Part a VenRam Stationery & Supplies sells a variety of school supplies including a variety of calculators. The business began the first quarter (January to March) of 2018 with 20 (Casio fx-85MS) calculators at a total cost of $124,800. During the quarter, the company completed the following transactions. January 8 105 calculators were purchased at a cost of $5,840 each. In addition the business paid a freight charge of $610 cash on each calculator to have the inventory shipped from the point of purchase to their warehouse. January 31 The sales for January were 85 calculators which yielded total sales revenue of $767,550. ( 25 of these units were sold on account to longstanding customers) February 4 A new batch of 65 calculators was purchased at a total cost of $448,500 February 10 10 of the instruments purchased on February 4 were returned to the supplier, as they were not of the model ordered. February 28 During the month 58 calculators were sold at a price of $9,660 each. March 4 A customer, to whom 9 calculators were sold during the first business day of February, returned 2 of the instruments, as they were of another brand. March 10 Owing to an increased demand, a further 118 calculators were purchased at a cost of $7,500 each; these were subject to a trade discount of 2% each. March 31 125 calculators were sold during March at a unit selling price of $10,300. March 31 An actual count of inventory was carried out which revealed that there were 28 units of that brand of merchandise in the store room. Unless otherwise stated, assume that all purchases were on account and received on the dates stated. Required: i) Prepare a perpetual inventory record for this merchandise, using the first in, first out (FIFO) method of inventory valuation to determine the company’s cost of goods sold for the quarter and the value of ending. ii) Given that selling, distribution and administrative costs for the quarter were $112,840, $102,100 and $103,760 respectively, prepare an income statement for VenRam Stationery & Supplies for the quarter ended March 31, 2018. iii) Journalize the January transactions, assuming the company uses a: - Periodic inventory system - Perpetual inventory system iv) The manager of VenRam has stated that his objective is to cut back on his tax liability and is of the view that the FIFO method would be best. Do you agree with him? Part b Callahan Computers stores its inventory in a warehouse that was destroyed by Hurricane Irma in September 2018. The business began the year with inventory of $350,000. During the year, the business made net purchases of $1,600,000 and had net sales of $2,500,000. The company’s gross profit has historically been 30% of net sales revenue. Use the gross profit method to estimate the cost of the ending inventory destroyed in the hurricane.

Can you answer part (iii) of this question.

Thank you.

Part a VenRam Stationery & Supplies sells a variety of school supplies including a variety of calculators. The business began the first quarter (January to March) of 2018 with 20 (Casio fx-85MS) calculators at a total cost of $124,800.

During the quarter, the company completed the following transactions. January 8 105 calculators were purchased at a cost of $5,840 each. In addition the business paid a freight charge of $610 cash on each calculator to have the inventory shipped from the point of purchase to their warehouse.

January 31 The sales for January were 85 calculators which yielded total sales revenue of $767,550. ( 25 of these units were sold on account to longstanding customers)

February 4 A new batch of 65 calculators was purchased at a total cost of $448,500

February 10 10 of the instruments purchased on February 4 were returned to the supplier, as they were not of the model ordered.

February 28 During the month 58 calculators were sold at a price of $9,660 each.

March 4 A customer, to whom 9 calculators were sold during the first business day of February, returned 2 of the instruments, as they were of another brand.

March 10 Owing to an increased demand, a further 118 calculators were purchased at a cost of $7,500 each; these were subject to a trade discount of 2% each.

March 31 125 calculators were sold during March at a unit selling price of $10,300.

March 31 An actual count of inventory was carried out which revealed that there were 28 units of that brand of merchandise in the store room.

Unless otherwise stated, assume that all purchases were on account and received on the dates stated. Required: i) Prepare a perpetual inventory record for this merchandise, using the first in, first out (FIFO) method of inventory valuation to determine the company’s cost of goods sold for the quarter and the value of ending.

ii) Given that selling, distribution and administrative costs for the quarter were $112,840, $102,100 and $103,760 respectively,

prepare an income statement for VenRam Stationery & Supplies for the quarter ended March 31, 2018.

iii) Journalize the January transactions, assuming the company uses a: - Periodic inventory system - Perpetual inventory system

iv) The manager of VenRam has stated that his objective is to cut back on his tax liability and is of the view that the FIFO method would be best. Do you agree with him?

Part b Callahan Computers stores its inventory in a warehouse that was destroyed by Hurricane Irma in September 2018. The business began the year with inventory of $350,000. During the year, the business made net purchases of $1,600,000 and had net sales of $2,500,000. The company’s gross profit has historically been 30% of net sales revenue. Use the gross profit method to estimate the cost of the ending inventory destroyed in the hurricane.

Shyan’s School Spot sells a variety of school supplies including a variety of calculators. The business began the first quarter (January to March) of 2018 with 20 (Casio fx-85MS) calculators at a total cost of $124,800. During the quarter, the company completed the following transactions.

