EXAMPLE:

G.A. Courtney & Sons build homes.  Each home is considered a job; costs are accumulated by job to determine the final cost of a home. The company builds two types of homes. Standard models are framed at factory using high-tech machinery and take little direct labor to complete. Custom homes are framed and finished at the building site using mostly direct labor and few machine hours. Annual estimates for each department follow:

During the year, five jobs were started and completed. Jobs #101 and #103 were custom homes.  The remaining jobs were standard models. Direct materials (DM), direct labor (DL), direct labor hours (DLH), and machine hours (MH) for each job follow:

REQUIRED:

(1)        Calculate the predetermined overhead rate (POR) using:

(a)        A single, plantwide cost pool and DLH as the application base.

(b)        Separate total overhead amounts for each department (one total for framing and one for finishing). Use MH as the application base for framing and DLH for finishing.

(2)        Use the following format to calculate:

            (a)        The total costs of each job using the single, plantwide POR (from                                                      (1)(a) above).   

(b)        The total costs of all jobs using the single, plantwide POR (from (1)(a) above).

Note: the “totals” line item at the bottom of the table satisfy this requirement.

(3)        Use the following format to calculate:

(a)        The total costs of each job using the two departmental (framing and finishing) PORs (from (1)(b) above).

(b)        The total costs of all jobs using the two departmental (framing and finishing) PORs (from (1)(b) above)

Note: the “totals” line item at the bottom of the table satisfy this requirement.

48. LO.3 During the year (not a leap year), Anna rented her vacation home for 30 days, used it personally for 20 days, and left it vacant for 315 days. She had the following income and expenses: Rent income $ 7,000 Expenses  Real estate taxes 2,500  Interest on mortgage 9,000  Utilities 2,400  Repairs 1,000  Roof replacement (a capital expenditure) 12,000  Depreciation 7,500 1. Compute Anna’s net rent income or loss and the amounts she can itemize on her tax return, using the court’s approach to allocating property taxes and interest. 2. How would your answer in part (a) differ using the IRS’s method of allocating property taxes and interest?

49. LO.3 How would your answer to Problem 48 differ if Anna had rented the house for 87 days and had used it personally for 13 days?

**Please fill out the chart post at the bottom and please do not copy and paste a previous answer that has been used on CHegg.

Lehighton Chalk Company manufactures sidewalk chalk, which it sells online by the box at $24 per unit. Lehighton uses an actual costing system, which means that the actual costs of direct material, direct labor, and manufacturing overhead are entered into work-in-process inventory. The actual application rate for manufacturing overhead is computed each year; actual manufacturing overhead is divided by actual production (in units) to compute the application rate. Information for Lehighton’s first two years of operation is as follows:

Selected information from Lehighton’s year-end balance sheets for its first two years of operation is as follows:

Prepare a numerical reconciliation of the difference in income reported under the two costing methods used in requirements (1) and (2).

On November 1, 2018, Kris Lehman established an interior decorating business, Modern Designs. During the month, Kris completed the following transactions related to the business:

Enter the following transactions on Page 2 of the two-column journal:

******Question

The following schedule of information relates to Lumos, Inc. for the year ended December 31, 2017:

The company’s balance sheet reports the following:

The company’s 2017 income statement reports the following:

Required:

Provide the following amounts that would appear on an indirect method statement of cash flows for December 31, 2017 for Lumos, Inc.:

a. Net cash provided (used) by operating activities: _____________________

            b. Net cash provided (used) by investing activities: _____________________

            c. Net cash provided (used) by financing activities: _____________________

22. Determine the amount of money in a savings account at the end of 3 years, given an initial deposit of $4,000 and an annual interest rate of 4 percent when interest is compounded: Use Appendix A for an approximate answer, but calculate your final answer using the formula and financial calculator methods. (Do not round intermediate calculations. Round your final answers to 2 decimal places.)

30. Your parents have accumulated a $170,000 nest egg. They have been planning to use this money to pay college costs to be incurred by you and your sister, Courtney. However, Courtney has decided to forgo college and start a nail salon. Your parents are giving Courtney $20,000 to help her get started, and they have decided to take year-end vacations costing $8,000 per year for the next four years. Use 8 percent as the appropriate interest rate throughout this problem. Use Appendix A and Appendix D for an approximate answer, but calculate your final answer using the formula and financial calculator methods.

a. How much money will your parents have at the end of four years to help you with graduate school, which you will start then? (Round your final answer to 2 decimal places.)

b. You plan to work on a master’s and perhaps a PhD. If graduate school costs $23,540 per year, approximately how long will you be able to stay in school based on these funds? (Round your final answer to 2 decimal places.)

