Highland Company produces a lightweight backpack that is popular with college students. Standard variable costs relating to a single backpack are given below:
| Standard
Quantity or Hours |
Standard Price or Rate |
Standard Cost |
|||||
| Direct materials | ? | $ | 3.00 | per yard | $ | ? | |
| Direct labor | ? | ? | ? | ||||
| Variable manufacturing overhead | ? | $ | 2 | per direct labor-hour | ? | ||
| Total standard cost per unit | $ | ? | |||||
Overhead is applied to production on the basis of direct labor-hours. During March, 570 backpacks were manufactured and sold. Selected information relating to the month’s production is given below:
| Materials Used |
Direct Labor | Variable Manufacturing Overhead |
|||||||
| Total standard cost allowed* | $ | 8,550 | $ | 6,384 | $ | 1,596 | |||
| Actual costs incurred | $ | 6,080 | ? | $ | 2,812 | ||||
| Materials price variance | ? | ||||||||
| Materials quantity variance | $ | 570 | U | ||||||
| Labor rate variance | ? | ||||||||
| Labor efficiency variance | ? | ||||||||
| Variable overhead rate variance | ? | ||||||||
| Variable overhead efficiency variance | ? | ||||||||
*For the month's production.
The following additional information is available for March’s production:
| Actual direct labor-hours | 855 | |||
| Difference between standard and actual cost per backpack produced during March | $ | 0.20 | F | |
Required:
Hint: It may be helpful to complete a general model diagram for direct materials, direct labor, and variable manufacturing overhead before attempting to answer any of the requirements.
5. What is the standard direct labor rate per hour?
6. What was the labor rate variance for March? The labor efficiency variance?
7. What was the variable overhead rate variance for March? The variable overhead efficiency variance?
8. Prepare a standard cost card for one backpack.
In: Accounting
Lindon company is the exclusive distributor for an automotive product that sells for $38 per unit and has a cm ratio of 30%. the company's fixed expenses are $180,000 per year. the company plans to sell 16,000 units this year.
required:
1. what are the variable expenses per unit?
2. using the equation method;
a. what is the break-even point in unit sales and in dollar sales?
b. what sales level in unit and dollar is required to earn an annual profit of $50,000?
4. assume that by using a more efficient shipper, the company is able to reduce its variable expenses by $3 per unit. what is the company's new break-even point in unit sales and in dollar sales?
In: Accounting
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In: Accounting
Taylored T’s is a sole proprietorship owned and operated by Taylor Breckitt. TT’s takes plain t-shirts and prints or sews logos and designs for customers. Taylor is required to file financial statements with his bank each month in order to keep their credit line open. TT’s reported the following results for March:
|
Beginning Raw Materials Inventory |
$500 |
|
Ending Raw Materials Inventory: |
$750 |
|
Beginning Work in Process Inventory: |
$3,200 |
|
Beginning Finished Goods Inventory: |
$2,500 |
|
Ending Finished Goods Inventory: |
$2,200 |
|
Cost of Goods Sold: |
$42,500 |
|
Materials Purchased: |
$49,000 |
|
Indirect Materials Used: |
$9,000 |
|
Direct Labor Wages: |
$50,000 |
|
Indirect Labor Wages: |
$6,100 |
|
Production Equipment Depreciation: |
$2,600 |
|
Equipment Maintenance: |
$1,800 |
|
Factory Rent: |
$5,400 |
|
Office Supplies Used: |
$1,250 |
|
Selling and Administrative Expenses: |
$11,100 |
The bank is especially concerned about the Working Capital ratio, so they want to be sure that TT is reporting their assets fairly.
What was TT’s Ending Work in Process Inventory for the period?
Select one or more:
a. $38,880
b. $154,850
c. $94,205
d. $75,650
In: Accounting
On January 1, 2021, Sikie Shoe Manufacturing Corporation had 60,000 shares of $5 par value common stock issued and outstanding and 10,000 6% $50 cumulative preferred stock issued and outstanding. During the year, the following transactions occurred:
3/1/2021 Declared a 20% stock dividend on outstanding common stock to stock holders of record March 15. The market price per share as of March 1 is $18
4/1/2021 The 20% stock dividend declared on March 1 was issued to the common stockholders.
