Miller Toy Company manufactures a plastic swimming pool at its Westwood Plant. The plant has been experiencing problems as shown by its June contribution format income statement below:

*Contains direct materials, direct labor, and variable manufacturing overhead.

Janet Dunn, who has just been appointed general manager of the Westwood Plant, has been given instructions to “get things under control.” Upon reviewing the plant’s income statement, Ms. Dunn has concluded that the major problem lies in the variable cost of goods sold. She has been provided with the following standard cost per swimming pool:

*Based on machine-hours.

During June, the plant produced 5,000 pools and incurred the following costs:

1. Purchased 24,500 pounds of materials at a cost of $2.95 per pound.

2. Used 19,300 pounds of materials in production. (Finished goods and work in process inventories are insignificant and can be ignored.)

3. Worked 4,600 direct labor-hours at a cost of $7.70 per hour.

4. Incurred variable manufacturing overhead cost totaling $5,070 for the month. A total of 1,300 machine-hours was recorded.

It is the company’s policy to close all variances to cost of goods sold on a monthly basis.

Required:

1. Compute the following variances for June:

a. Materials price and quantity variances.

b. Labor rate and efficiency variances.

c. Variable overhead rate and efficiency variances.

2. Summarize the variances that you computed in (1) above by showing the net overall favorable or unfavorable variance for the month.

Abigail Henderson has ​$ budgeted for spending money on an upcoming trip to Country A and Country B. Country​ A's currency is trading at ​$ per currency​ A, and Country​ B's currency is trading at ​$ per currency B. She plans to spend more time in Country​ A, so she wants to have times as much of currency A as currency B. Set up and solve a system of equations to model this​ problem, and explain what the answer means in practical terms.

Complete the equation that represents the total cost of purchasing currency. Let x be the number of currency A and y the number of currency B. nothing

The following transactions apply to Jova Company for Year 1, the first year of operation:

Issued $15,500 of common stock for cash.

Recognized $64,500 of service revenue earned on account.

Collected $57,600 from accounts receivable.

Paid operating expenses of $36,000.

Adjusted accounts to recognize uncollectible accounts expense. Jova uses the allowance method of accounting for uncollectible accounts and estimates that uncollectible accounts expense will be 2 percent of sales on account.

The following transactions apply to Jova for Year 2:

Recognized $72,000 of service revenue on account.

Collected $65,600 from accounts receivable.

Determined that $890 of the accounts receivable were uncollectible and wrote them off.

Collected $300 of an account that had previously been written off.

Paid $48,400 cash for operating expenses.

Adjusted the accounts to recognize uncollectible accounts expense for Year 2. Jova estimates uncollectible accounts expense will be 1 percent of sales on account.

Required Complete the following requirements for Year 1 and Year 2. Complete all requirements for Year 1 prior to beginning the requirements for Year 2. d-1.

Prepare the income statement, statement of changes in stockholders’ equity, balance sheet, and statement of cash flows for Year 1.

Crystal Displays Inc. recently began production of a new product, flat panel displays, which required the investment of $1,400,000 in assets. The costs of producing and selling 5,000 units of flat panel displays are estimated as follows:

Crystal Displays Inc. is currently considering establishing a selling price for flat panel displays. The president of Crystal Displays has decided to use the cost-plus approach to product pricing and has indicated that the displays must earn a 11% rate of return on invested assets.

I NEED THE DIFFERENTIAL ANALYSIS DONE PLEASE!!! IF YOU DO ANY PART OF THIS AT ALL PLEASE DO THE DIFFERENCIAL ANALYSIS!!

6. A. Prepare a differential analysis of the proposed sale to Maple Leaf Visual Inc. Refer to the lists of Labels and Amount Descriptions for the exact wording of the answer choices for text entries. For those boxes in which you must enter subtracted or negative numbers use a minus sign. If there is no amount or an amount is zero, enter “0”. A colon (:) will automatically appear if required.

Question not attempted.

Score: 0/53

THIS!!! THANK YOU.