1

Assuming Target’s industry had an average current ratio of 1.0 and an average debt to equity ratio of 2.5, comment on Target’s liquidity and long-term solvency.

What is forward contract?

(please write everything about forward contract in very simple language that anybody can understand it)               

200 words please

In a recent Wall Street Journal article (“The Price You Pay for Water at the Airport,” Scott McCartney, April 22, 2015), the cost of a bottle at various airports was compared to the cost of that same bottle of water at a convenience store.

A 20-ounce bottle of Dasani water typically costs about $0.99 at a convenience store. At the JFK International airport in New York City, that bottle of Dasani water is $2.89.

An airport store operator interviewed for the WSJ story stated that the costs of operating airport shops are more expensive than other retail stores because:

• Off-airport warehouses are needed due to limited inventory space
• Deliveries to stores are usually made during off-peak hours
• Deliveries are made in small batches so that everything can go through airport security screening

Discussion Questions

1. Is the cost of an off-airport warehouse considered to be a unit-level, batch-level, product-level, or facility-level cost as it relates to:
   1. The airport store
   2. An individual bottle of water
2. In an activity-based costing system, what costs would be considered to be part of the cost of an individual bottle of Dasani water at the airport?
3. Would the airport store be likely to use the ABC cost for water pricing? Why or why not?
4. Would activity-based costing or activity-based management be useful for the airport store? Why or why not?

Vittoria Ltd requires a Statement of Cash Flows to be prepared for the year ended

31 March 2018, the following information has been collected for this purpose.

Additional information:

Vittoria Ltd classifies interest expense and dividends paid as cash outflows from financing activities.

Plant and equipment, with a fair value of $100 000, has been acquired by the issue of

$100 000 worth of fully paid Vittoria Ltd shares to the sellers of the plant and equipment.

During the year, equipment that originally cost $100 000 was sold for $30 000 cash.

Plant and equipment was revalued upwards by $30 000.

A long-term loan of $30 000 was specifically organised for the purchase of plant and equipment costing $30 000.  

Required:

(iii) Prepare a statement of cash flows for Vittoria Ltd, for the year ended 31 March 2018, in accordance with NZ IAS 7 Statement of Cash Flows. Vittoria Ltd uses the directmethod for the cash flows from operating activities (CFOA) section. Complete the necessary reconciliation, as required by NZ FRS-44, to be included in the notes.

CFOA = cash flows from operating activities, CFIA = cash flows from investing activities and CFFA = cash flows from financing activities.        

Slick Corporation is a small producer of synthetic motor oil. During May, the company produced 5,000 cases of lubricant. Each case contains 12 quarts of synthetic oil. To achieve this level of production, Slick purchased and used 16,500 gallons of direct materials at a cost of $20,208. It also incurred average direct labor costs of $15 per hour for the 4,074 hours worked in May by its production personnel. Manufacturing overhead for the month totaled $9,284, of which $2,200 was considered fixed. Slick's standard cost information for each case of synthetic motor oil is as follows.

Required:

a. Compute the materials price and quantity variances.

b. Compute the labor rate and efficiency variances.

c. Compute the manufacturing overhead spending and volume variances.

d. Prepare the journal entries to:

1. Charge materials (at standard) to Work in Process.

2. Charge direct labor (at standard) to Work in Process.

3. Charge manufacturing overhead (at standard) to Work in Process.

4. Transfer the cost of the 5,000 cases of synthetic motor oil produced in May to Finished Goods.

5. Close any over- or underapplied overhead to cost of goods sold.

New Age Electronics manufactures surround sound systems and allocates overhead costs using direct-labor hours. They pay their assembly line workers $15 per hour. Unadjusted Cost of Goods Sold for the year was $598,500. Estimated accounting information for the year is as follows:

Overhead costs $140,000

Direct materials $355,000

Direct labor costs (7,000 hours @ $15/hour) $105,000

Direct labor hours 7,000

Machine hours 8,000 Actual accounting information incurred for the year was as follows:

Direct materials $350,000

Direct labor (7,100 hours @ $15/hour) $106,500

Production Manager’s Salary $ 25,000

Customer 800# order line $ 2,000

Plant rent $ 75,000

Depreciation on plant and equipment $ 50,000

Marketing expense $ 20,000

Plant utilities $ 19,000

Indirect materials $ 1,000

Delivery expenses to customers $ 5,000

Depreciation on office equipment $ 5,000

Machine hours 7,900

What actual amount of overhead costs were incurred?

