1.

Copy Center pays an average wage of $13 per hour to employees for printing and copying jobs, and allocates $18 of overhead for each employee hour worked. Direct materials are assigned to each job according to actual cost. Jobs are marked up 20% above total manufacturing cost to determine the selling price. If Job M-47 used $370 of direct materials and took 15 direct hours of labor to complete, what is the selling price of the job?

rev: 11_20_2019_QC_CS-191445

• $912.

• $768.

• $678.

• $1,002.

ob A3B was ordered by a customer on September 25. During the month of September, Jaycee Corporation requisitioned $2,600 of direct materials and used $4,100 of direct labor. The job was not finished by the end of September, but needed an additional $3,100 of direct materials in October and additional direct labor of $6,600 to finish the job. The company applies overhead at the end of each month at a rate of 150% of the direct labor cost. What is the amount of job costs added to Work in Process Inventory during October?

• $16,400

• $23,700

• $29,400

• $32,450

• $19,600

3.

Mango Company applies overhead based on direct labor costs. For the current year, Mango Company estimated total overhead costs to be $380,000, and direct labor costs to be $190,000. Actual overhead costs for the year totaled $406,000, and actual direct labor costs totaled $214,000. At year-end, the balance in the Factory Overhead account is a:

• $22,000 Debit balance.

• $428,000 Credit balance.

• $406,000 Debit balance.

• $22,000 Credit balance.

• $214,000 Debit balance.

White Diamond Flour Company manufactures flour by a series of three processes, beginning with wheat grain being introduced in the Milling Department. From the Milling Department, the materials pass through the Sifting and Packaging departments, emerging as packaged refined flour.

The balance in the account Work in Process-Sifting Department was as follows on July 1, 2016:

The following costs were charged to Work in Process-Sifting Department during July:

During July, 14,400 units of flour were completed. Work in Process-Sifting Department on July 31 was 1,600 units, 4545 completed.

Chart of Accounts

Cost of Production Report

1. Prepare a cost of production report for the Sifting Department for July.

Journal

2. Journalize the entries for costs transferred from Milling to Sifting and the costs transferred from Sifting to Packaging. Refer to the Chart of Accounts for correct wording of account titles.

PAGE 10

JOURNAL

Final Questions

3. Determine the increase or decrease in the cost per equivalent unit from June to July for direct materials and conversion costs.

4. The cost of production report may be used as the basis for allocating product costs between ________ and ________ . The report can also be used to control costs by holding each department head responsible for the units entering production and the costs incurred in the department. Any differences in unit product costs from one month to another, such as those in part (3), can be studied carefully and any significant differences investigated.

Thornton Corporation estimated its overhead costs would be $23,300 per month except for January when it pays the $182,880 annual insurance premium on the manufacturing facility. Accordingly, the January overhead costs were expected to be $206,180 ($182,880 + $23,300). The company expected to use 7,900 direct labor hours per month except during July, August, and September when the company expected 9,100 hours of direct labor each month to build inventories for high demand that normally occurs during the Christmas season. The company’s actual direct labor hours were the same as the estimated hours. The company made 3,950 units of product in each month except July, August, and September, in which it produced 4,550 units each month. Direct labor costs were $24.00 per unit, and direct materials costs were $10.20 per unit.


Required

1. Calculate a predetermined overhead rate based on direct labor hours.

2. Determine the total allocated overhead cost for January, March, and August.

3. Determine the cost per unit of product for January, March, and August.

4. Determine the selling price for the product, assuming that the company desires to earn a gross margin of $21.30 per unit.

Required information

[The following information applies to the questions displayed below.]

Hart Company made 4,900 bookshelves using 22,000 board feet of wood costing $261,800. The company's direct materials standards for one bookshelf are 5 board feet of wood at $11.80 per board foot.

(1) Compute the direct materials price and quantity variances incurred in manufacturing these bookshelves.

AQ = Actual Quantity
SQ = Standard Quantity
AP = Actual Price
SP = Standard Price

Reed Corp. has set the following standard direct materials and direct labor costs per unit for the product it manufactures.

During June the company incurred the following actual costs to produce 8,500 units.

