1. Pinter Company had the following environmental activities and product information:

   1. Environmental activity costs

   Activity	Costs
   Design products (to reduce pollution)	$ 118,800
   Test for contamination	211,200
   Treat toxic waste	660,000
   Operate pollution control equipment	528,000

   2. Driver data

   	Solvent X	Solvent Y
   Design hours	2,600	4,000
   Testing hours	4,700	12,900
   Pounds of waste	500	21,500
   Machine hours	2,600	85,400

   3. Other production data

   	Solvent X	Solvent Y
   Nonenvironmental production costs	$3,080,000	$6,028,000
   Units produced	440,000	440,000

   Required:

   1. Calculate the activity rates that will be used to assign environmental costs to products.

   Design products	$	per design hour
   Testing	$	per test hour
   Treating waste	$	per pound of waste
   Operating equipment	$	per machine hour

   2. Determine the unit environmental and unit costs of each product using ABC. If required, round your answers to the nearest cent.

   Activities	Solvent X	Solvent Y
   Unit environmental cost	$	$
   Unit cost	$	$

   3. What if the design costs increased to $208,800 and the cost of toxic waste decreased to $330,000? Assume that Solvent Y uses 8,000 out of 16,000 design hours. Also assume that waste is cut by 50 percent and that Solvent Y is responsible for 6,270 of 6,600 pounds of toxic waste. What is the new environmental cost for Solvent Y? If required, round your intermediate calculations and answer to the nearest cent.
   $ per unit

Marvel Parts, Inc., manufactures auto accessories. One of the company’s products is a set of seat covers that can be adjusted to fit nearly any small car. The company has a standard cost system in use for all of its products. According to the standards that have been set for the seat covers, the factory should work 1,060 hours each month to produce 2,120 sets of covers. The standard costs associated with this level of production are:

During August, the factory worked only 500 direct labor-hours and produced 2,200 sets of covers. The following actual costs were recorded during the month:

At standard, each set of covers should require 2.5 yards of material. All of the materials purchased during the month were used in production.

Required:

1. Compute the materials price and quantity variances for August.

2. Compute the labor rate and efficiency variances for August.

3. Compute the variable overhead rate and efficiency variances for August.

Comprehensive Problem 8-85 (LO 8-1, LO 8-2, LO 8-3, LO 8-4, LO 8-5) Skip to question [The following information applies to the questions displayed below.]

John and Sandy Ferguson got married eight years ago and have a seven-year-old daughter, Samantha. In 2020, John worked as a computer technician at a local university earning a salary of $152,000, and Sandy worked part time as a receptionist for a law firm earning a salary of $29,000. John also does some Web design work on the side and reported revenues of $4,000 and associated expenses of $750. The Fergusons received $800 in qualified dividends and a $200 refund of their state income taxes. The Fergusons always itemize their deductions, and their itemized deductions were well over the standard deduction amount last year. The Fergusons had qualifying insurance for purposes of the Affordable Care Act (ACA). Use Exhibit 8-9, Tax Rate Schedule, Dividends and Capital Gains Tax Rates, 2020 AMT exemption for reference. The Fergusons reported making the following payments during the year: State income taxes of $4,400. Federal tax withholding of $21,000. Alimony payments to John's former wife of $10,000 (divorced on 12/31/2014). Child support payments for John's child with his former wife of $4,100. $12,200 of real property taxes. Sandy was reimbursed $600 for employee business expenses she incurred. She was required to provide documentation for her expenses to her employer. $3,600 to Kid Care day care center for Samantha's care while John and Sandy worked. $14,000 interest on their home mortgage ($400,000 acquisition debt). $3,000 interest on a $40,000 home-equity loan. They used the loan to pay for a family vacation and new car. $15,000 cash charitable contributions to qualified charities. Donation of used furniture to Goodwill. The furniture had a fair market value of $400 and cost $2,000.

Comprehensive Problem 8-85 Part a a. What is the Fergusons' 2020 federal income taxes payable or refund, including any self-employment tax and AMT, if applicable? (Round your intermediate computations to the nearest whole dollar amount.)

• Choose three non-current assets. Describe at least two options which could be used to allow the business to utilise them. What are the advantages and disadvantages of each option you described?

• Discuss whether businesses should buy their non-current assets outright in

answer each question sperately

The following are transactions of Samantha Payapag Advertising Company for the month of July 2013

Prepare Journal Entries, General Ledger, T- Accounts, Trial Balance, Income Statement, and Balance Sheet

July 3 Samantha Payapag invested 500,000 in the business.

