Hanover Products manufactures screws and bolts made to customer specifications. During August, they incurred the following manufacturing costs: ? Direct materials $28,019 ? Direct labor $15,276.75 ? Applied factory overhead $9,854.50 The following data pertain to these costs: Summary of Direct Materials Requisitions

Summary of Direct Labor Time Tickets

The overhead application rate is $4 per direct labor hour for Dept 1 and 175% of direct labor cost for Dept 2. The company had no beginning work in process for August, Job 8958, which cost $14,190.18 to manufacture, was completed in July and was sold on account in August for $19,000. The job cost sheet for this job is shown on below. Of the jobs begun in August, Job 8961 was completed and sold on account for $24,000,

ACG2071 - 2185

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Job 8962 and 8964 was completed but not sold and Job 8963 was still in process.

The Board of Directors of Sanderson Inc. and Gill Corp. reached an agreement in principle to merge the two companies and create a new company called SG Ltd.The basics of the agreement confirmed so far are outlined below: The new company will purchase all of the assets and assume all of the liabilities of Sanderson and Gill by issuing shares. After the sale the two companies will be wound up. Some but not all members of the top management of each company will be retained. The number of SG shares that will be issued has not yet been determined. The founding shareholders of Sanderson Corp., who owned 60% of the voting shares of Sanderson prior to the merger, have rights to veto any sale of patents, which they developed and registered. Some of the other shareholders of Sanderson also owned non-voting preferred shares of Sanderson. These preferred shares were convertible into common shares of Sanderson on a one-for-one basis. Required: Make an initial post to provide the chair of the merger committee with no more than two pieces of advice as to the accounting implications that will result from this merger, even though many of the details have not yet been ironed out.

Step 1:

You work for Thunderduck Custom Tables Inc. This is the first month of operations. The company designs and manufactures specialty tables. Each table is specially customized for the customer. This month, you have been asked to develop and manufacture two new tables for customers. You will design and build the tables. This is a no nail, no screw, and no glue manufacturing ( no indirect materials used). You will be keeping track of the costs incurred to manufacture the tables using Job #1 Cost Sheet and Job #2 Cost Sheet.

The cost of the direct materials that can be used to manufacture the table are as follows. These cost are on a per unit basis.

  Table Top $1,800.00

  Table Leg   $550.00

  Drawer   $380.00

The company uses a job order costing system and applies manufacturing overhead to jobs based on direct labor hours.   

The company estimates that there will be 12 direct labor hours worked during the month.

The estimated manufacturing overhead cost for the month is:  

a.Factory supervisor salary per month $4,000.00

b.Rent for the factory per month $1,400.00

c.Depreciation of factory equipment per month $600.00

  Total Estimated manufacturing overhead $6,000.00

What is the predetermined manufacturing overhead rate?   

Step 2:

The first order you received was to manufacture a table using a table top and four legs. This is your Job #1.

Step 3:

The customer that has ordered Job #2, wants a table that is the same as Job #1, but wants to also add a drawer to the table.

Step 4:

The following is a list of transactions that need to be recorded for the company for activity in the month of December. Record those in the "General Journal" tab of the excel file using the proper format. Please use the following accounts: Accounts Receivables, Raw materials, Work in process, Finished goods, Accumulated depreciation, Accounts payable, Salaries and wages payable, Sales revenue, Manufacturing overhead, Cost of goods sold, Salaries and wages expense, Advertising expenses, and Depreciation expense.

1-Dec Raw Materials purchased on account, $18,000.

5-Dec All Raw Materials needed for Job #1 were requisitioned from the material storage for use during the month. Assume all materials are direct. (After you journalize this entry please enter the information into Job #1 Cost Sheet)

10-Dec The following employee costs were incurred but not paid during the month:

There are three assembly employees that spend 2 hours each, $20 per hour to make the table for Job #1. (After you journalize this entry please enter the information into Job #1 Cost Sheet)

Salary for supervisor of the factory $4,500.

Administrative Salary $2,000.

15-Dec All Raw Materials needed for Job #2 were requisitioned from the material storage for use during the month. Assume all materials are direct. (After you journalize this entry please enter the information into Job #2 Cost Sheet)

16-Dec Rent for the month of December for the factory building incurred but not paid $1,400.

17-Dec Advertising costs incurred but not paid for the month was $1,600.

20-Dec Depreciation for the month of December was recorded on equipment was $750 ($150 for equipment used in the factory and the remainder for equipment used in selling and administrative activities).

22-Dec Manufacturing overhead cost was applied based on direct labor hours to Job #1 based on the POHR determined on the "Job Cost Sheet". (After you journalize this entry please enter the information into Job #1 Cost Sheet)

26-Dec Job #1 was completed and transferred to Finished Goods during the month.

