Question 3 You are the accountant for FreeWheels Ltd, a tandem bicycle manufacturer that is located in Coffs Harbour and has customers in Australia and the USA. Their estimated current sales volume is 6,000 units per month and based on this level of production, the company has budgeted the following costs and prices per unit: Manufacturing Costs per unit (Based on production of 6,000 units per month) Direct Material Cost $75.00 Direct Labour Cost 35.00 Variable Factory Overhead 10.00 Fixed Factory Overhead 20.00 Total Manufacturing Cost 140.00 Selling & Administrative Costs Variable Selling and Administrative Cost 25.00 Fixed Selling and Administrative Cost 20.00 45.00 Total Cost Per Unit 185.00 Selling Price Per Unit $370.00 Cycle World Ltd is an overseas company that sells bicycles all over the world, with the majority of their market in China and India. They have approached FreeWheels about obtaining a quote for a special one-off order as they would like to purchase 25,000 bikes. As this will be a special order sale, there will be no costs incurred for variable selling and administrative costs and no additional fixed costs will be incurred. This order is because their existing supplier has suffered substantial earthquake damage to their premises, but the CEO of Cycle World Ltd also hinted to your CEO that if they are satisfied with the product, this might not be the last deal between the two businesses. Required: 1. Given this knowledge, what amount should FreeWheels Ltd. bid for this contract in each of the following circumstances: a) The FreeWheels’s annual factory capacity is 100,000 units. b) The FreeWheels’s annual factory capacity is 90,000 units. (To fulfil the order, you may have to pull the product from your regular production). 2. Assuming that the annual factory capacity is 100,000 units, prepare a report for your CEO explaining your justification for the bid price that you came up with in 1 a). Discuss the possible opportunities and potential disadvantages with accepting this contract with Cycle World. Give both quantitative and qualitative support to your discussion.

3. Nacho Company is a retailer of durable, light-weight backpack bag and consistently known for their high-quality and innovation. The firm is considering dropping the Pink backpack product and only to sell the traveler backpack. Nacho Company allocates fixed costs (both corporate and selling/administrative) to products based on sales revenue. When the president of the company saw the product-line income statements (presented below), he agreed that the Pink product should be dropped. If this is done, sales of traveller are expected to increase by 20% next year; the firm's cost structure will remain the same.

Required:

1. Find the expected change in annual operating income by dropping the Pink product and selling only the traveler product. Show calculations to support your answer.

2. What strategic factors should be considered?

What is the difference between current earnings and profits and accumulated earnings and profits?

I need an adjusted trial balance for this question. Here are the instructions, the journal, and the unadjusted trial balance.

Palisade Creek Co. is a merchandising business that uses the perpetual inventory system. The account balances for Palisade Creek Co. as of May 1, 2019 (unless otherwise indicated), are as follows:

During May, the last month of the fiscal year, the following transactions were completed:

Record the following transactions on page 20 of the journal. Refer to the Chart of Accounts for exact wording of account titles.

Record the following transactions on page 21 of the journal. Refer to the Chart of Accounts for exact wording of account titles.

Create an adjusting trail balance.

When is the unrelated business tax assessed on an exempt organization

Benjamin Company had the following results of operations for the past year:

A foreign company (whose sales will not affect Benjamin’s market) offers to buy 2,825 units at $15.20 per unit. In addition to variable manufacturing costs, selling these units would increase fixed overhead by $960 and selling and administrative costs by $780. Assuming Benjamin’s productive capacity is 11,300 units per year and accepts the offer, its profits will:

• Decrease by $10,735.

• Decrease by $12,475.

• Decrease by $ 122,605.

• Increase by $ 8,995.

• Increase by $ 3,605.

1. On June 3, a company sells merchandise with price of $2,000 (Terms: 2/10, net 60. Instructions: Prepare all the seller’s journal entries related to this sale and customer payments for both the Gross and Net methods under the following three mutually exclusive cases.

Case 1: Customer settles entire receivable on June 12

Case 2: Customer settles entire receivable on July 29

Case 3: Customer settles ½ of receivable on June 12 and ½ of receivable on July 29

Budgeting is an essential activity organization. managers should relate budgeting with the company's vision, mission, strategy and long term and prepare a budget as a form of refined annual plan that detailed the firms route towards achieving the projected annual performance. Debat the above statement.