Evidence is defined as any information used by the auditor to determine whether the
information being audited is stated in accordance with the established criteria.
i. Discuss the meaning of ‘appropriateness and ‘sufficiency’ of audit evidence.
[3 marks]

ii. Briefly explain on the following audit procedures:
a. Documentation.
b. Examination of physical assets.
c. Analytical procedures.
d. Inquiry.
f. Confirmation.

Pittman Company is a small but growing manufacturer of telecommunications equipment. The company has no sales force of its own; rather, it relies completely on independent sales agents to market its products. These agents are paid a sales commission of 15% for all items sold.

Barbara Cheney, Pittman’s controller, has just prepared the company’s budgeted income statement for next year as follows:

*Primarily depreciation on storage facilities.

As Barbara handed the statement to Karl Vecci, Pittman’s president, she commented, “I went ahead and used the agents’ 15% commission rate in completing these statements, but we’ve just learned that they refuse to handle our products next year unless we increase the commission rate to 20%.”

“That’s the last straw,” Karl replied angrily. “Those agents have been demanding more and more, and this time they’ve gone too far. How can they possibly defend a 20% commission rate?”

“They claim that after paying for advertising, travel, and the other costs of promotion, there’s nothing left over for profit,” replied Barbara.

“I say it’s just plain robbery,” retorted Karl. “And I also say it’s time we dumped those guys and got our own sales force. Can you get your people to work up some cost figures for us to look at?”

“We’ve already worked them up,” said Barbara. “Several companies we know about pay a 7.5% commission to their own salespeople, along with a small salary. Of course, we would have to handle all promotion costs, too. We figure our fixed expenses would increase by $2,475,000 per year, but that would be more than offset by the $3,300,000 (20% × $16,500,000) that we would avoid on agents’ commissions.”

The breakdown of the $2,475,000 cost follows:

“Super,” replied Karl. “And I noticed that the $2,475,000 equals what we’re paying the agents under the old 15% commission rate.”

“It’s even better than that,” explained Barbara. “We can actually save $75,900 a year because that’s what we’re paying our auditors to check out the agents’ reports. So our overall administrative expenses would be less.”

“Pull all of these numbers together and we’ll show them to the executive committee tomorrow,” said Karl. “With the approval of the committee, we can move on the matter immediately.”

Required:

1. Compute Pittman Company’s break-even point in dollar sales for next year assuming:

a. The agents’ commission rate remains unchanged at 15%.

b. The agents’ commission rate is increased to 20%.

c. The company employs its own sales force.

2. Assume that Pittman Company decides to continue selling through agents and pays the 20% commission rate. Determine the dollar sales that would be required to generate the same net income as contained in the budgeted income statement for next year.

3. Determine the dollar sales at which net income would be equal regardless of whether Pittman Company sells through agents (at a 20% commission rate) or employs its own sales force.

4. Compute the degree of operating leverage that the company would expect to have at the end of next year assuming:

a. The agents’ commission rate remains unchanged at 15%.

b. The agents’ commission rate is increased to 20%.

c. The company employs its own sales force.

Use income before income taxes in your operating leverage computation.

During Year 1 and Year 2, Agatha Corp. completed the following transactions relating to its bond issue. The corporation’s fiscal year is the calendar year.

Year 1

Jan. 1 Issued $310,000 of 10-year, 6 percent bonds for $298,000. The annual cash payment for interest is due on December 31.

Dec. 31 Recognized interest expense, including the straight-line amortization of the discount, and made the cash payment for interest.

Dec. 31 Closed the interest expense account.

Year 2

Dec. 31 Recognized interest expense, including the straight-line amortization of the discount, and made the cash payment for interest.

Dec. 31 Closed the interest expense account.

Required

a-1. When the bonds were issued, was the market rate of interest more or less than the stated rate of interest?

a-2. If Agatha had sold the bonds at their face amount, what amount of cash would Agatha have received?

b. Prepare the liabilities section of the balance sheet at December 31, Year 1 and Year 2.

c. Determine the amount of interest expense that will be reported on the income statements for Year 1 and Year 2.

d. Determine the amount of interest that will be paid in cash to the bondholders in Year 1 and Year 2.

