What decisions on the basis of this information, including the same data for the previous period and possibly two years prior, can investors or shareholders take (focus on future growth, evolution of risk level, or volatility of future earnings and evolution of the 'time horizon of visibility' into the firm's future)?

Cain Components manufactures and distributes various plumbing products used in homes and other buildings. Over time, the production staff has noticed that products they considered easy to make were difficult to sell at margins considered reasonable, while products that seemed to take a lot of staff time were selling well despite recent price increases. A summer intern has suggested that the cost system might be providing misleading information.

The controller decided that a good summer project for the intern would be to develop, in one self-contained area of the plant, an alternative cost system with which to compare the current system. The intern identified the following cost pools and, after discussion with some plant personnel, appropriate cost drivers for each pool. There were:

In this particular area, Cain produces two of its many products: Standard and Deluxe. The following are data for production for the latest full year of operations.

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?

Direct Costs: Standard? Deluxe?

Overhead: Standard? Deluxe?

Number of Units: Standard? Deluxe?

b. The intern suggests an ABC system using the cost drivers identified above. What unit product costs will be reported for the two products if the ABC system is used?

Direct Costs: Standard? Deluxe?

Receiving: Standard? Deluxe?

Manufacturing: Standard? Deluxe?

Machine Set Up: Standard? Deluxe?

Shipping: Standard? Deluxe?

Number of Units: Standard? Deluxe?

Christopher’s Custom Cabinet Company uses a job order cost system with overhead applied as a percentage of direct labor costs. Inventory balances at the beginning of 2016 follow:

The following transactions occurred during January:
(a) Purchased materials on account for $26,800.
(b) Issued materials to production totaling $21,000, 90 percent of which was traced to specific jobs and the remainder of which was treated as indirect materials.
(c) Payroll costs totaling $18,400 were recorded as follows:
    $10,100 for assembly workers
     2,500 for factory supervision
     2,700 for administrative personnel
      3,100 for sales commissions
(d) Recorded depreciation: $5,000 for machines, $1,100 for the copier used in the administrative office.
(e) Recorded $1,800 of expired insurance. Forty percent was insurance on the manufacturing facility, with the remainder classified as an administrative expense.
(f) Paid $5,600 in other factory costs in cash.
(g) Applied manufacturing overhead at a rate of 200 percent of direct labor cost.
(h) Completed all jobs but one; the job cost sheet for this job shows $2,200 for direct materials, $2,100 for direct labor, and $4,200 for applied overhead.
(i) Sold jobs costing $50,200. The revenue earned on these jobs was $65,260.

Required:
1. Set up T-accounts, record the beginning balances, post the January transactions, and compute the final balance for the following accounts: (Post all amounts separately. Do not combine/add any dollar amounts when posting to the t-accounts.)

1. Raw Materials Inventory.
2. Work in Process Inventory.
3. Finished Goods Inventory.
4. Cost of Goods Sold.
5. Selling, General, and Administrative Expenses.
6. Sales Revenue.
7. Other accounts (Cash, Payables, etc.).

2. Determine how much gross profit the company would report during the month of January before any adjustment is made for the overhead balance.



3. Determine the amount of over- or underapplied overhead.



4. Compute adjusted gross profit assuming that any over- or underapplied overhead balance is adjusted directly to Cost of Goods Sold.

Please Answer in Detail

Question 01: Qualitative characteristics of accounting information relates to the second level of conceptual framework. Discuss in detail, the primary qualitative characteristics relating to the content and presentation of information with particular emphasis to their importance.

.

Question 02: Financial statements prepared under historical cost convention do not have regard for changes in price levels and therefore do not reflect financial realities. Discuss six limitations that statements prepared by historical cost accounting possess that reduce their utility to the users.

Bob Stone, Inc., budgets the following amounts for its Buildings & Grounds and Computer Services Departments in servicing each other and the two manufacturing divisions of Signs and Mailers:  

If you are using the step down method to allocate support department costs which of the support departments would you allocate the costs from second:

Kingbird Corporation was organized on January 1, 2017. It is authorized to issue 9,600 shares of 8%, $100 par value preferred stock, and 501,500 shares of no-par common stock with a stated value of $1 per share. The following stock transactions were completed during the first year.

