Luzadis Company makes furniture using the latest automated technology. The company uses a job-order costing system and applies manufacturing overhead cost to products on the basis of machine-hours. The predetermined overhead rate was based on a cost formula that estimates $1,368,000 of total manufacturing overhead for an estimated activity level of 72,000 machine-hours.
During the year, a large quantity of furniture on the market resulted in cutting back production and a buildup of furniture in the company’s warehouse. The company’s cost records revealed the following actual cost and operating data for the year:
|
Machine-hours |
61,000 |
|
|
Manufacturing overhead cost |
$ |
1,324,000 |
|
Inventories at year-end: |
||
|
Raw materials |
$ |
16,000 |
|
Work in process (includes overhead applied of $115,900) |
$ |
188,000 |
|
Finished goods (includes overhead applied of $208,620) |
$ |
338,400 |
|
Cost of goods sold (includes overhead applied of $834,480) |
$ |
1,353,600 |
Required:
1. Compute the underapplied or overapplied overhead.
2. Assume that the company closes any underapplied or overapplied overhead to Cost of Goods Sold. Prepare the appropriate journal entry.
3. Assume that the company allocates any underapplied or overapplied overhead proportionally to Work in Process, Finished Goods, and Cost of Goods Sold. Prepare the appropriate journal entry.
4. How much higher or lower will net operating income be if the underapplied or overapplied overhead is allocated to Work in Process, Finished Goods, and Cost of Goods Sold rather than being closed to Cost of Goods Sold?
In: Accounting
Luzadis Company makes furniture using the latest automated technology. The company uses a job-order costing system and applies manufacturing overhead cost to products on the basis of machine-hours. The predetermined overhead rate was based on a cost formula that estimates $592,000 of total manufacturing overhead for an estimated activity level of 74,000 machine-hours. During the year, a large quantity of furniture on the market resulted in cutting back production and a buildup of furniture in the company’s warehouse.
The company’s cost records revealed the following actual cost and operating data for the year:
Machine-hours 67,000
Manufacturing overhead cost $ 551,000
Inventories at year-end: Raw materials $ 13,000
Work in process (includes overhead applied of $37,520) $ 139,300
Finished goods (includes overhead applied of $101,840) $ 378,100
Cost of goods sold (includes overhead applied of $396,640) $ 1,472,600
Required:
1. Compute the underapplied or overapplied overhead.
2. Assume that the company closes any underapplied or overapplied overhead to Cost of Goods Sold. Prepare the appropriate journal entry.
3. Assume that the company allocates any underapplied or overapplied overhead proportionally to Work in Process, Finished Goods, and Cost of Goods Sold. Prepare the appropriate journal entry.
4. How much higher or lower will net operating income be if the underapplied or overapplied overhead is allocated to Work in Process, Finished Goods, and Cost of Goods Sold rather than being closed to Cost of Goods Sold?
In: Accounting
Luzadis Company makes furniture using the latest automated technology. The company uses a job-order costing system and applies manufacturing overhead cost to products on the basis of machine-hours. The predetermined overhead rate was based on a cost formula that estimates $880,000 of total manufacturing overhead for an estimated activity level of 88,000 machine-hours.
During the year, a large quantity of furniture on the market resulted in cutting back production and a buildup of furniture in the company’s warehouse. The company’s cost records revealed the following actual cost and operating data for the year:
| Machine-hours | 79,000 | |
| Manufacturing overhead cost | $ | 836,000 |
| Inventories at year-end: | ||
| Raw materials | $ | 15,000 |
| Work in process (includes overhead applied of $71,100) | $ | 171,900 |
| Finished goods (includes overhead applied of $134,300) | $ | 324,700 |
| Cost of goods sold (includes overhead applied of $584,600) | $ | 1,413,400 |
Required:
1. Compute the underapplied or overapplied overhead.
2. Assume that the company closes any underapplied or overapplied overhead to Cost of Goods Sold. Prepare the appropriate journal entry.