On 1 January 2018, Bae Limited issued a convertible bond with a par value of $100,000 for $120,000.

1. The bonds are convertible into 12,000 ordinary shares of Jan.

2. The bond has a 5-year life with a stated interest of 10% per annum. Interest

   payment is made each year on 31 December, starting from 31 December 2018.

3. The market interest rate on 1 January 2018 for a similar non-convertible bond is

   8% per annum.

4. On 1 January 2018, the liability component of the bond is computed to be $107,986.

5. On 31 December 2019, after the interest has been recorded, Jan Limited

   repurchases the bond for $111,000 cash. At that time the fair value of the liability component is $108,000.

Date

  Cash paid. Interest expense.   Premium amortised   Carrying amount of liability

1 January 2018. $107,986
31 December 2018 $10,000 $8,639 $1,361 $106,625

31 December 2019.   $10,000.   $8,530   $1,470   $105,155

1.Prepare the journal entry to record the issuance of the convertible bond on 1 January 2018.

2. Calculate the loss on repurchase for the liability component of the bond on 31 December 2019.

3. Calculate the adjustment on the equity component of the bond on 31 December 2019.

4. Prepare the journal entries to record the repurchase of bonds on 31 December 2019.

Can Costing Accounting works be taken over by the book keeper in the accounting record process? is Cost Accounting works indispensable in a manufacturing concern. Debate the above statement

Why might ethical corporate behavior actually lead to higher profitability (and not the opposite)?

1. Sleet Company has proposed a bond offering of $5,000,000 at a contract rate of interest of 6% and interest payments to be paid semi-annually. The question is if the market rate is 10% then what would be the cash proceeds for this 12-year bond assuming all bonds were sold at auction?

2. Another question is what would be the amount of interest charged to Sleet Company during the first year the bonds were outstanding?

3. What is the total amount of interest paid during the entire life of the bonds?

EMD Corporation manufactures two products, Product S and Product W. Product W is of fairly recent origin, having been developed as an attempt to enter a market closely related to that of Product W. Product W is the more complex of the two products, requiring 3 hours of direct labor time per unit to manufacture compared to 2 hour of direct labor time for Product S. Product W is produced on an automated production line.

Overhead is currently assigned to the products on the basis of direct-labor-hours. The company estimated it would incur $1,072,715 in manufacturing overhead costs and produce 15,000 units of Product W and 75,000 units of Product S during the current year. Unit cost for materials and direct labor are:

Required:

a-1. Compute the predetermined overhead rate under the current method of allocation.

a-2. Determine the unit product cost of each product for the current year.

b. The company's overhead costs can be attributed to four major activities. These activities and the amount of overhead cost attributable to each for the current year are given below:

Using the data above and an activity-based costing approach, determine the unit product cost of each product for the current year.

predetermined overhead rate?

Determine the unit product cost of each product for the current year. (Round your answers to 2 decimal places.)

S?

W?

Using the data above and an activity-based costing approach, determine the unit product cost of each product for the current year.

S?

W?

Camp Rainbow offers overnight summer camp programs for children ages 10–14 every summer during June and July. Each camp session is one week and can accommodate up to 200 children. The camp is not coed, so boys attend during the odd-numbered weeks and girls attend during the even-numbered weeks. While at the camp, participants make crafts, participate in various sports, help care for the camp’s resident animals, have cookouts and hayrides, and help assemble toys for local underprivileged children.

The camp provides all food as well as materials for all craft classes and the toys to be assembled. One cabin can accommodate up to 10 children, and one camp counselor is assigned to each cabin. Three camp managers are on-site regardless of the number of campers enrolled.

Following is the cost information for Camp Rainbow’s operations last summer:

Required:
1. Perform a least-squares regression analysis on Camp Rainbow’s data. (Use Microsoft Excel or a statistical package to find the coefficients using least-squares regression. Round your answers to 2 decimal places.)

2. Using the regression output, create a cost equation (y = a + bx ) for estimating Camp Rainbow’s operating costs.

3. Using the least-squares regression results, calculate the camp’s expected operating cost if 125 children attend a session. (Round your intermediate calculations and final answer to 2 decimal places.)