July 5 Bought for cash, advertising supplies costing 80,000. Paid rental of the office, 7,300

July 9 Bought delivery truck from MJ Idos Trading, 350,000 on credit

July 12 Received 43,000 cash as advertising income

July 13 Bought furniture & fixtures, 32,000 in cash

July 17 Took 3,200 cash for personal purposes

July 18 Billed Bernalyn Galvez for the advertising service rendered to promote her product to the market, 10,000

July 23 Paid salaries of the employees, 15,000. Billed Zaldy Co. for the advertising service rendered, 4,000

July 24 Collected 1/2 of the amount Bernalyn Galvez owed to the company

July 26 Purchased another truck amounting to 120,000 from Edwina Motor, Inc. on credit

July 27 Paid MJ Idos Trading 230,000 as partial settlement of the account

July 30 Paid utility expense for the month

AirQual Test Corporation provides on-site air quality testing services. The company has provided the following cost formulas and actual results for the month of February:

The company uses the number of jobs as its measure of activity. For example, mobile lab operating expenses should be $4,600 plus $35 per job, and the actual mobile lab operating expenses for February were $8,640. The company expected to work 120 jobs in February, but actually worked 124 jobs.

Required:

Prepare a flexible budget performance report showing AirQual Test Corporation’s revenue and spending variances and activity variances for February. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.)

Exercise 6.6. The ledger accounts of I-Cloud Internet Company appear as follows on March 31, 2016:

All accounts have normal balances. Journalize and post the closing entries. Use 4 as the page number for the general journal in journalizing the closing entries. Use account number 399 for the Income Summary Account.

A)McDonald’s offered toys that portrayed the characters in the movie The Incredibles for free with the purchase of a Happy Meal.  The giving away of these toys is an example of the use of what type of promotional tool?

A options:

B)

Which of the following is a commonly used pricing strategy that involves payment to an intermediary for promoting a manufacturer’s products?

B options:

C)

A __________ contains specific goals assigned to a salesperson, sales team, branch sales office, or sales district for a stated time period.

C options:

D)

Jane Caplow owns a picture-framing shop, The Caplow Company.  The average price she receives for a picture she frames for a customer is $120.  This price must cover her average costs for a typical framed picture of $5 for glass, $2 for matting, and $13 for the frame, and $30 for the labor involved.  She must also cover monthly expenses of $1,000 for rent and insurance, $200 for heat and electricity, $500 for advertising, and $3,500 for her salary.  Caplow is considering buying an automatic mat-cutting machine in order to reduce the number of hours of direct labor required to produce a framed picture.  In considering this purchase, she should recognize this purchase will _____ Caplow's variable cost and _____ Caplow's fixed cost.

D)

E)

Which of the following is a typical example of a fixed cost?

E)

tica Manufacturing (UM) was recently acquired by MegaMachines, Inc. (MM), and organized as a separate division within the company. Most manufacturing plants at MM use an ABC system, but UM has always used a traditional product costing system. Bob Miller, the plant controller at UM, has decided to experiment with ABC and has asked you to help develop a simple ABC system that would help him decide if it was useful. The controller’s staff has identified costs for the first month in the four overhead cost pools along with appropriate cost drivers for each pool:

The company manufactures two basic products with model numbers 308 and 510. The following are data for production for the first month as part of MM:

Required:

a. The current cost accounting system charges overhead to products based on machine-hours. What unit product costs will be reported for the two products if the current cost system continues to be used? (Round intermediate calculations and "Per unit cost" answers to 2 decimal places.)

b. A consulting firm has recommended using an activity-based costing system, with the activities based on the cost pools identified by the cost accountant. What are the cost driver rates for the four cost pools identified by the cost accountant? (Round your answers to 2 decimal places.)

c. What unit product costs will be reported for the two products if the ABC system suggested by the cost accountant’s classification of cost pools is used? (Round intermediate calculations and final answers to 2 decimal places.)

d. If management should decide to implement an activity-based costing system, what benefits should it expect?

Net Present Value Method, Present Value Index, and Analysis for a service company

Continental Railroad Company is evaluating three capital investment proposals by using the net present value method. Relevant data related to the proposals are summarized as follows:

Required:

1. Assuming that the desired rate of return is 12%, prepare a net present value analysis for each proposal. Use the present value of $1 table above. If required, use the minus sign to indicate a negative net present value. If required, round to the nearest dollar.

2. Determine a present value index for each proposal. If required, round your answers to two decimal places.

3. The ________________ has the largest present value index. Although _________________ has the largest net present value, it returns less present value per dollar invested than does the _______________________ , as revealed by the present value indexes. The present value index for the ______________ is less than 1, indicating that it does not meet the minimum rate of return standard.

Talk briefly about the sections of statement of cash flows.