28-Dec The completed table from Job #1 was sold on account to the customer for $23,000 during the month. (Hint: Make sure to account for the cost of the table that was sold using the cost from the job cost sheet.)

31-Dec Direct labor cost incurred but not paid for three employees to start manufacturing Job #2. The employees only worked one hour each, three hours total, $20 per hour during the month and they did not complete their work on the job. (After you journalize this entry please enter the information into Job #2 Cost Sheet)

31-Dec Manufacturing overhead cost was applied based on direct labor hours to Job #2 based on the POHR. Only three direct labor hours were worked on Job #2 during the month. (After you journalize this entry please enter the information into Job #2 Cost Sheet)

31-Dec Any underapplied or overapplied overhead for the month was closed out to Cost of Goods Sold.

Price, Variable Cost per Unit, Contribution Margin, Contribution Margin Ratio, Fixed Expense

For each of the following independent situations, calculate the amount(s) required.

Required:

1. At the break-even point, Jefferson Company sells 85,000 units and has fixed cost of $349,900. The variable cost per unit is $0.20. What price does Jefferson charge per unit? Round to the nearest cent.
$

2. Sooner Industries charges a price of $93 and has fixed cost of $481,500. Next year, Sooner expects to sell 19,300 units and make operating income of $175,000. What is the variable cost per unit? What is the contribution margin ratio? Round your variable cost per unit answer to the nearest cent. Enter the contribution margin ratio as a percentage, rounded to two decimal places.

3. Last year, Jasper Company earned operating income of $28,920 with a contribution margin ratio of 0.3. Actual revenue was $241,000. Calculate the total fixed cost. Round your answer to the nearest dollar, if required.
$

4. Laramie Company has variable cost ratio of 0.55. The fixed cost is $102,650 and 21,900 units are sold at breakeven. What is the price? What is the variable cost per unit? The contribution margin per unit? (Round answers to the nearest cent.)

You have just been hired as a new management trainee by Earrings Unlimited, a distributor of earrings to various retail outlets located in shopping malls across the country. In the past, the company has done very little in the way of budgeting and at certain times of the year has experienced a shortage of cash. Since you are well trained in budgeting, you have decided to prepare a master budget for the upcoming second quarter. To this end, you have worked with accounting and other areas to gather the information assembled below.

The company sells many styles of earrings, but all are sold for the same price—$14 per pair. Actual sales of earrings for the last three months and budgeted sales for the next six months follow (in pairs of earrings):

January (actual) $21,600   June (budget) $51,600

February (actual)  $27,600   July (budget) $31,600

March (actual) $41,600   August (budget) $29,600

April (budget) $66,600   September (budget) $26,600

May (budget) $101,600                            

The concentration of sales before and during May is due to Mother’s Day. Sufficient inventory should be on hand at the end of each month to supply 40% of the earrings sold in the following month.

Suppliers are paid $4.80 for a pair of earrings. One-half of a month’s purchases is paid for in the month of purchase; the other half is paid for in the following month. All sales are on credit. Only 20% of a month’s sales are collected in the month of sale. An additional 70% is collected in the following month, and the remaining 10% is collected in the second month following sale. Bad debts have been negligible.

Monthly operating expenses for the company are given below:

Variable:                                          

Sales commissions                         4% of sales

Fixed:                                

Advertising   $280,000              

Rent $26,000  

Salaries $122,000              

Utilities $11,000  

Insurance $3,800    

Depreciation $22,000  

Insurance is paid on an annual basis, in November of each year.

The company plans to purchase $20,000 in new equipment during May and $48,000 in new equipment during June; both purchases will be for cash. The company declares dividends of $21,000 each quarter, payable in the first month of the following quarter.

The company’s balance sheet as of March 31 is given below:

Assets

Cash      $             82,000

Accounts receivable ($38,640 February sales; $465,920 March sales)                      504,560

Inventory                           127,872

Prepaid insurance                          25,000

Property and equipment (net)                   1,030,000

Total assets        $             1,769,432

Liabilities and Stockholders’ Equity

Accounts payable             $             108,000

Dividends payable                         21,000

Common stock               960,000

Retained earnings                          680,432

Total liabilities and stockholders’ equity $             1,769,432

The company maintains a minimum cash balance of $58,000. All borrowing is done at the beginning of a month; any repayments are made at the end of a month.