3. Assume that the company allocates any underapplied or overapplied overhead proportionally to Work in Process, Finished Goods, and Cost of Goods Sold. Prepare the appropriate journal entry.
4. How much higher or lower will net operating income be if the underapplied or overapplied overhead is allocated to Work in Process, Finished Goods, and Cost of Goods Sold rather than being closed to Cost of Goods Sold?
In: Accounting
Luzadis Company makes furniture using the latest automated technology. The company uses a job-order costing system and applies manufacturing overhead cost to products on the basis of machine-hours. The predetermined overhead rate was based on a cost formula that estimates $612,000 of total manufacturing overhead for an estimated activity level of 68,000 machine-hours.
During the year, a large quantity of furniture on the market resulted in cutting back production and a buildup of furniture in the company’s warehouse. The company’s cost records revealed the following actual cost and operating data for the year:
| Machine-hours | 50,000 | |
| Manufacturing overhead cost | $ | 570,000 |
| Inventories at year-end: | ||
| Raw materials | $ | 18,000 |
| Work in process (includes overhead applied of $22,500) | $ | 93,500 |
| Finished goods (includes overhead applied of $76,500) | $ | 317,900 |
| Cost of goods sold (includes overhead applied of $351,000) | $ | 1,458,600 |
Required:
1. Compute the underapplied or overapplied overhead.
2. Assume that the company closes any underapplied or overapplied overhead to Cost of Goods Sold. Prepare the appropriate journal entry.
3. Assume that the company allocates any underapplied or overapplied overhead proportionally to Work in Process, Finished Goods, and Cost of Goods Sold. Prepare the appropriate journal entry.
4. How much higher or lower will net operating income be if the underapplied or overapplied overhead is allocated to Work in Process, Finished Goods, and Cost of Goods Sold rather than being closed to Cost of Goods Sold?
In: Accounting
Catastrophe Bond
A) What is the origin of catastrophe bonds?
B) How has the issuance of catastrophe bonds changed since 2010? What is driving that
change?
C) What activities does the SPV perform for a catastrophe bond?
In: Finance
Use reliable online resources to research Dodd–Frank Wall Street Reform and Consumer Protection Act, 2010 write a comment about each provision of this comprehensive Financial Reform that relates to real estate activities.
In: Accounting
What are some current trends in the labor market?What are the current unemployment rate trends?Describe the changes in percentage terms and relate the changes in employment to the growth of the U.S. economy between the two years of 2010 and 2017.
In: Economics
In: Economics
Greenweed Limited manufactures specially treated garden benches. The following information was extracted from the budget for the year ended 29 February 2020:
The estimated sales for the financial year are 2000 units. The selling price per garden bench is R450. Variable production cost per garden bench comprises of the following:
Direct materials: R135
Direct Labour: R90
Overheads: R45
The cost for fixed production overheads are R127 500 and selling and administrative expenses are broken down as follows:
Salary of sales manager for the year: R75 000
Sales commission: 10% of sales
Required: (Round of answers to the nearest rand or whole number)
4.1 Calculate the breakeven quantity.
4.2 Determine the break-even value using the marginal income ratio.
4.3 Calculate the margin of safety.
4.4 Determine the number of sales units required to make a profit of R150 000.
In: Accounting
You want to buy a house in Whittier CA that costs $1,067,000. You have a down payment equal
to 23% of that price, and you have found a bank that will loan you the remainder (ignore closing
costs, property taxes, etc..). The interest rate on this mortgage is 4.75% p.a. with monthly
compounding (APR), this rate is fixed for 30 years, and payments on the loan are made monthly
(in arrears, as with most mortgages). Assume that you will take out the loan on October 1st, 2020.
What is your monthly mortgage payment? ($4,285.80) On what date is the first payment due and
on what date is the last one due?
2) Create an amortization table for the mortgage described in #1 above.
a. What is the amount of principal paid with the payment made in July 2033? ($1,884.38)
b. What is the amount of interest paid with the payment made in October 2040? ($1,628.54)
In: Finance