Overhead 9,856 Materials are the forms used in the application process, and these costs are incurred at the beginning of the process. Conversion costs are incurred uniformly during the process. Santana Mortgage Company uses the FIFO method. Also, assume that the applications in process on September 1 were 100% complete as to materials (application forms) and 40% complete as to conversion costs. Your answer is partially correct. Try again. Determine the equivalent units of service (production) for materials and conversion costs. Materials Conversion Costs The equivalent units of service (production) Your answer is incorrect. Try again. Compute the unit costs. (Round unit costs to 2 decimal places, e.g. 2.25.) Materials Conversion Costs Unit costs $ $ Your answer is incorrect. Try again. Prepare a cost reconciliation schedule. (Round unit costs to 2 decimal places, e.g. 2.25 and final answers to 0 decimal places, e.g. 1,225.) Costs accounted for: Applications completed: Work in process, September 1 $ Conversion costs $ Started and completed $ Work in process, September 30: Materials Conversion costs Total costs $ Click if you would like to Show Work for this question: Open Show Work Question Attempts: 8 of 15 used Save for later Submit Answer Exercise 3-16 Santana Mortgage Company uses a process cost system to accumulate costs in its Application Department. When an application is completed, it is forwarded to the Loan Department for final processing. The following processing and cost data pertain to September. 1. Applications in process on September 1, 200 2. Applications started in September, 1,000 3. Completed applications during September, 700 4. Applications still in process at September 30 were 100% complete as to materials (forms) and 60% complete as to conversion costs. Beginning WIP: Direct materials $1,320 Conversion costs 5,060 September costs: Direct materials $5,100 Direct labor 12,500 Overhead 9,856 Materials are the forms used in the application process, and these costs are incurred at the beginning of the process. Conversion costs are incurred uniformly during the process. Santana Mortgage Company uses the FIFO method. Also, assume that the applications in process on September 1 were 100% complete as to materials (application forms) and 40% complete as to conversion costs. Your answer is partially correct. Try again. Determine the equivalent units of service (production) for materials and conversion costs. Materials Conversion Costs The equivalent units of service (production) Your answer is incorrect. Try again. Compute the unit costs. (Round unit costs to 2 decimal places, e.g. 2.25.) Materials Conversion Costs Unit costs $ $ Your answer is incorrect. Try again. Prepare a cost reconciliation schedule. (Round unit costs to 2 decimal places, e.g. 2.25 and final answers to 0 decimal places, e.g. 1,225.) Costs accounted for: Applications completed: Work in process, September 1 $ Conversion costs $ Started and completed $ Work in process, September 30: Materials Conversion costs Total costs $ Click if you would like to Show Work for this question: Open Show Work Question Attempts: 8 of 15 used Save for later Submit Answer

The balances in the accounts of Maybe Ltd at 30 June 2019 and 30 June 2020 are:

Other information:

Share capital is increased by the bonus issue of 24 000 shares for $1.00 each out of retained earnings. Plant is acquired during the period at a cost of $36 000, while plant with a carrying amount of $nil (cost of $24 000, accumulated depreciation of $24 000) is scrapped.

Required:

a)      Reconstruct the allowance for doubtful debts and accounts receivable.

(6.5 marks)

b)      Reconstruct inventory and accounts payable

c)      Reconstruct accrued salaries

d)      Reconstruct property, plant and equipment and a

1. Comparing ABC and Plantwide Overhead Cost Assignments

   Wellington Chocolate Company uses activity-based costing (ABC). The controller identified two activities and their budgeted costs:

   Setting up equipment	$270,000
   Other overheard	$2,160,000

   Setting up equipment is based on setup hours, and other overhead is based on oven hours.
   Wellington produces two products, Fudge and Cookies. Information on each product is as follows:

   	Fudge			Cookies
   Units produced	8,000			445,000
   Setup hours	4,000			1,000
   Oven hours	1,800			12,600

   Required:

   Round your answers to the nearest whole dollar, unless otherwise directed.

   1. Calculate the activity rate for (a) setting up equipment and (b) other overhead.

   a. Setting up equipment	$ per setup hour
   b. Other overhead	$ per oven hour

   2. How much total overhead is assigned to Fudge using ABC?
   $

   3. What is the unit overhead assigned to Fudge using ABC? Round to the nearest cent.
   $per unit

   4. Now, ignoring the ABC results, calculate the plantwide overhead rate, based on oven hours. Round to the nearest cent.
   $ per oven hour

   5. How much total overhead is assigned to Fudge using the plantwide overhead rate?
   $

   6a. The difference in the total overhead assigned to Fudge is different under the ABC system and non–ABC system because  .

   6b. What is the difference in total overhead assigned to fudge under the two methods?

   $

On December 31, 2017, Sage Company signed a $1,022,000 note to Pronghorn Bank. The market interest rate at that time was 11%. The stated interest rate on the note was 9%, payable annually. The note matures in 5 years. Unfortunately, because of lower sales, Sage’s financial situation worsened. On December 31, 2019, Pronghorn Bank determined that it was probable that the company would pay back only $613,200 of the principal at maturity. However, it was considered likely that interest would continue to be paid, based on the $1,022,000 loan.

Determine the amount of cash Sage received from the loan on December 31, 2017. (Round present value factors to 5 decimal places, e.g. 0.52513 and final answer to 0 decimal places, e.g. 5,275.)

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Prepare a note amortization schedule for Pronghorn Bank up to December 31, 2019. (Round answers to 0 decimal places, e.g. 5,275.)

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Determine the loss on impairment that Pronghorn Bank should recognize on December 31, 2019. (Round present value factors to 5 decimal places, e.g. 0.52500 and final answer to 0 decimal places, e.g. 5,275.)