January 8            105 calculators were purchased at a cost of $5,840 each. In addition, the business paid a freight charge of $610 cash on each calculator to have the inventory shipped from the point of purchase to their warehouse.

January 31          The sales for January were 85 calculators which yielded total sales revenue of $767,550. (25 of these units were sold on account to longstanding customers)

February 4          A new batch of 65 calculators was purchased at a total cost of $448,500

February 10        10 of the instruments purchased on February 4 were returned to the supplier, as they were not of the model ordered.

February 28        During the month 58 calculators were sold at a price of $9,660 each.

March 4               A customer, to whom 9 bicycles were sold during the first business day of February, returned 2 of the instruments, as they were of another brand.

March 10             Owing to an increased demand, a further 118 calculators were purchased at a cost of $7,500 each; these were subject to a trade discount of 2% each.

March 31             125 calculators were sold during March at a unit selling price of $10,300.

March 31             An actual count of inventory was carried out which revealed that there were 28 units of that brand of merchandise in the store room.

Unless otherwise stated, assume that all purchases were on account and received on the dates stated. d: i) Prepare a perpetual inventory record for this merchandise, using the first in, first out (FIFO) method of inventory valuation to determine the company’s cost of goods sold for the quarter and the value of ending.

ii) Given that selling, distribution and administrative costs for the quarter were $112,840, $102,100 and $103,760 respectively, prepare an income statement for Shyan’s School Spot for the quarter ended March 31, 2018.

iii) Journalize the January transactions, assuming the company uses a: - Periodic inventory system - Perpetual inventory system

iv) The manager of Shyan’s has stated that his objective is to cut back on his tax liability and is of the view that the FIFO method would be best. Do you agree with him?

Part b Comtech Computers stores its inventory in a warehouse that was destroyed by Hurricane Irma in September 2018. The business began the year with inventory of $350,000. During the year, the business made net purchases of $1,600,000 and had net sales of $2,500,000. The company’s gross profit has historically been 30% of net sales revenue. Use the gross profit method to estimate the cost of the ending inventory destroyed in the hurricane.

Production, Direct Labor, Direct Materials, Sales Budgets, Budgeted Contribution Margin

Greiner Company makes and sells high-quality glare filters for microcomputer monitors. John Craven, controller, is responsible for preparing Greiner’s master budget and has assembled the following data for the coming year. The direct labor rate includes wages, all employee-related benefits, and the employer’s share of FICA. Labor saving machinery will be fully operational by March. Also, as of March 1, the company’s union contract calls for an increase in direct labor wages that is included in the direct labor rate. Greiner expects to have 6,700 glare filters in inventory on December 31 of the current year, and has a policy of carrying 25 percent of the following month’s projected sales in inventory. Information on the first four months of the coming year is as follows:

Required:
Unless otherwise indicated, round all calculated amounts to the nearest dollar or unit.

1. Prepare the following monthly budgets for Greiner Company for the first quarter of the coming year.

a. Production budget in units:

b. Direct labor budget in hours: Round your answers to two decimal places, if required.

c. Direct materials cost budget:

d. Sales budget: Round unit selling price amounts to the nearest cent and use the same for subsequent requirements.

2. Calculate the total budgeted contribution margin for Greiner Company by month and in total for the first quarter of the coming year. (CMA adapted)

1. Production, Direct Labor, Direct Materials, Sales Budgets, Budgeted Contribution Margin

   Greiner Company makes and sells high-quality glare filters for microcomputer monitors. John Craven, controller, is responsible for preparing Greiner’s master budget and has assembled the following data for the coming year. The direct labor rate includes wages, all employee-related benefits, and the employer’s share of FICA. Labor saving machinery will be fully operational by March. Also, as of March 1, the company’s union contract calls for an increase in direct labor wages that is included in the direct labor rate. Greiner expects to have 6,900 glare filters in inventory on December 31 of the current year, and has a policy of carrying 35 percent of the following month’s projected sales in inventory. Information on the first four months of the coming year is as follows:

   	January	February	March	April
   Estimated unit sales	35,600	35,600	40,800	39,200
   Sales price per unit	$83	$83	$76	$76
   Direct labor hours per unit	2.70	2.70	2.40	2.40
   Direct labor hourly rate	$16	$16	$18	$18
   Direct materials cost per unit	$10	$10	$10	$10

   Required:
   Unless otherwise indicated, round all calculated amounts to the nearest dollar or unit.

   1. Prepare the following monthly budgets for Greiner Company for the first quarter of the coming year.

   a. Production budget in units:

   Greiner Company
   Production Budget (units)
   For the First Quarter of the Coming Year
   	January	February	March	Total
   Unit sales	35,600	35,600	40,800	39,200
   Desired ending inventory
   Total units required
   Less: Beginning inventory
   Units produced

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   b. Direct labor budget in hours: Round your answers to two decimal places, if required.