4/10/2021 Declared cash dividend to preferred stockholders of record on April 20
4/30/2021 Paid preferred stockholders' dividend declared on April 10.
5/10/2021 Declared a 35% stock dividend on outstanding common stock to stockholders of record May 20. The market price per share as of May 10 is $25
5/30/2021 The 35% stock dividend declared on May 10 was issued to the common stockholders.
9/30/2021 A 3 for 1 stock split was announced for common stock holders on record as of October 15. The market price of the share was $90 on Sept 30
12/1/2021 Declared a cash dividend of $1.00 per share to common stockholders of record on Dec. 10
12/20/2021 Paid the $1.00 cash dividend to the common shareholders.
instructions:
a. Prepare journal entries to record each of the above transactions. If no entry is required, indicate so.
b. Prepare all closing entries at year-end.
In: Accounting
Diego Company manufactures one product that is sold for $71 per unit in two geographic regions—the East and West regions. The following information pertains to the company’s first year of operations in which it produced 54,000 units and sold 49,000 units.
| Variable costs per unit: | |||
| Manufacturing: | |||
| Direct materials | $ | 22 | |
| Direct labor | $ | 12 | |
| Variable manufacturing overhead | $ | 3 | |
| Variable selling and administrative | $ | 5 | |
| Fixed costs per year: | |||
| Fixed manufacturing overhead | $ | 864,000 | |
| Fixed selling and administrative expenses | $ | 586,000 | |
The company sold 36,000 units in the East region and 13,000 units in the West region. It determined that $280,000 of its fixed selling and administrative expenses is traceable to the West region, $230,000 is traceable to the East region, and the remaining $76,000 is a common fixed cost. The company will continue to incur the total amount of its fixed manufacturing overhead costs as long as it continues to produce any amount of its only product.
1.) Diego is considering eliminating the West region because an internally generated report suggests the region’s total gross margin in the first year of operations was $46,000 less than its traceable fixed selling and administrative expenses. Diego believes that if it drops the West region, the East region's sales will grow by 5% in Year 2. Using the contribution approach for analyzing segment profitability and assuming all else remains constant in Year 2, what would be the profit impact of dropping the West region in Year 2?
2.) Assume the West region invests $44,000 in a new advertising campaign in Year 2 that increases its unit sales by 20%. If all else remains constant, what would be the profit impact of pursuing the advertising campaign?
In: Accounting
The Matsui Lubricants plant uses the weighted-average method to account for its work-in-process inventories. The accounting records show the following information for a particular day:
| Beginning WIP inventory | |||
| Direct materials | $ | 991 | |
| Conversion costs | 422 | ||
| Current period costs | |||
| Direct materials | 19,406 | ||
| Conversion costs | 11,331 | ||
Quantity information is obtained from the manufacturing records and includes the following:
| Beginning inventory | 950 | units | (60% complete as
to materials, 56% complete as to conversion) |
| Current period units started | 5,000 | units | |
| Ending inventory | 1,200 | units | (40% complete as
to materials, 30% complete as to conversion) |
Compute the cost of goods transferred out and the ending inventory using the weighted-average method. (Do not round intermediate calculations.)
COST OF GOODS
TRANFERRED OUT ???????
COSTS IN ENDING INVENTORY ??????
In: Accounting
An audit firm must evaluate the client and the engagement according to professional standards. Do you feel that the full evaluation must be done on both new and existing clients? Do you think this evaluation is an effective method to assess clients
In: Accounting
Miller Outdoor Equipment (MOE) makes four models of tents. The model names are Rookie, Novice, Hiker, and Expert. MOE manufactures the tents in two departments: Stitching and Customizing. All four models are processed initially in Stitching where all material is assembled and sewn into a basic tent. The Rookie model is then transferred to finished goods. After processing in Stitching, the other three models are transferred to Customizing for additional add-ons, and then transferred to finished goods.