The company has an agreement with a bank that allows the company to borrow in increments of $1,000 at the beginning of each month. The interest rate on these loans is 1% per month and for simplicity we will assume that interest is not compounded. At the end of the quarter, the company would pay the bank all of the accumulated interest on the loan and as much of the loan as possible (in increments of $1,000), while still retaining at least $58,000 in cash.

Required:

Prepare a master budget for the three-month period ending June 30. Include the following detailed schedules:

1. a. A sales budget, by month and in total.

    b. A schedule of expected cash collections, by month and in total.

    c. A merchandise purchases budget in units and in dollars. Show the budget by month and in total.

    d. A schedule of expected cash disbursements for merchandise purchases, by month and in total.

2. A cash budget. Show the budget by month and in total. Determine any borrowing that would be needed to maintain the minimum cash balance of $58,000.

3. A budgeted income statement for the three-month period ending June 30. Use the contribution approach.

4. A budgeted balance sheet as of June 30.

Replacement Analysis

The Gilbert Instrument Corporation is considering replacing the wood steamer it currently uses to shape guitar sides. The steamer has 6 years of remaining life. If kept, the steamer will have depreciation expenses of $300 for 6 years. Its current book value is $1,800, and it can be sold on an Internet auction site for $4,500 at this time. Thus, the annual depreciation expense is $1,800/6=$300 per year. If the old steamer is not replaced, it can be sold for $800 at the end of its useful life.

Gilbert is considering purchasing the Side Steamer 3000, a higher-end steamer, which costs $7,900, and has an estimated useful life of 6 years with an estimated salvage value of $900. This steamer falls into the MACRS 5-years class, so the applicable depreciation rates are 20.00%, 32.00%, 19.20%, 11.52%, 11.52%, and 5.76%. The new steamer is faster and allows for an output expansion, so sales would rise by $2,000 per year; the new machine's much greater efficiency would reduce operating expenses by $1,600 per year. To support the greater sales, the new machine would require that inventories increase by $2,900, but accounts payable would simultaneously increase by $700. Gilbert's marginal federal-plus-state tax rate is 40%, and the project cost of capital is 14%. Should it replace the old steamer?

The old steamer _________________ be replaced.

What is the NPV of the project? Do not round intermediate calculations. Round your answer to the nearest dollar.
$ ________

What information do users of accounting reports need?

In its first year of operations, 20X2,ABC Companyy., had credit sales of $420,000 to many different customers. Of this amount, Cindy Mol purchased $400 and J. Jocke purchased $180 on account. During the year, cash collections of $389,000 were made, of which Cindy Mol paid $360 and J. Jocke paid $60. At the end of 20X2, bad debts expense was estimated to be 5% of ending accounts receivable. At December 31, 20X2, the Allowance for Uncollectible Accounts is $0. On February 23, 20X3, the balance in J. Jocke's account was written off as uncollectible.

Prepare the appropriate journal entry on the books of ABC Company for

a. the $420,000 in credit sales.

b. the collection of $389,000 from credit customers.

c. the estimation of bad debts expense.

d. the write-off of J. Jocke's account.

A company's income statement showed the following: net income, $127,000; depreciation expense, $36,500; and gain on sale of plant assets, $10,500. An examination of the company's current assets and current liabilities showed the following changes as a result of operating activities: accounts receivable decreased $10,700; merchandise inventory increased $24,500; prepaid expenses increased $7,500; accounts payable increased $4,700. Calculate the net cash provided or used by operating activities.

Multiple Choice

• $177,400.

• $156,200.

• $149,400.

• $151,400.

Fill in the remaining entries in the following table using the formulas for the expected return and the variance of a portfolio below. Please show your detailed calculations or provide arguments to support your answers. I will not be able to give you full credit even if your answer is correct.

Financial statements for Perez Company follow.

Required

Calculate the following ratios for 2019 and 2018. Since 2017 numbers are not presented do not use averages when calculating the ratios for 2018. Instead, use the number presented on the 2018 balance sheet.

1. Working capital.
2. Current ratio. (Round your answers to 2 decimal places.)
3. Quick ratio. (Round your answers to 2 decimal places.)
4. Receivables turnover (beginning receivables at January 1, 2018, were $45,000). (Round your answers to 2 decimal places.)
5. Average days to collect accounts receivable. (Round your intermediate calculations to 2 decimal places and your final answers to the nearest whole number.)
6. Inventory turnover (beginning inventory at January 1, 2018, was $151,000). (Round your answers to 2 decimal places.)
7. Number of days to sell inventory. (Round your intermediate calculations to 2 decimal places and your final answers to the nearest whole number.)
8. Debt to assets ratio. (Round your answers to the nearest whole percent.)
9. Debt to equity ratio. (Round your answers to 2 decimal places.)
10. Number of times interest was earned. (Round your answers to 2 decimal places.)
11. Plant assets to long-term debt. (Round your answers to 2 decimal places.)
12. Net margin. (Round your answers to 2 decimal places.)
13. Turnover of assets. (Round your answers to 2 decimal places.)
14. Return on investment. (Round your answers to 2 decimal places.)
15. Return on equity. (Round your answers to 2 decimal places.)
16. Earnings per share. (Round your answers to 2 decimal places.)
17. Book value per share of common stock. (Round your answers to 2 decimal places.)
18. Price-earnings ratio (market price per share: 2018, $12.30; 2019, $13.60). (Round your intermediate calculations and final answer to 2 decimal places.)
19. Dividend yield on common stock. (Round your answers to 2 decimal places.)