   Greiner Company
   Direct Labor Budget (hours)
   For the First Quarter of the Coming Year
   	January	February	March	Total
   Units produced
   Direct labor hours per unit	2.7	2.7	2.4
   Total labor budget (hours)

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   c. Direct materials cost budget:

   Greiner Company
   Direct Materials Cost Budget
   For the First Quarter of the Coming Year
   	January	February	March	Total
   Units produced
   Cost per unit	$	$	$	$
   Total direct materials	$	$	$	$

   Feedback

   d. Sales budget: Round unit selling price amounts to the nearest cent and use the same for subsequent requirements.

   Greiner Company
   Sales Budget (dollars)
   For the First Quarter of the Coming Year
   	January	February	March	Total
   Unit sales
   Unit selling price	$	$	$	$
   Total sales revenue	$	$	$	$

   Feedback

   2. Calculate the total budgeted contribution margin for Greiner Company by month and in total for the first quarter of the coming year. (CMA adapted)

   Greiner Company
   Budgeted Contribution Margin
   For the First Quarter of the Coming Year
   	January	February	March	Total
   Sales revenue	$	$	$	$
   Direct labor cost
   Materials cost
   Contribution margin	$	$	$	$

Production, Direct Labor, Direct Materials, Sales Budgets, Budgeted Contribution Margin

Greiner Company makes and sells high-quality glare filters for microcomputer monitors. John Craven, controller, is responsible for preparing Greiner’s master budget and has assembled the following data for the coming year. The direct labor rate includes wages, all employee-related benefits, and the employer’s share of FICA. Labor saving machinery will be fully operational by March. Also, as of March 1, the company’s union contract calls for an increase in direct labor wages that is included in the direct labor rate. Greiner expects to have 5,900 glare filters in inventory on December 31 of the current year, and has a policy of carrying 35 percent of the following month’s projected sales in inventory. Information on the first four months of the coming year is as follows:

Required:
Unless otherwise indicated, round all calculated amounts to the nearest dollar or unit.

1. Prepare the following monthly budgets for Greiner Company for the first quarter of the coming year.

a. Production budget in units:

b. Direct labor budget in hours: Round your answers to two decimal places, if required.

c. Direct materials cost budget:

d. Sales budget: Round unit selling price amounts to the nearest cent and use the same for subsequent requirements.

2. Calculate the total budgeted contribution margin for Greiner Company by month and in total for the first quarter of the coming year. (CMA adapted)

Which companies spend the most money on advertising? A news website maintains a list of the top-spending companies. In 2014, Company A spent more than any other company, a whopping $5.10 billion. In second place was Company B, which spent $3.18 billion. The top 12 companies and the amount each spent on advertising in billions of dollars are as follows.

(a)

What is the mean amount (in billion dollars) spent on advertising? (Round your answer to two decimal places.)

$  billion

(b)

What is the median amount (in billion dollars) spent on advertising?

$  billion

(c)

What are the first and third quartiles (in billion dollars)?

first quartile$  billionthird quartile$  billion

1. The “classical dichotomy” refers to the separation of:
(a) supply-side factors vs. demand-side factors.
(b) changes in the domestic (or closed) economy vs. changes abroad (or an open economy).
(c) short-run fluctuations vs. long-run economic growth.
(d) real vs. nominal variables.
(e) the public sector –government spending and tax revenues– vs. the private sector (C and I).

2. Which of the following does not explain the slope of the aggregate demand curve?
(a) the wealth effect.
(b) the interest-rate effect.
(c) sticky wages and sticky prices.
(d) the exchange-rate effect.
(e) decreasing utility of consumption.

3. The misperceptions theory mainly relates to:
(a) how an increase in government spending is financed –taxes or borrowing– and thus its effect on AD.
(b) one determining factor of the shape of the short-run aggregate supply.
(c) the distinction between national debt and simply the public debt and the confusion it causes.
(d) what is essentially a “broken window fallacy” issue and thus the net value of any fiscal policy action.
(e) workers not understanding fully changes in their nominal vs. changes in their real wage rates.

4. Over the business cycle, fluctuate(s) more (as percentage change) than any other
variable.
(a) inflation
(b) investment
(c) imports
(d) exports
(e) private consumption

5. Stagflation is usually thought of, or depicted by:
(a) the presence –and importance– of “animal spirits” in economies.
(b) a decrease in aggregate demand.

(c) a rise in government spending financed entirely by borrowing.
(d) falling prices for oil and other natural resources.
(e) aggregate supply shifting left (that is, decreasing)

Tempo Company's fixed budget for the first quarter of calendar yeat 2015 reveals the following:

Prepare flexible budgets that show variable costs per unit, fixed costs, and three different flexible budgets for sales volumes of 12,000, 14,000, and 16,000 units.