There were no beginning work-in-process inventories on August 1. Data for August are shown in the following table. Ending work in process is 30 percent complete in Stitching and 30 percent complete in Customizing. Conversion costs are allocated based on the number of equivalent units processed in each department.
| Total | Rookie | Novice | Hiker | Expert | |||||||||||
| Units started | 620 | 500 | 470 | 200 | |||||||||||
| Units completed in Stitching | 545 | 445 | 410 | 165 | |||||||||||
| Units completed in Customizing | 425 | 385 | 140 | ||||||||||||
| Materials | $ | 58,060 | $ | 17,360 | $ | 12,500 | $ | 18,800 | $ | 9,400 | |||||
| Conversion costs: | |||||||||||||||
| Stitching | $ | 58,260 | |||||||||||||
| Customizing | 28,000 | ||||||||||||||
| Total conversion costs | $ | 86,260 | |||||||||||||
Required:
a.
What is the unit cost of each model transferred to finished goods
in August? (Round intermediate calculations to nearest
whole number.)
PROUCT UNIT COST
ROOKIE ????
NOVICE ?????
HIKER ?????
EXPERT ??????
What is the balance of
the Work-in-Process Inventory on August 31 for Stitching? For
Customizing? (Round intermediate calculations to nearest
whole number.)
WORK IN PROCESS INVENTORY
STITCHING ?????
CUSTOMIZING ???????????
I AM REUESTING HELP WITH THE ONES WITH QUESTION MARKS I AM LOST ON THIS
In: Accounting
Ratios from Comparative and Common-Size
Data
Consider the following financial statements for Waverly Company.
During 2013, management obtained additional bond financing to
enlarge its production facilities. The company faced higher
production costs during the year for such things as fuel,
materials, and freight. Because of temporary government price
controls, a planned price increase on products was delayed several
months.
As a holder of both common and preferred stock, you decide to
analyze the financial statements:
| WAVERLY COMPANY Balance Sheets (Thousands of Dollars) |
||
|---|---|---|
| Dec. 31, 2013 | Dec. 31, 2012 | |
| Assets | ||
| Cash and cash equivalents | $20,000 | $14,000 |
| Accounts receivable (net) | 57,000 | 45,000 |
| Inventory | 122,000 | 107,000 |
| Prepaid expenses | 20,000 | 14,000 |
| Plant and other assets (net) | 471,000 | 411,000 |
| Total Assets | $690,000 | $591,000 |
| Liabilities and Stockholders' Equity | ||
| Current liabilities | $92,000 | $84,000 |
| 10% Bonds payable | 227,000 | 162,000 |
| 9% Preferred stock, $50 Par Value | 77,000 | 77,000 |
| Common stock, $10 Par Value | 200,000 | 200,000 |
| Retained earnings | 94,000 | 68,000 |
| Total Liabilities and Stockholders' Equity | $690,000 | $591,000 |
| WAVERLY COMPANY Income Statements (Thousands of Dollars) |
||
|---|---|---|
| 2013 | 2012 | |
| Sales revenue | $822,000 | $680,000 |
| Cost of goods sold | 543,200 | 435,920 |
| Gross profit on sales | 278,800 | 244,080 |
| Selling and administrative expenses | 171,400 | 149,200 |
| Income before interest expense and income taxes | 107,400 | 94,880 |
| Interest expense | 24,500 | 18,000 |
| Income before income taxes | 82,900 | 76,880 |
| Income tax expense | 22,900 | 21,300 |
| Net income | $60,000 | $55,580 |
| Other financial data (thousands of dollars) | ||
| Cash provided by operating activities | $65,200 | $60,500 |
| Preferred stock dividends | 6,750 | 6,750 |
Required
a. Calculate the following for each year: current ratio, quick
ratio, operating-cash-flow-to-current liabilities ratio (current
liabilities were $78,000,000 at January 1, 2012), inventory
turnover (inventory was $87,000,000 at January 1, 2012),
debt-to-equity ratio, times-interest-earned ratio, return on assets
(total assets were $493,000,000 at January 1, 2012), and return on
common stockholders' equity (common stockholders' equity was
$236,000,000 at January 1, 2012).
b. Calculate common-size percentages for each year's income
statement.
a. Round answers to two decimal places.