Was overhead under or over allocated/applied and by how much?

$28,000 under-allocated/applied $30,000 under-allocated/applied $28,000 over-allocated/applied $30,000 over-allocated/applied

What is the adjusted Cost of Goods Sold amount?

LG sold 800 G7 phones in October for LG Electronics. As the demand was so high, LG can just deliver the G7 phones in November and it allowed LG Electronics for paying for them just in December and January. When will LG record the revenue from this sale?

A. October

B. November

C. December

D. December and January

On June 1, 2019, Kris Storey established an interior decorating business, Eco-Centric Designs. During the month, Kris completed the following transactions related to the business:

June
1
Kris transferred cash from a personal bank account to an account to be used for the business, $35,000.

1
Paid rent for period of June 1 to end of month, $4,750.

6
Purchased office equipment on account, $14,100.

8
Purchased a van for $28,500 paying $4,500 cash and giving a note payable for the remainder.

10
Purchased supplies for cash, $2,380.

12
Received cash for job completed, $12,200.

15
Paid annual premiums on property and casualty insurance, $3,600.

23
Recorded jobs completed on account and sent invoices to customers, $11,900.

24
Received an invoice for van expenses, to be paid in June, $1,500.

Enter the following transactions on Page 2 of the two-column journal:

June
29
Paid utilities expense, $3,100.

29
Paid miscellaneous expenses, $950.

30
Received cash from customers on account, $7,330.

30
Paid wages of employees, $5,070.

30
Paid creditor a portion of the amount owed for equipment purchased on June 6, $6,825.

30
Withdrew cash for personal use, $1,600.

Required:
1.
Journalize each transaction in a two-column journal beginning on Page 1, referring to the chart of accounts in selecting the accounts to be debited and credited. (Do not insert the post reference numbers until you have posted the entry to the general ledger in part 2.)

You have “volunteered” as an unpaid intern to keep the books for my company that sells hotdogs at the beach. I established the business on September 1 and officially started selling hotdogs 3 days later.

Below are the transactions for September.

September 1                 The owner contributed $20,000 to the business to start the operations.

September 2                 Purchased a fully equipped hotdog cart for $15,000. Paid $5,000 upfront and put the remainder of the balance on account.

September 3                 Purchased hotdogs, sodas and consumable supplies for $500.

September 3                 Purchased 3 months of advertising services from the HB Times newspaper for $300.

September 4                 Sold $200 worth of hot dogs to customers for cash.

September 5                 Sold $300 worth of hot dogs to customers for cash.

September 6                 Sold $100 worth of hotdogs the HBPD on account.

September 8                 The HB surfing contest company asked me to supply hotdogs for their contests and paid $600 in advance for a total of 6 contests.

September 9                 Hired a person to help with the surf contest sales. Paid that person $100 for services performed.

September 10               Purchased hotdogs, sodas and consumable supplies for $500.

September 12               Sold $200 worth of hot dogs to customers for cash.

September 18               The city of HB requested that you provide $500 worth of food for an event they are holding at the pier this coming weekend. The job was completed. The city of HB paid $200 and you billed the difference.

September 25               HBPD paid the balance on account due from September 6.

September 26               Received propane (utility) bill, $100, which was put on account.

September 30               Took out a small business loan from the bank for $15,000 to expand the business. The bank approved the loan due one year from today.

September 30               The owner withdrew $200 in the form of dividends.

Adjustments

1. Expired advertising.
2. Provided hotdogs for 3 surfing contests
3. Depreciation of hotdog cart, $300.

Instructions

1. Journalize all September transactions in the general journal. You may skip journal entry descriptions.
2. Post every journal entry recorded in #1 above to the general ledger. The first transaction on September 1 has been journalized in the general journal and posted to the general ledger as an example.