AQ = Actual Quantity
SQ = Standard Quantity
AP = Actual Price
SP = Standard Price

AH = Actual Hours
SH = Standard Hours
AR = Actual Rate
SR = Standard Rate

(1) Compute the direct materials price and quantity variances.
(2) Compute the direct labor rate variance and the direct labor efficiency variance. Indicate whether each variance is favorable or unfavorable.

The December 31, 20X8, balance sheets for Pint Corporation and its 70 percent-owned subsidiary Saloon Company contained the following summarized amounts:

Pint acquired the shares of Saloon Company on January 1, 20X7. On December 31, 20X8, assume Pint sold inventory to Saloon during 20X8 for $111,000 and Saloon sold inventory to Pint for $303,000. Pint’s balance sheet contains inventory items purchased from Saloon for $99,000. The items cost Saloon $59,000 to produce. In addition, Saloon’s inventory contains goods it purchased from Pint for $33,000 that Pint had produced for $19,800. Assume Saloon reported net income of $73,000 and dividends of $14,600.

Required:
a. Prepare all consolidation entries needed to complete a consolidated balance sheet worksheet as of December 31, 20X8. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not round intermediate calculations.)

b. Prepare a consolidated balance sheet worksheet as of December 31, 20X8. (Do not round intermediate calculations. Values in the first two columns (the "parent" and "subsidiary" balances) that are to be deducted should be indicated with a minus sign, while all values in the "Consolidation Entries" columns should be entered as positive values. For accounts where multiple adjusting entries are required, combine all debit entries into one amount and enter this amount in the debit column of the worksheet. Similarly, combine all credit entries into one amount and enter this amount in the credit column of the worksheet.)

Amalgamated General Corporation is a consulting firm that also offers financial services through its credit division. From time to time the company buys and sells securities. The following selected transactions relate to Amalgamated’s investment activities during the last quarter of 2018 and the first month of 2019. The only securities held by Amalgamated at October 1 were $55 million of 10% bonds of Kansas Abstractors, Inc., purchased on May 1 at face value and held in Amalgamated’s trading portfolio. The company’s fiscal year ends on December 31.

Required:
Prepare the appropriate journal entry for each transaction or event.

Tempo Company's fixed budget (based on sales of 12,000 units) for the first quarter of calendar year 2017 reveals the following.

Complete the following flexible budgets for sales volumes of 10,000, 12,000, and 14,000 units. (Round cost per unit to 2 decimal places.)

On January 1, 2017, Waterway Corporation issued $3,680,000 of 10-year, 8% convertible debentures at 102. Interest is to be paid semiannually on June 30 and December 31. Each $1,000 debenture can be converted into 8 shares of Waterway Corporation $100 par value common stock after December 31, 2018.

On January 1, 2019, $368,000 of debentures are converted into common stock, which is then selling at $110. An additional $368,000 of debentures are converted on March 31, 2019. The market price of the common stock is then $116. Accrued interest at March 31 will be paid on the next interest date.

Bond premium is amortized on a straight-line basis.

Make the necessary journal entries for:

record conversions using the book value method.

You and your team have completed your fieldwork and have a handful of other considerations before you compete the audit and issue your report. These activities are designed to ensure nothing significant has occurred between the completion of your fieldwork and the issuing of the audit report. You are assigned as a senior on the staff, in line to be promoted to manager, to instruct the other staff on the importance of considering contingent liabilities, letters from client lawyers, and subsequent events. Create a 10- to 12-slide presentation for the staff. Explain the importance of reviewing for contingent liabilities and subsequent events. Describe the requirements for reviewing for contingent liabilities and subsequent events.

Step 7 only please. Thank you!

Introduction

You are a financial planner and a new client, Kristina came to your office with the following question: How much should she save annually given her goals?

• Kristina is saving for two goals: one is to fund her child Katryna’s college education and the other is to retire.
• Katryna will begin college in exactly 18 years, and Kristina will retire on the same day.
• College costs for state institutions are currently running at $6,000 per year, and have historically increased at a rate of 5% per year.
• Kristina will pay for a 4-year undergraduate education.
• Kristina estimates she will live 30-year past her retirement, during which time she would like to pay herself a $60,000 per year salary (first payment occurs at the end of year 18, or beginning of year 19).
• On the day she retires, Kristina would like to pay cash for a BMW Z4 convertible or whatever similar model BMW produces at that time. A Z4 cost $55,000 and BMW has increased price at a rate of 7% per year.
• Kristina will save annually beginning in exactly one year—18 equal payments spread over time.
• The date of the last savings installment coincides with the first tuition payment (and the day of Kristina retirement).
• Kristina estimates an 8% expected return on all investments over the period.
• How much does she have to save each year to accomplish the above goals?