| 2013 | 2012 | |
|---|---|---|
| Current ratio: | Answer | Answer |
| Quick ratio: | Answer | Answer |
| Operating-cash-flow-to-current-liabilities ratio: | Answer | Answer |
| Inventory turnover: | Answer | Answer |
| Debt-to-equity ratio: | Answer | Answer |
| Times-interest-earned ratio: | Answer | Answer |
| Return on assets: | Answer % | Answer % |
| Return on common stockholders' equity: | Answer % | Answer % |
b. Round answers to one decimal place.
| Common-Size Percentages | ||
|---|---|---|
| 2013 | 2012 | |
| Sales revenue | Answer % | Answer % |
| Cost of goods sold | Answer % | Answer % |
| Gross profit on sales | Answer % | Answer % |
| Selling and administrative expenses | Answer % | Answer % |
| Income before interest expense and income taxes | Answer % | Answer % |
| Interest expense | Answer % | Answer % |
| Income before income taxes | Answer % | Answer % |
| Income tax expense | Answer % | Answer % |
| Net income | Answer % | Answer % |
In: Accounting
Assume that instead of using its current accounting policy for warranties, Tesla instead expensed all warranty costs as costs were incurred. Estimate the Income (Loss) from operations that Tesla would have reported for 2014 ?
In: Accounting
In: Accounting
In the case of Kimbrell’s of Sanford, Inc. v. KPS, Inc.:
a. Kimbrell’s was required to file a financing statement to perfect it security interest.
b. Burns signed a security agreement granting Kimbrell’s a purchase money security interest in the VCR.
c. Kimbrell’s was not entitled to recover possession of the VCR when it filed its cause of action.
d. Kimbrell’s filed a financial statement to perfect its purchase money security interest in the VCR.
In: Accounting
Problem 7-25A Schedule of Expected Cash Collections; Cash Budget [LO7-2, LO7-8]
|
Herbal Care Corp., a distributor of herb-based sunscreens, is ready to begin its third quarter, in which peak sales occur. The company has requested a $40,000, 90-day loan from its bank to help meet cash requirements during the quarter. Since Herbal Care has experienced difficulty in paying off its loans in the past, the loan officer at the bank has asked the company to prepare a cash budget for the quarter. In response to this request, the following data have been assembled: |
| a. | On July 1, the beginning of the third quarter, the company will have a cash balance of $41,500. |
| b. |
Actual sales for the last two months and budgeted sales for the third quarter follow (all sales are on account): |
| May (actual) | $ | 170,000 |
| June (actual) | $ | 210,000 |
| July (budgeted) | $ | 330,000 |
| August (budgeted) | $ | 550,000 |
| September (budgeted) | $ | 285,000 |
|
Past experience shows that 25% of a month’s sales are collected in the month of sale, 70% in the month following sale, and 3% in the second month following sale. The remainder is uncollectible. |
| c. | Budgeted merchandise purchases and budgeted expenses for the third quarter are given below: |
| July | August | September | |||||||
| Merchandise purchases | $ | 198,000 | $ | 330,000 | $ | 171,000 | |||
| Salaries and wages | $ | 36,500 | $ | 41,000 | $ | 42,000 | |||
| Advertising | $ | 115,000 | $ | 111,500 | $ | 82,000 | |||
| Rent payments | $ | 5,200 | $ | 5,200 | $ | 5,200 | |||
| Depreciation | $ | 5,250 | $ | 5,250 | $ | 5,250 | |||
|
Merchandise purchases are paid in full during the month following purchase. Accounts payable for merchandise purchases on June 30, which will be paid during July, total $126,000. |
|
| d. |
Equipment costing $10,000 will be purchased for cash during July. |
| e. |
In preparing the cash budget, assume that the $40,000 loan will be made in July and repaid in September. Interest on the loan will total $1,200. |
| Required: | |
| 1. |
Prepare a schedule of expected cash collections for July, August, and September and for the quarter in total. |
| 2. |
Prepare a cash budget, by month and in total, for the third quarter. (Cash deficiency, repayments and interest should be indicated by a minus sign.) |
In: Accounting
Please explain the difference between a deduction and a credit.Which are the refundable credits?Why do you think we have refundable credits?
In: Accounting