Prepare the journal entries to record the above transactions. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Stamboul Company lists the following condensed balance sheet as of the beginning of 2016:

Stamboul is considering the impact of various types of dividends on this balance sheet. Each dividend would be declared and paid in 2016. These include:

Required:

Olivia’s Outdoor Essentials produces gear for climbing, hiking, and camping. Last month, Olivia reported the following: Beginning Work in Process Inventory: $20,000 Ending Work in Process Inventory: $25,000 Beginning Finished Goods Inventory: $15,000 Ending Finished Goods Inventory: $13,000 Direct Labor: $60,000 Beginning Raw Materials Inventory: $20,000 New Raw Materials Purchased: $48,000 Ending Raw Materials Inventory: $10,000 Indirect Materials Used: $8,000 Indirect Labor: $10,000 Other Applied Manufacturing Overhead: $30,000

Required:

a. What was the Manufacturing Costs for the period?

b. What was the Cost of Goods Manufactured for the period?

c. What was the Cost of Goods Sold for the period?

Fairness of the Federal Estate Tax"

• Based on the information contained in the textbook, several arguments exist for the repeal of the estate tax. Using the Strayer Library or an Internet search, find an article from within the last three (3) years that makes a case for or against repealing estate taxes. Provide the link to the article, as well as a summary of its key ideas. Finally, share whether you agree or disagree with the concepts in the article. Justify your response.
• need to discussion

Discuss "Overhead Costs" and the difficulty it causes when dealing with manufacturing costs.

Sandra’s Purse Boutique has the following transactions related to its top-selling Gucci purse for the month of October. Sandra's Purse Boutique uses a periodic inventory system.

1. Calculate ending inventory and cost of goods sold at October 31, using the specific identification method. The October 4 sale consists of purses from beginning inventory, the October 13 sale consists of one purse from beginning inventory and two purses from the October 10 purchase, and the October 28 sale consists of three purses from the October 10 purchase and four purses from the October 20 purchase.

Ending Inventory=

Cost of Goods Sold=

2. Using FIFO, calculate ending inventory and cost of goods sold at October 31.

Ending Inventory=

Cost of Goods Sold=

3. Using LIFO, calculate ending inventory and cost of goods sold at October 31.

Ending Inventory=

Cost of Goods Sold=

4. Using weighted-average cost, calculate ending inventory and cost of goods sold at October 31. (Do not round intermediate calculations. Round your final answers to 2 decimal places.)

Ending Inventory=

Cost of Goods Sold=

You have decided to open three snow cone stands for the summer, have hired college kids, and are using cash registers as outlined (you have a key to the cash register at each location, and so does the lead employee for each shift). You want to make sure that the sales are properly controlled. In your initial post, write a list of procedures for employees when ringing in sales and giving change, and then articulate the role of the lead employee at the end of the day.

During 2019 Canada Computer Company sold computers for $100,000 which includes a 2-year warranty. Warranties sold separately for $70,000 that requires the company to perform periodic services and to replace defective parts. In 2020, Canada Computer Company incurred actual warranty costs relative to 2019 computer sales of $5,000 for parts and $12,000 for labor.                                                                                            

Instructions

(a) Using the revenue warranty approach, prepare the entries to reflect the above transactions for 2019 and 2020. assuming Canada co. earn any unearned warranties equally over warranty life.

(b) The transactions of part (a) create what balance under current liabilities in the Dec 31, 2019 balance sheet?

38) Trent Corp. issued $800,000 of 8%, 5-year bonds at 102 on January 1, 2017. The straight-line method of amortization is used and the bonds pay interest annually on January 1. The amount of bond interest expense that Trent should report on its December 31, 2017, income statement is

Select one:

a. $60,800.

b. $67,200.

c. $65,280.

d. $64,000.

Solomon Construction Company expects to build three new homes during a specific accounting period. The estimated direct materials and labor costs are as follows:

Assume Solomon needs to allocate two major overhead costs ($70,600 of employee fringe benefits and $29,540 of indirect materials costs) among the three jobs.

Required

Choose an appropriate cost driver for each of the overhead costs and determine the total cost of each house. (Round "Allocation rate" to 2 decimal places.)