Doggie Pawz produces two models of dog beds: rectangle and circle. The following information about the costs to produce the company’s products has been provided.

a. If all costs are allocated based on machine hours, what is the rate per machine hour?

b. If all costs are allocated based on machine hours, what is the amount allocated to circle dog beds?

c. If ABC uses activity based costing based on the cost pools above, what is the rate for unit-level costs?

d. If ABC uses activity based costing based on the cost pools above, what is the rate for batch-level costs?

e. If ABC uses activity based costing based on the cost pools above, what is the rate for product-level costs?

f. If ABC uses activity based costing based on the cost pools above, what is the rate for facility-level costs?

g. If ABC uses activity based costing based on the cost pools above, what amount is allocated to rectangle beds?

Label and place your final answer for a-g at the top of the answer box. Then after the answer to g, label and show your work for each part of the question. Just show me numbers - that is usually enough for me to follow your logic.

Koontz Company manufactures a number of products. The standards relating to one of these products are shown below, along with actual cost data for May.

The production superintendent was pleased when he saw this report and commented: “This $0.83 excess cost is well within the 5 percent limit management has set for acceptable variances. It's obvious that there's not much to worry about with this product."

Actual production for the month was 11,000 units. Variable overhead cost is assigned to products on the basis of direct labor-hours. There were no beginning or ending inventories of materials.

Required:

2. How much of the $0.83 excess unit cost is traceable to each of the variances computed in (1) above.

3. How much of the $0.83 excess unit cost is traceable to apparent inefficient use of labor time?

2

3

On January 1, 2018, the general ledger of 3D Family Fireworks includes the following account balances:
  

During January 2018, the following transactions occur:
  

The following information is available on January 31, 2018.

1. The company estimates future uncollectible accounts. The company determines $5,800 of accounts receivable on January 31 are past due, and 20% of these accounts are estimated to be uncollectible. The remaining accounts receivable on January 31 are not past due, and 5% of these accounts are estimated to be uncollectible. (Hint: Use the January 31 accounts receivable balance calculated in the general ledger.)
2. Supplies at the end of January total $650.
3. Accrued interest revenue on notes receivable for January. Interest is expected to be received each December 31.
4. Unpaid salaries at the end of January are $34,300.

1. Record each of the transactions listed above in the 'General Journal' tab (these are shown as items 1 - 7). Review the 'General Ledger' and the 'Trial Balance' tabs to see the effect of the transactions on the account balances.

2. Record the adjusting entries in the 'General Journal' tab (these are shown as items 8-11).

3. Review the adjusted 'Trial Balance' as of January 31, 2018, in the 'Trial Balance' tab.

4. Prepare an income statement for the period ended January 31, 2018, in the 'Income Statement' tab.

5. Prepare a classified balance sheet as of January 31, 2018 in the 'Balance Sheet' tab.

6. Record the closing entries in the 'General Journal' tab (these are shown as items 12 and 13).

7. Using the information from the requirements above, complete the 'Analysis' tab.

Please help

the following selected circumstances related to pending lawsuits for Erismus, Inc. Erismus's fiscal year ends on December 31st. Financial statements are issued on March 2017. Erismus prepares its financial statements according to us gaap.

indicate the amount of asset or liability that Erismus would record and explain your answer.

1. Erismus is defending against a lawsuit. Erismus's management believes the company has a slightly worse than 50-50 chance eventually prevailing in court and that if it loses the judgement will be $1000000.
2. Erismus is defending against a lawsuit. Erismus's management believes it is probable that the company will lose in court. If it loses, management believes that damages could fall anywhere in the range of 2 million dollars to four million dollars with any damage in that range equally likely.
3. Erismus is defending against a lawsuit. Erismus's management believes it is probable that the company will lose in Court. if it loses, management believes the damages will eventually be $5000000 with the present value of 3500000 dollars.
4. Erismus is a plaintiff in a lawsuit. Erismus management believes it is probable that the company eventually will prevail in court, and that if it prevails the judgement will be $1000000.
5. Erismus is a plaintiff in a lawsuit. Erismus's management believes it is virtually certain that the company eventually will prevail in court and that if it reveals the judgment will be $500,000.