Question 29:

Knight Co. owned 80% of the common stock of Stoop Co. Stoop had 50,000 shares of $5 par value common stock and 2,000 shares of preferred stock outstanding. Each preferred share received an annual per share dividend of $2 and is convertible into four shares of common stock. Knight did not own any of Stoop's preferred stock. Stoop also had 600 bonds outstanding, each of which is convertible into ten shares of common stock. Stoop's annual after-tax interest expense for the bonds was $2,000. Knight did not own any of Stoop's bonds. There are no excess amortizations or intra-entity transactions associated with this consolidation. Stoop reported net income of $300,000 for 2018. Knight has 100,000 shares of common stock outstanding and reported net income of $400,000 for 2018.

What would Knight Co. report as consolidated basic earnings per share (rounded)?

$7.00

$6.40

$5.68

$6.37

$6.00

The marketing director of a small private university is considering launching an advertising campaign-the first in the university's history-to boost student enrollment. She favored a mix of television, radio, and print advertising; recently, however, she read an article on the growing importance of inbound marketing. She has turned to you for advice on the relative merits of outbound marketing versus inbound marketing. What do you tell her? Can you provide any recommendations about what she should do for her campaign?

STOCHOS INC.      

STATEMENT of FINANCIAL POISTION                            

June 30, 2018

ASSETS                                                      LIABILITIES

Cash                               $222,000             Accounts Payable                $150,000

Accounts Rec.                     58,000             Mortgage Payable                  500,000

Inventory                              4,000           

Supplies                                 6,000              TOTAL LIABILITIES                    $650,000                           

Land                                  210,000

Buildings      $900,000                                STOCKHOLDER EQUITY

    Acc. Depr. <200,000> 700,000        

Equipment        260,000                             Common Stock $5 Par       $500,000

    Acc. Depr    <60,000> 200,000              Excess                                 $100,000

                                                                     Retained Earnings               $150,000

                                                                     TOTAL EQUITY                            $750,000            

TOTAL ASSETS      $1,400,000            TOTAL LIAB. & EQUITY         $1,400,000

July 1 Sold 220,000 shares of common stock for $6,600,000.

July 3 Purchased on account $100,000 of inventory for resale to customers.

July 5   Purchased a 2-year insurance policy for $4,800 in cash. Effective date is July 1.

July 7   Paid cash for $100,000 in inventory acquired July 3.

July 10 Sales revenue generated was $400,000. Cash received this date was $75,000 the

             balance would be received later in the year.

July 30 Paid $40,000 in wages for the month of July.

July 30 Acquired $800,000 of equipment. Useful life is 10 years. Signed a note (12%)

             for the full amount.

July 31 Paid $20,000 July monthly mortgage payment. The rate of interest on this

             mortgage is 7 per cent.

Aug. 1 Stochos declared a dividend of $1 per share. Shareholders who owned shares on

           August 15 would be paid the dividends in October.

Aug. 9 Stochos borrowed $180,000, and signed a note for this amount at 11 per cent.

Aug. 15 Customers returned $80,000 of items they acquired on July 10.

Aug. 18 Stochos sold 100,000 shares for $80 per share.

Aug. 30 Paid August wages – the $40,000 was paid in cash.

Aug. 31 Paid the August mortgage payment of $20,000.

Aug. 30 Paid $30,000 on the equipment note entered into on July 30 of this year.

Aug. 30 Received full amount due from the July 10 sale.

Sept. 30 Supply inventory valued at $200.

Sept. 30 Sales on account to customers amounted to $135,000. Stochos Inc. received

                $33,000 in cash on this date from customers.

Sept. 30 Wages were accrued this day in the amount of $40,000. Stochos Inc. informed

               their employee that their checks would be available October 5^th.

OTHER INFORMATION

1. Tax rate is 20%.

2. Building has a 20-year useful life from date of purchase.

3. All equipment has a useful life of ten years.

4. Inventory at the end of the quarter was $10,000.

PREPARE THE FOLLOWING:

1. INCOME STATEMENT

2. STATEMENT OF RETAINED EARNINGS

3. STATEMENT OF FINANCIAL POSTION [AKA] BALANCE SHEET

March, April, and May have been in partnership for a number of years. The partners allocate all profits and losses on a 4:2:2 basis, respectively. Recently, each partner has become personally insolvent and, thus, the partners have decided to liquidate the business in hopes of remedying their personal financial problems. As of September 1, the partnership’s balance sheet is as follows:

Prepare journal entries for the following transactions: (Do not round intermediate calculations. If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

1. Sold all inventory for $80,000 cash.
2. Paid $14,700 in liquidation expenses.
3. Paid $64,000 of the partnership’s liabilities.
4. Collected $84,000 of the accounts receivable.
5. Distributed safe payments of cash; the partners anticipate no further liquidation expenses.
6. Sold remaining accounts receivable for 35 percent of face value.
7. Sold land, building, and equipment for $41,000.
8. Paid all remaining liabilities of the partnership.
9. Distributed cash held by the business to the partners.