. Lang Co. manufacturers its products in a continuous process involving two departments, Machining and Assembly. Present entries to record the following selected transactions related to production during June:

(a) Materials purchased on account, $225,000

(b) Materials requisitioned by; Machining, $73,000 direct and $9,000 indirect materials; Assembly, $4,900 indirect materials.

(c) Direct labor used by Machining, $23,000, Assembly $47,000.

(D) Depreciation expenses: Machining $2,000, Assembly $8,000

(e) Factory overhead applied: Machining $9,700, Assembly $11,300

(f) Machining Department transferred $98,300 to Assembly Department; Assembly Department transferred $83,400 to finished goods.

(g) Cost of goods sold $72,000

The accounting for investments in another entity's equity instruments depends mainly on

The fair value loss impairment model

Accumulated other comprehensive income includes

Regarding the reporting of investment income under the FV–NI method, for companies reporting in accordance with ASPE, which of the following statements is true?

Cost Department Allocations

In divisional income statements prepared for Demopolis Company, the Payroll Department costs are charged back to user divisions on the basis of the number of payroll distributions, and the Purchasing Department costs are charged back on the basis of the number of purchase requisitions. The Payroll Department had expenses of $64,560, and the Purchasing Department had expenses of $40,000 for the year. The following annual data for Residential, Commercial, and Government Contract divisions were obtained from corporate records:

Required:

a. Determine the total amount of payroll checks and purchase requisitions processed per year by the company and each division.

b. Using the cost driver information in (a), determine the annual amount of payroll and purchasing costs allocated to the Residential, Commercial, and Government Contract divisions from payroll and purchasing services. Do not round interim calculations. Round your answers to two decimal places.

c. Residential's support department allocations are   than the other two divisions because Residential is a   user of support department services. Residential has many employees on a weekly payroll, which translates into a   number of payroll transactions.

Sager Company manufactures variations of its product, a technopress, in response to custom orders from its customers. On May 1, the company had no inventories of work in process or finished goods but held the following raw materials.

On May 4, the company began working on two technopresses: Job 102 for Worldwide Company and Job 103 for Reuben Company.

1. Purchased raw materials on credit and recorded the following information from receiving reports and invoices.

Receiving Report No. 426, Material M, 250 units at $250 each.
Receiving Report No. 427, Material R, 90 units at $180 each.

Record these purchases with a single journal entry. Enter the receiving report information on the materials ledger cards.

2. Requisitioned the following raw materials for production.

Requisition No. 35, for Job 102, 135 units of Material M.
Requisition No. 36, for Job 102, 72 units of Material R.
Requisition No. 37, for Job 103, 70 units of Material M.
Requisition No. 38, for Job 103, 38 units of Material R.
Requisition No. 39, for 15 units of paint.

Enter amounts for direct materials requisitions on the materials ledger cards and the job cost sheets. Enter the indirect materials amount on the materials ledger card.

3. Received the following employee time tickets for work in May.

Time tickets Nos. 1 to 10 for direct labor on Job 102, $90,000.
Time tickets Nos. 11 to 30 for direct labor on Job 103, $65,000.
Time tickets Nos. 31 to 36 for equipment repairs, $19,250.

Record direct labor from the time tickets on the job cost sheets.

4. Paid cash for the following items during the month: factory payroll, $174,250, and miscellaneous overhead items, $102,000. Use the time tickets to record the total direct and indirect labor costs.
5. Finished Job 102 and transferred it to the warehouse. The company assigns overhead to each job with a predetermined overhead rate equal to 80% of direct labor cost.

Enter the allocated overhead on the cost sheet for Job 102, fill in the cost summary section of the cost sheets.

6. Delivered Job 102 and accepted the customer’s promise to pay $400,000 within 30 days.
7. Applied overhead cost to Job 103 based on the job’s direct labor to date.