E12-4 (L01,2,5) (Intangible Amortization) The following is selected information for Alatorre Company.
1. Alatorre purchased a patent from Vania Co. for $1,000,000 on January 1, 2015. The patent is being amortized over its remaining legal life of 10 years, expiring on January 1, 2025. During 2017, Alatorre determined that the economic benefits of the patent would not last longer than 6 years from the date of acquisition. What amount should be reported in the bal-ance sheet for the patent, net of accumulated amortization, at December 31, 2017?
2. Alatorre bought a franchise from Alexander Co. on January 1, 2016, for $400,000. The carrying amount of the franchise on Alexander’s books on January 1, 2016, was $500,000. The franchise agreement had an estimated useful life of 30 years. Because Alatorre must enter a competitive bidding at the end of 2018, it is unlikely that the franchise will be retained beyond 2025. What amount should be amortized for the year ended December 31, 2017?
3. On January 1, 2017, Alatorre incurred organization costs of $275,000. What amount of organization expense should be reported in 2017?
4. Alatorre purchased the license for distribution of a popular consumer product on January 1, 2017, for $150,000. It is expected that this product will generate cash flows for an indefinite period of time. The license has an initial term of 5 years but by paying a nominal fee, Alatorre can renew the license indefinitely for successive 5-year terms. What amount should be amortized for the year ended December 31, 2017?
Instructions Answer the questions asked about each of the factual situations.

Using an indirect method statement of cash flows from a publicly traded company, discuss an item that was recorded when calculating net income, but is adjusted as an increase or decrease to determine cash provided by (used by) operating activities, specifically an asset, liability, gain, or loss. Include a summary of how that item impacted net income (or net loss) and why there is an adjustment necessary to determine cash from operations.

Your colleague claims that all of the statements below regarding a partner’s sale or exchange of a partnership interest are true. Do you agree? If so, why? If not, why not?

a. The sale or exchange of a partner’s interest in a partnership usually results in a capital gain or loss.

b. Gain or loss recognized by the selling partner is the difference between the amount realized and the adjusted basis of the partner’s interest in the partnership.

c. The selling partner must include, as part of the amount realized, any partnership liability he/she is relieved of.

d. The installment method cannot be used by the partner who sells a partnership interest at a gain.

Prior to the financial recession in the late 2000s, some companies had built up significant cash balances. By 2010, discussions began about whether “cash hoarding” by firms was an appropriate activity or if it was hurting the economic recovery. Research this issue and answer the following questions:

• What are the advantages of having a large cash balance? Please describe and provide examples.
• What are the disadvantages of having a large cash balance? Please describe and provide examples.
• Research a publicly traded company that holds a sizable amounts of cash and liquid investments on their balance sheets. Describe the company, the balance and how that balance has varied over the past three years.

Diversified semiconductors sells perishable electronic components. some must be shipped and stored in reusable protective containers. customers pay a deposit for each container received. the deposit is equal to the containers cost. they receive a refund when the container is returned. during 2016, deposits collected on containers shipped where $850,000. deposits are forfeited if containers are not returned within 18 months. containers held by customers at January one 2016 represented deposits a $530,000. in 2016, $790,000 was refunded and deposits forfeited were $35,000.

1. prepare the appropriate journal entries for the deposits received and return during 2016.

2. determine the liability for refundable deposits to be reported on the December 31st 2016 balance sheet.

1. Financial information for Sigma Company is presented below. Calculate the following ratios for 2018:

(a) Inventory turnover.

(b) Accounts receivable turnover.

(c) Return on total assets.

(d) Times interest earned.

(e) Total asset turnover.

3. Xavier is starting an online business called ‘footbook’ that is a social networking website where people post pictures of their feet. Xavier has a lunch meeting with his sister to discuss whether she would like to invest in the business. He tells her “if I don’t hear from you by 2 Friday I will assume you agree to my offer.” Friday passes and Sally has not contacted Xavier. Can Xavier legally claim the investment money from Sally?

Current operating income for Bay Area Cycles Co. is $32,000. Selling price per unit is $100, the contribution margin ratio is 20%, and fixed expense is $128,000.

Required:

1. Calculate Bay Area Cycle’s per unit variable expense and contribution margin. How many units are currently being sold?

2. How many additional unit sales would be necessary to achieve operating income of $80,000?

1. A new operating system for an existing machine is expected to cost $710,000 and have a useful life of six years. The system yields an incremental after-tax income of $155,000 each year after deducting its straight-line depreciation. The predicted salvage value of the system is $21,800.
2. A machine costs $570,000, has a $33,800 salvage value, is expected to last eight years, and will generate an after-tax income of $84,000 per year after straight-line depreciation.