Step 1: What will be the value of the Z4 of equivalent at the time of purchase? 10 points

Step 2: What will be the value of the 4 annual tuition payments? 15 points

Step 3: What will be the present value of the 4 annual tuition payments? 10 points

Step 4: What will be the present value of the 30 years of salary payments? 10 points

Step 5: What will be the value of Kristina’s savings when she retires? 10 points

Step 6: How much does Kristina need to save every year? 10 points

Step 7: Create a table showing all the additions and subtraction to the savings accounts and the value at the end of each year. (Hint: the value should be close to zero at the end) 25 points

Lubricants, Inc., produces a special kind of grease that is widely used by race car drivers. The grease is produced in two processing departments—Refining and Blending. Raw materials are introduced at various points in the Refining Department.

The following incomplete Work in Process account is available for the Refining Department for March:

The March 1 work in process inventory in the Refining Department consists of the following elements: materials, $8,400; direct labor, $4,100; and overhead, $21,700.

Costs incurred during March in the Blending Department were: materials used, $44,000; direct labor, $17,300; and overhead cost applied to production, $102,000.

Required:

1. Prepare journal entries to record the costs incurred in both the Refining Department and Blending Department during March. Key your entries to the items (a) through (g) below.

1. Raw materials used in production.
2. Direct labor costs incurred.
3. Manufacturing overhead costs incurred for the entire factory, $676,000. (Credit Accounts Payable.)
4. Manufacturing overhead was applied to production using a predetermined overhead rate.
5. Units that were complete with respect to processing in the Refining Department were transferred to the Blending Department, $662,000.
6. Units that were complete with respect to processing in the Blending Department were transferred to Finished Goods, $710,000.
7. Completed units were sold on account, $1,470,000. The Cost of Goods Sold was $680,000.

2. Post the journal entries from (1) above to T-accounts. The following account balances existed at the beginning of March. (The beginning balance in the Refining Department’s Work in Process is given in the T-account shown above.)

Weston Products manufactures an industrial cleaning compound that goes through three processing departments—Grinding, Mixing, and Cooking. All raw materials are introduced at the start of work in the Grinding Department. The Work in Process T-account for the Grinding Department for May is given below:

The May 1 work in process inventory consisted of 98,000 pounds with $147,000 in materials cost and $106,820 in conversion cost. The May 1 work in process inventory was 100% complete with respect to materials and 30% complete with respect to conversion. During May, 351,000 pounds were started into production. The May 31 inventory consisted of 108,000 pounds that were 100% complete with respect to materials and 70% complete with respect to conversion. The company uses the weighted-average method in its process costing system.

Required:

1. Compute the Grinding Department's equivalent units of production for materials and conversion in May.

2. Compute the Grinding Department's costs per equivalent unit for materials and conversion for May.

3. Compute the Grinding Department's cost of ending work in process inventory for materials, conversion, and in total for May.

4. Compute the Grinding Department's cost of units transferred out to the Mixing Department for materials, conversion, and in total for May.

Scenario 1 - Ethical Dilemma - Reclassify Employees

You are on the management team of Crystal Clear Electronics (CCE) Inc., a company that specializes in high-quality home theater systems. In addition to selling these systems, CCE provides custom installation on all purchases and is known for the professionalism of its installation staff. This reputation is due to the rigorous policies its home installation staff must follow. All employees are required to attend bi-monthly training sessions, wear CCE uniforms, observe the installation dates and times agreed on by CCE and the customer, and follow any instructions given by CCE as to how to perform the installation.

Faced with shrinking margins and cash flow problems, CCE is looking to cut costs and increase cash flows. You realize that by reclassifying the installation staff as independent contractors, CCE will be able to accomplish both objectives. Because the installation staff would be independent contractors, the company would not have to pay payroll taxes, social security, and Medicare expenses. The reduction in these costs and the corresponding increase in cash flow would certainly help the company's liquidity. Furthermore, such a change would not affect the quality of the service provided and would be virtually invisible to customers.

Question: Discuss the ethical implications of this reclassification.