Assume you have bought a property worth 210,000 $ with a downpayment of $10,000 and Interest rate = 5%, Total number of installments to be made =24, monthly interest rate = 5%/12

How do we calculate all of these payment step by step ?

Mortgage Balance,   Monthly Payment,    Interest Payment, Principal Payment,     Ending Mortgage Balance

As mentioned in the opening part of the Robatelli's Pizzeria case, there are now 53 locations throughout the greater Pittsburgh area. Each one of those restaurant locations employs a full-time store manager and varying numbers of kitchen staff, servers, and delivery staff. The kitchen staff, servers, and delivery staff vary between full-time and part-time status. There tend to be high rates of turnover, especially among the part-time staff. Robatelli's pays its employees on a weekly basis each Friday for the week ending on the previous Saturday. Employee paychecks include withholdings for federal taxes as well as state and local taxes applicable for the employee's residence. Employees may live in one of three states and over 25 municipalities that are included in the greater Pittsburgh regional area. All payroll accounting is handled by Robatelli's at its home office.

Each restaurant must also maintain various fixed assets in order to operate.Following is a general list of fixed assets for each store:

 Furniture and store fixtures, including tables, chairs, and built-in items such as shelving, counters, and booths

 Kitchen equipments, such as refrigerators, stoves, ovens, and dishwashing machines

 Computers Note that the number of each of these fixed assets maintained at each location varies, depending upon the size of the store. Also note that each member of the delivery staff uses his or her personal automobile (rather than a company-owned car) for customer deliveries.

In addition, the home office maintains the following types of fixed assets:

 Land and the office building

 Office furniture and fixtures

 Computers and other office equipment

 Telephone systems

Finally, fixed assets maintained at the commissary include the following:

 Fixtures, such as built-in cabinets and shelving

 Kitchen equipment

 Computers

 Delivery trucks

All fixed asset accounting is handled by Robatelli's at its home office.

Required:

a. Describe how you believe an efficient and effective payroll system should be organized at Robatelli's. Include details such as the answers to these questions:

(a) What types of payroll documentation should be prepared at the restaurant locations?

(b) How will the necessary information for payroll flow between restaurants and the home office?

(c) How should IT systems be used in the payroll processes?

The Alternative Minimum Tax (AMT) was designed so that high-income taxpayers could avoid using tax loopholes to pay little to no income tax. AMT has not been adjusted for inflation so an increased number of middle-class taxpayersare having to pay AMT. What are your thoughts on AMT - should AMT be eliminated, is it necessary, should reform occur??? Please discuss your thoughts.

Sturdy has an opportunity to purchase frames for $115 each.

Additional Information

1. The manufacturing equipment, which originally cost $570,000, has a book value of $420,000, a remaining useful life of five years, and a zero salvage value. If the equipment is not used to produce bicycle frames, it can be leased for $73,000 per year.

2. Sturdy has the opportunity to purchase for $960,000 new manufacturing equipment that will have an expected useful life of five years and a salvage value of $77,500. This equipment will increase productivity substantially, reducing unit-level labor costs by 60 percent. Assume that Sturdy will continue to produce and sell 23,000 frames per year in the future.

3. If Sturdy outsources the frames, the company can eliminate 70 percent of the inventory holding costs.

Required

1. Determine the avoidable cost per unit of making the bike frames, assuming that Sturdy is considering the alternatives of making the product using the existing equipment or outsourcing the product to the independent contractor. Based on the quantitative data, should Sturdy outsource the bike frames?

2. Assuming that Sturdy is considering whether to replace the old equipment with the new equipment, determine the avoidable cost per unit to produce the bike frames using the new equipment and the avoidable cost per unit to produce the bike frames using the old equipment. Calculate the increase or decrease in the company's profit if the company uses new equipment.

3. Assuming that Sturdy is considering whether to either purchase the new equipment or outsource the bike frame, calculate.