Assume the company requires a 12% rate of return on its investments. Compute the net present value of each potential investment. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.)

A new operating system for an existing machine is expected to cost $710,000 and have a useful life of six years. The system yields an incremental after-tax income of $155,000 each year after deducting its straight-line depreciation. The predicted salvage value of the system is $21,800. (Round your answers to the nearest whole dollar.)

A machine costs $570,000, has a $33,800 salvage value, is expected to last eight years, and will generate an after-tax income of $84,000 per year after straight-line depreciation. (Round your answers to the nearest whole dollar.)

51. On January 1, a company issues bonds dated January 1 with a par value of $580,000. The bonds mature in 5 years. The contract rate is 6%, and interest is paid semiannually on June 30 and December 31. The market rate is 7% and the bonds are sold for $555,871. The journal entry to record the second interest payment using the effective interest method of amortization is:

• Debit Interest Expense $15,344.52; debit Discount on Bonds Payable $2,055.48; credit Cash $17,400.00.

• Debit Interest Expense $15,344.52; debit Premium on Bonds Payable $2,055.48; credit Cash $17,400.00.

• Debit Interest Expense $19,527.42; credit Discount on Bonds Payable $2,127.42; credit Cash $17,400.00.

• Debit Interest Payable $17,400.00; credit Cash $17,400.00.

• Debit Interest Expense $19,455.48; credit Discount on Bonds Payable $2,055.48; credit Cash $17,400.00.

58. Sweet Company’s outstanding stock consists of 1,800 shares of cumulative 5% preferred stock with a $100 par value and 11,800 shares of common stock with a $10 par value. During the first three years of operation, the corporation declared and paid the following total cash dividends.

The amount of dividends paid to preferred and common shareholders in year 3 is:

• $41,000 preferred; $0 common.

• $17,000 preferred; $24,000 common.

• $0 preferred; $41,000 common.

• $9,000 preferred; $32,000 common.

• $27,000 preferred; $14,000 common.

62. Marwick Corporation issues 12%, 5 year bonds with a par value of $1,030,000 and semiannual interest payments. On the issue date, the annual market rate for these bonds is 10%. What is the bond's issue (selling) price, assuming the following Present Value factors:

• $819,244

• $1,030,000

• $1,109,518

• $1,507,201

• $552,799

65. Eastline Corporation had 11,500 shares of $5 par value common stock outstanding when the board of directors declared a stock dividend of 3,795 shares. At the time of the stock dividend, the market value per share was $15. The entry to record this dividend is:

• Debit Common Stock Dividend Distributable $56,925; credit Retained Earnings $56,925.

• Debit Retained Earnings $56,925; credit Common Stock Dividend Distributable $56,925.

• No entry is needed.

• Debit Retained Earnings $56,925; credit Common Stock Dividend Distributable $18,975; credit Paid-In Capital in Excess of Par Value, Common Stock $37,950.

• Debit Retained Earnings $18,975; credit Common Stock Dividend Distributable $18,975.

Chenango Industries uses 11 units of part JR63 each month in the production of radar equipment. The cost of manufacturing one unit of JR63 is the following:

Material handling represents the direct variable costs of the Receiving Department that are applied to direct materials and purchased components on the basis of their cost. This is a separate charge in addition to manufacturing overhead. Chenango Industries’ annual manufacturing overhead budget is one-third variable and two-thirds fixed. Scott Supply, one of Chenango Industries’ reliable vendors, has offered to supply part number JR63 at a unit price of $57,000.

Required:

1. If Chenango Industries purchases the JR63 units from Scott, the capacity Chenango Industries used to manufacture these parts would be idle. Should Chenango Industries decide to purchase the parts from Scott, the unit cost of JR63 would increase (or decrease) by what amount?
2. Assume Chenango Industries is able to rent out all its idle capacity for $87,000 per month. If Chenango Industries decides to purchase the 11 units from Scott Supply, Chenango’s monthly cost for JR63 would increase (or decrease) by what amount?
3. Assume that Chenango Industries does not wish to commit to a rental agreement but could use its idle capacity to manufacture another product that would contribute $171,000 per month. If Chenango’s management elects to manufacture JR63 in order to maintain quality control, what is the net amount of Chenango’s cost from using the space to manufacture part JR63?