Required:
Complete the materials ledger cards for Material M, Material R, and paint using the information given in part a and b. Complete the job cost sheets for Jobs 102 and 103 using the information given in part a, b, c and e. Prepare journal entries for part a through g.

Complete the job cost sheets for Jobs 102 and 103 using the information given in part a, b, c and e.

Chesterfield County had the following transactions.

1. A budget is passed for all ongoing activities. Revenue is anticipated to be $888,750 with approved spending of $583,000 and operating transfers out of $246,000.
2. A contract is signed with a construction company to build a new central office building for the government at a cost of $7,400,000 . A budget for this project has previously been recorded.
3. Bonds are sold for $7,400,000 (face value) to finance construction of the new office building.
4. The new building is completed. An invoice for $7,400,000 is received and paid.
5. Previously unrestricted cash of $1,250,000 is set aside to begin paying the bonds issued in (c).
6. A portion of the bonds comes due and $1,250,000 is paid. Of this total, $110,000 represents interest. The interest had not been previously accrued.
7. Citizens' property tax levies are assessed. Total billing for this tax is $845,000. On this date, the assessment is a legally enforceable claim according to the laws of this state. The money to be received is designated for the current period and 90 percent is assumed to be collectible in this period with receipt of an additional 6 percent during subsequent periods but in time to be available to pay current period claims. The remainder is expected to be uncollectible.
8. Cash of $165,000 is received from a toll road. This money is restricted for highway maintenance.
9. The county received investments valued at $335,000 as a donation from a grateful citizen. Income from these investments must be used to beautify local parks.

Prepare the entries first for fund financial statements and then for government-wide financial statements.

Office Works has an order to manufacture several specialty products. The beginning cash and equity balances were $105,000. All other beginning balances were $0. Use your T-Account worksheet to record the following transactions:

1. Purchased $50,000 of direct materials on account.
2. Used $45,000 direct materials in production during the month.
3. Manufacturing employees worked 6,400 hours and were paid at a rate of $8 per hour. Paid cash for the direct labor expense.

4. The company applies OH based on direct labor cost. This year's annual overhead is estimated to be $500,000. The actual direct   labor cost last year was $1,250,000. The company estimates it will spend $625,000 in labor cost this year.
5. Compute and record the OH applied to the job.
6. Completed units costing $50,000 during the month.
7. Sold 6,000 units costing $6.50 during the month. The selling price is 30% above cost. Received cash.
8. This year, the company paid $40,000 cash for actual OH expenses incurred. Last year the company paid $65,000 cash for OH expenses. Record the actual OH costs.
9. The company considers OH differences less than $4,000 to be immaterial. By how much was OH over applied or under applied? Record the difference.

Now, CHOOSE 6 CORRECT STATEMENTS from the choices below. You should have 6 check marks indicating your answer choices. Each answer choice is worth 4 points:

1. The predetermined overhead rate is?
2. The direct labor that is debited to labor expense is?
3. How much are the total current manufacturing costs?
4. How much revenue did the company earn?
5. By how much was MOH over/under applied?
6. How much are the costs of goods manufactured?

Group of answer choices

The cost of goods manufactured is $40,000

The amount of sales revenue earned was $50,000

The amount of over/under applied MOH is $0

The predetermined MOH rate is $1.25

The amount of sales revenue earned was $50,700

The direct labor that will be debited to direct labor expense is $160,137

The direct labor that will be debited to direct labor expense is $40,960

The predetermined MOH rate is $.80

The amount of over/under applied MOH is $960

The direct labor that will be debited to direct labor expense is $0

The cost of goods manufactured is $50,000

The total current manufacturing costs are $137,160

The direct labor that will be debited to direct labor expense is $160,200

The cost of goods manufactured is $39,000

The direct labor that will be debited to direct labor expense is $51,200

The predetermined MOH rate is $..75

The amount of over/under applied MOH is $1,000

The amount of sales revenue earned was $39,000