Required information

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

During April, the first production department of a process manufacturing system completed its work on 315,000 units of a product and transferred them to the next department. Of these transferred units, 63,000 were in process in the production department at the beginning of April and 252,000 were started and completed in April. April's beginning inventory units were 75% complete with respect to materials and 25% complete with respect to conversion. At the end of April, 85,000 additional units were in process in the production department and were 80% complete with respect to materials and 30% complete with respect to conversion.

The production department had $825,945 of direct materials and $707,955 of conversion costs charged to it during April. Also, its April beginning inventory of $155,675 consists of $131,555 of direct materials cost and $24,120 of conversion costs.

1. Compute the direct materials cost per equivalent unit for April. (Round "Cost per EUP" to 2 decimal places.)
2. Compute the conversion cost per equivalent unit for April. (Round "Cost per EUP" to 2 decimal places.)
3. Using the weighted-average method, assign April’s costs to the department’s output—specifically, its units transferred to the next department and its ending work in process inventory. (Round "Cost per EUP" to 2 decimal places.)

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 95,000 pounds with $155,800 in materials cost and $117,800 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, 282,000 pounds were started into production. The May 31 inventory consisted of 127,000 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.

QUESTION 2 20 MARKS
William and Paul own a business selling face masks and hand sanitiser. They agreed that
profits will be spilt 80% to William and 20% to Paul and that losses will be split 50% to each of
them. They also agreed that before any profits or losses are split Paul gets a salary and William
gets interest on his capital contributions. Paul gets a salary because he spends most of his time
in the shop dealing with customers. William only provided capital to the business. William also
made an arm’s length loan to the business.
The partners provide you with the following information for the year ended 30 June 2019:
Sales of trading stock for the business $330,000
Interest paid to William (Capital Contribution) $13,000
Salary to Staff of the business $75,000
Purchase of trading stock for the business $200,000
Opening Stock on 1 July 2018 $37,000
Closing Stock on 30 June 2019 $23,000
Interest paid to William (Loan) $5,000
Superannuation for Paul $9,000
Superannuation for Staff of the business $6,000
Required:
Calculate the partnership distribution for each partner for the year ended 30 June 2019.
You must give reasons for your answer. Your discussion must include an analysis of the pertinent
sections of the relevant legislation, rulings, and the relevant case law. If relevant, you must show
your calculation. You must apply the law to the facts and provide YOUR OWN analysis of the
issues and write a comprehensive answer to the question.
[Answer

What proportion of the world's car structure is in meters?

Lehighton Chalk Company manufactures sidewalk chalk, which it sells online by the box at $22 per unit. Lehighton uses an actual costing system, which means that the actual costs of direct material, direct labor, and manufacturing overhead are entered into work-in-process inventory. The actual application rate for manufacturing overhead is computed each year; actual manufacturing overhead is divided by actual production (in units) to compute the application rate. Information for Lehighton’s first two years of operation is as follows:

Selected information from Lehighton’s year-end balance sheets for its first two years of operation is as follows:

1. Prepare operating income statements for both years based on absorption costing.

2. Prepare operating income statements for both years based on variable costing.

3. Prepare a numerical reconciliation of the difference in income reported under the two costing methods used in requirements (1) and (2).

PRI has a 40 percent interest in NCE, a joint venture. During Year 5, NCE reported net income of $100,000 and paid a dividend of $60,000. NCE’s inventory includes goods purchased from PRI on which PRI had made a profit of $10,000. What amount of income should PRI report on its investment in NCE for Year 5 under the equity method? (Ignore income taxes.)

A. $24,000

B. $30,000

C. $36,000

D. $40,000

If revising depreciation, how is it calculated?

Please answer all parts, thank you, and please type your answer and show all work including excel formulas

Exercise 15-15

The following data were taken from the balance sheet accounts of Shamrock Corporation on December 31, 2016.

Prepare the required journal entries for the following unrelated items. (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.)

On January 1, 2016, Parkway adopted a defined benefit pension plan, with retroactive benefits. Prior service cost of $2,180,000, amortized straight-lined over 16 years.

Service Cost 340,000 348,000
Projected benefit obligation (1/1) 2,180,000 2,738,000
Plan assets (1/1) 0 670,000
Discount rate 10% 10%   
Expected/actual long-term rate of return 0% 9%
Contributions 670,000 700,000
Projected benefit obligation (end of 2017)     3,359,800
Fair value of plan assets 1,430,300

1. Compute the amount of Parkway’s pension expense for 2016 and 2017.
2. Prepare all the journal entries related to Parkway’s pension plan for 2016 and 2017.
3. What is the total accrued/prepaid pension cost at the end of 2017? Is it an asset or a liability?

The possibility of a power outage seems to grow every year because of demand and an aging infrastructure. What can/should companies do to mitigate this risk?

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 $3,825,000 per year, but that would be more than offset by the $5,100,000 (20% × $25,500,000) that we would avoid on agents’ commissions.”

