Problem 4-16 Contrasting ABC and Conventional Product Costs [LO4-2, LO4-3, LO4-4]

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

For many years, Thomson Company manufactured a single product called LEC 40. Then three years ago, the company automated a portion of its plant and at the same time introduced a second product called LEC 90 that has become increasingly popular. The LEC 90 is a more complex product, requiring 0.60 hours of direct labor time per unit to manufacture and extensive machining in the automated portion of the plant. The LEC 40 requires only 0.20 hours of direct labor time per unit and only a small amount of machining. Manufacturing overhead costs are currently assigned to products on the basis of direct labor-hours.

Despite the growing popularity of the company’s new LEC 90, profits have been declining steadily. Management is beginning to believe that there may be a problem with the company’s costing system. Direct material and direct labor costs per unit are as follows:

Management estimates that the company will incur $872,000 in manufacturing overhead costs during the current year and 80,000 units of the LEC 40 and 40,000 units of the LEC 90 will be produced and sold.

Problem 4-16 Part 1

Required:

1-a. Compute the predetermined overhead rate assuming that the company continues to apply manufacturing overhead cost on the basis of direct labor-hours.

1-b. Using this rate and other data from the problem, determine the unit product cost of each product.

Problem 4-16 Part 2

2. Management is considering using activity-based costing to assign manufacturing overhead cost to products. The activity-based costing system would have the following four activity cost pools:

Determine the activity rate for each of the four activity cost pools. (Round your answers to 2 decimal places.)

Problem 4-16 Part 3
3. Using the activity rates you computed in part (2), do the following:

a. Determine the per unit amount of manufacturing overhead cost that would be assigned to each product using the activity-based costing system.

b. Compute the unit product cost of each product.

MULTIPLE CHOICE QUESTIONS

QUESTION 14

1. Where does haematopoiesis take place?

   	1.	Lungs
   	2.	Pancreas
   	3.	Liver
   	4.	Bone marrow.

1 points   

QUESTION 15

1. The greatest medical problem with the Rh blood group is:           

   	1.	transfusion incompatibility
   	2.	chronic anemia for Rh negative individuals
   	3.	chronic anemia for Rh positive individuals
   	4.	none of the above

1 points   

QUESTION 16

1. In the ABO blood system, you normally can be type:

   	1.	A
   	2.	B
   	3.	ABO
   	4.	A, B, AB, or O
   	5.	All of the above

1 points   

QUESTION 17

1. When blood clumps or forms visible islands in the still liquid plasma, it is called:

   	1.	clotting
   	2.	agglutination
   	3.	none of the above

1 points   

QUESTION 18

1. More commonly called platelets

   	1.	Erythrocytes
   	2.	Leukocytes
   	3.	Thrombocytes

1 points   

QUESTION 19

1. Mother-fetus Rh blood type incompatibility problems can occur if the mother is _____ and her fetus is

   	1.	Rh positive; Rh positive
   	2.	Rh positive; Rh negative
   	3.	Rh negative; Rh positive
   	4.	Rh negative; Rh negative
   	5.	b and c

1 points   

QUESTION 20

1. An increased white blood cell count is indicative of which disease?

   	1.	Lupus
   	2.	Leukaemia
   	3.	Anaemia
   	4.	Melanoma

1 points   

QUESTION 21

1. Which of the following is the function of white blood cells?

   	1.	Transport oxygen.
   	2.	Maintain homeostasis.
   	3.	Defend against infection.
   	4.	Produce haemoglobin.

1 points   

QUESTION 22

1. More commonly called red blood cells

   	1.	Erythrocytes
   	2.	Leukocytes
   	3.	Thrombocytes

1 points   

QUESTION 23

1. Which of the following statements about erythrocytes is correct?

   	1.	They fight infection.
   	2.	They clot blood.
   	3.	They lack a nucleus.
   	4.	They are produced in the spleen

1 points   

QUESTION 24

1. What would happen to red blood cells if the haem group were removed from haemoglobin?

   	1.	Red blood cells would not be able to bind oxygen
   	2.	Red blood cells would not be able to reproduce
   	3.	White blood cells would not be able to reproduce
   	4.	Blood clot formation would be inhibited.

1 points   

QUESTION 25

1. Venous blood is :

   	1.	Bluish
   	2.	Dark red
   	3.	Bright red
   	4.	Pale red

Using the Patients dataset, create a scatter plot (similar to Figure 13.5) with patient’s age on the x-axis and length of stay on the y-axis. Make sure that you fully label this chart (title for the chart, x-axis, and y-axis). (5 points)

Follow the directions in EG13.2 (Excel Guide) at the end of Chapter 13 and create a linear trend line along with the linear regression equation and R-squared value. Interpret both the linear regression equation and the R-squared value. (10 points)

Now calculate the correlation coefficient and interpret it. What do you conclude about the relationship between a patient’s age and length of stay? (5 points)

(Question 6) To test whether students in a higher grade level will be less disruptive in class, a school psychologist records the number of documented interruptions during one day of classes from nine local high schools. The sample consisted of nine (n = 9) freshman, sophomore, junior, and senior high school classes. The data for each high school class are given in the table.

(a) Complete the F-table. (Round your answers to two decimal places.)

(b) Is it necessary to compute a post hoc test? Explain. (Assume alpha equal to 0.05.)

Yes, post hoc analyses are appropriate because the ANOVA is significant.

No, post hoc analyses are not appropriate because the ANOVA is not significant.   

Brief Exercise 4-4 (Algo) Multiple-step income statement [LO4-1, 4-3]

The following is a partial year-end adjusted trial balance.

Income tax expense has not yet been recorded. The income tax rate is 25%.

a. Determine the operating income (loss).
b. Determine the income (loss) before income taxes.
c. Determine the net income (loss).

Universal Calendar Company began the year with accounts receivable (net) and inventory balances of $270,000 and $50,000, respectively. Year-end balances for these accounts were $290,000 and $30,000, respectively. Sales for the year of $700,000 generated a gross profit of $220,000.

Calculate the receivables and inventory turnover ratios for the year.
  

give a) Domain b) VA c) HA* d) OA* e) y-int f) x-int for each

2) f(x) = 4 /3x - 9

3) g(x) = (x -1)(x + 4) /(x + 1)(x - 5)

4) h(x) = x ^2 + 4x/ x + 6

5) j(x) = x ^2 - 4 /(x + 2)(x - 3)

Problem 2. Use the FFT algorithm to evaluate f(x) = 8 − 4x + 2x 2 + 3x 3 − 5x 4 − 4x 5 + 2x 6 + x 7 at the eight 8th roots of unity mod 17. You may stop using recursion when evaluating a linear function (a + bx), which is easier to do directly. The eight 8th roots of unity mod 17 are 1, 2, 4, 8, 16, 15, 13, 9; it is easier to calculate with 1, 2, 4, 8, -1, -2, -4, -8. Do this by hand, and show your work.

John Bruno owns a factory producing electric cords. John observes that recently the number of cords with defect has increased. He monitors the 3 processing machines for 30 days for 100 cords per observation per machine. The results of John Bruno’s observations are presented in the table below. What can he do to make sure that the number of cords with defect to go down?

You need to find the number of defects per machine, then based on your results give your recommendations. You need to show your work and spread sheet if excel is used.

1. The table below shows the bushels of corn and bottles of wine that China and U.S. can produce from one day of labor under three different hypothetical situations.

1. Use the table above to show for each case the commodity in which each country has a comparative advantage or disadvantage. Show your work. Answer the question by calculating relative prices.