The breakdown of the $3,825,000 cost follows:

“Super,” replied Karl. “And I noticed that the $3,825,000 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 $117,300 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.

Preparing Entries Across Two Periods
The following selected accounts appear in Zimmerman Company's unadjusted trial balance at December 31, 2015, the end of its fiscal year (all accounts have normal balances).

Additional information is as follows.
1. On September 1, 2015, the company entered into a prepaid equipment maintenance contract. Zimmerman Company paid $2,700 to cover maintenance service for 6 months, beginning September 1, 2015. The $2,700 payment was debited to Prepaid Maintenance.
2. Supplies available on December 31 are $3,200.
3. Unearned commission fees at December 31 are $4,000.
4. Commission fees earned but not yet billed at December 31 are $2,800. (Hint: Debit Fees Receivable.)
5. Zimmerman Company's lease calls for rent of $900 per month payable on the first of each month, plus an annual amount equal to 1% of annual commissions earned. This additional rent is payable on January 10 of the following year. (Hint: Use the adjusted amount of commissions earned in computing the additional rent.)

Required

(a) Prepare Zimmerman Company's adjusting entries at December 31, 2015 using the financial statement effects template.

(b) Prepare entries on January 10, 2016, using both the financial statement effects template and in journal entry form, to record (1) the billing of $4,600 in commissions earned (which includes the $2,800 of commissions earned but not billed at December 31) and (2) the cash payment of the additional rent owed for 2015. (Hint for part (1): Zimmerman Company has two receivable accounts-- Fees Receivable is used for amounts earned, but not yet billed, and Accounts Receivable for amounts that are earned and billed to the customer.)

For the Noncash Assets answer, enter the net amount for the transaction.

Builder Products, Inc., uses the weighted-average method in its process costing system. It manufactures a caulking compound that goes through three processing stages prior to completion. Information on work in the first department, Cooking, is given below for May:

Required:

1. Compute the equivalent units of production for materials and conversion for May.

2. Compute the cost per equivalent unit for materials and conversion for May.

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

4. Compute the cost of units transferred out to the next department for materials, conversion, and in total for May.

5. Prepare a cost reconciliation report for May.

10. Michelle Wightman was driving toward a railroad crossing at which the gates were down and the lights flashing. Wightman noted a stopped train a short distance from the gate. Believing the stopped train to be the cause of the closed gate, she drove around the gate and was struck and killed by a train that suddenly appeared from behind the stopped train. The stopped train had blocked her view of the oncoming train. Both trains were owned and operated by Consolidated Rail Corporation (CRC). Wightman's mother brought a wrongful death lawsuit and a survivorship action against CRC. In response, CRC claimed that Wightman's action of driving around the gates, in violation of both state and city law regarding the operation of a motor vehicle at a railroad crossing, constituted negligence on her part. Furthermore, CRC argued that if Wightman had not crossed the tracks, she would not have been struck by the train. Therefore, her actions were the sole cause of the accident, and the railroad corporation should not be held liable for her death. The attorney for the plaintiff argued that the placement of the first train, blocking the view of the other track, contributed to the accident and that CRC should be held liable for Wightman's death. Should Wightman's own negligence be a complete bar to the plaintiff's recovery of damages in this case? Explain. [See: Wightman v. Consolidated Railroad Corporation, 640 N.E.2d 1160 (OH).]

Traditional budgeting methods are becoming outdated and counter-productive. The idea that departments will needlessly spend in the final months of the year to ensure their budget is not cut the following is unreasonable. Beyond Budgeting looks to rectify these problems by abandoning traditional methods. The two main drivers for this are;

1.A more adaptive set of management processes

2.A highly decentralized organization

Beyond Budgeting empowers management by giving them the freedom to achieve their goals without the need of a rigid set of budgeted number's? Instead, front line management are given goals that are in line with shareholder value and the bigger picture.

As one of the main criticisms of traditional budgeting methods is the fact it's too short-term in its thinking. These goals are measured using a set of KPI's, industry benchmarks, customer satisfaction and revenue or market capitalization.

Hope and Fraser identified 6 shared common principles that should be used by all companies who want to adopt a Beyond Budgeting technique:

.A governance framework based on clear priorities and boundaries.

.A high performance climate based on visible and relative success at all levels.

.Front line teams with a freedom to take decisions in line with the company's governance principles and strategic goals.

.Teams given responsibility for value creating systems.

.Teams focuses on customer outcomes.

.Open and ethical information systems.

If applied correctly, the beyond budgeting process rewards the high performers within the company and not just the skilled budget negotiators. Other key benefits include accountability and ownership by empowering the front line teams to make decisions. And, of course, there is less waste as managers are encouraged to work towards medium and long term strategic goals rather than traditional annual budgets that produce unnecessary spend.

REQUIRED:

1.Debate the impact of Beyond Budgeting, clearly providing relevant examples and cases to enhance your discussion. It should include an analysis of its technical

implementation and overall impact towards the firm's business model and strategy.

2.Determine the behavioral changes expected from the firm's personnel in line with the changes explained in Question 1.