Suppose Zume's sales price is 19, variable cost per unit is 8, and fixed cost is 416. Zume sells 1500 pizzas. What is Zume’s Margin of Safety in sales dollars? (HINT: Use Contribution Margin Ratio). (Round ONLY you final answer to 2 digits...keep at least 3 digits on CM ratio during calculations )

Why do accountants normally calculate cost per unit as an average?

Determining the exact cost of a product is virtually impossible.

Some manufacturing-related costs cannot be accurately traced to specific units of product.

Even when producing multiple units of the same product, normal variations occur in the amount of materials and labor used.

All of these are justifications for computing average unit costs.

Please explain the difference between job cost and process cost systems in one to two paragraphs.

Given:

Treatment E: Cost = $5,000, benefit = survival rate of 60%

Treatment F: Cost = $7,000, benefit = survival rate of 50%

Treatment G: Cost = $4,000, benefit = survival rate of 40%

Treatment H: Cost =$5,000, benefit = survival rate of 30%

Treatment K: Cost =$3,000, benefit = survival rate of 55%

Treatment J: Cost = $6,000, benefit = survival rate of 68%

1.

What are the ICERS of

K to E?

K to J?

$272.73; $23,076.92

$40,000; $4,000

$23,076.92; $40,000

$4,000; $23,076.92

$40,000; $23,076.92

2.

From K which treatment do we choose next?

E

J

H

G

none of the above

1. A job cost sheet of Vaughn Company is given below.

Answer the following questions.

(a) What are the source documents for direct materials, direct labor, and manufacturing overhead costs assigned to this job?

(b) What is the predetermined manufacturing overhead rate? (Round answer to 0 decimal places, e.g 135.)

(c) What are the total cost and the unit cost of the completed job? (Round unit cost to 2 decimal places, e.g. 1.25.)

2. Kevin Hall and Associates, a CPA firm, uses job order costing to capture the costs of its audit jobs. There were no audit jobs in process at the beginning of November. Listed below are data concerning the three audit jobs conducted during November.

Overhead costs are applied to jobs on the basis of auditor hours, and the predetermined overhead rate is $54 per auditor hour. The Wildhorse Inc. job is the only incomplete job at the end of November. Actual overhead for the month was $12,100.

(a) Determine the cost of each job.

(b) Indicate the balance of the Service Contracts in Process account at the end of November.

(c) Calculate the ending balance of the Operating Overhead account for November.

Calculation of Cost of Goods Sold: Periodic Inventory System Prepare the cost of goods sold section for Adams Gift Shop. The following amounts are known: Beginning merchandise inventory $27,050 Ending merchandise inventory 22,550 Purchases 77,125 Purchases returns and allowances 4,055 Purchases discounts 5,745 Freight-in 230 Adams Gift Shop Cost of Goods Sold Cost of goods sold: $ $ $ $ $ Cost of goods sold $

Cost behavior. VW has determined the following cost information at a volume of 16,000 units: Total variable expenses = $108,000 and average cost = $13.00. Assuming 40,000 units is within the relevant, compute TOTAL cost at a volume of 40,000 units.

RooPhone Inc. uses the product cost concept of applying the cost-plus approach to product pricing. The costs of producing and selling 5,000 units of cellular phones are as follows:   (7 points)

Variable costs                                                  Fixed Costs:

Direct materials    $625,000                     Factory overhead                     $215,000

Direct labor                     225,000                    Selling & Admin. expenses          75,000

Factory Overhead           200,000

Selling & admin. Exp.    150,000

                                    $1,200,000

RooPhone desires a profit equal to a 18% rate of return on invested assets of $550,000.

Required:

a.) Determine the amount of desired profit.

b.) Determine the product cost per unit for the production of 5,000 phones.

c.) Determine the total cost markup percentage (e.g. 20%) using the product cost concept.

d.) Determine the selling price of each cellular phone. Round to nearest dollar.

1) ABC Co. purchased machinery that cost $200,000 on January 1, 2018. The entire cost was recorded as an expense. The machinery has a nine-year life and a $10,000 residual value. The error was discovered on December 20, 2021. Ignore income tax considerations.

ABC’s income statement for the year ended December 31, 2021, should show depreciation expense of          _______

3) Equipment was purchased at the beginning of 2018 for $900,000. At the time of its purchase, the equipment was estimated to have a useful life of five years and a salvage value of $100,000. The equipment was depreciated using the straight-line method of depreciation through 2021. At the beginning of 2022, the estimate of useful life was revised to a total life of eight years and the expected salvage value was changed to $30,000. The amount to be recorded for depreciation for 2022 is _______

7) XYZ Co. began operations on January 1, 2020. Financial statements for 2020 and 2021 contained the following errors:

                                        Dec. 31, 2020             Dec. 31, 2021   

     Ending inventory $198,000 overstated $219,000 understated

     Depreciation expense 126,000 overstated               —

No corrections have been made for any of the errors. Ignore income tax considerations.

The total effect of the errors on the balance of XYZ’s retained earnings at December 31, 2021 is overstated or understated by          _______

The following cost functions apply to X Company's regular production and sales during the year:

  Cost of goods sold:   $6.05 (X) + $131,670

  Selling and administrative expenses:   $1.02 (X) + $81,130

where X is the number of units produced and sold. During the year, X Company sold 66,500 units for $17.00 each. At the end of the year, a company offered to buy 4,620 units but was only willing to pay $12.00 each. X Company had the capacity to produce the additional 4,620 units.

5. If X Company had accepted the special order, firm profits would have increased by

6. Consider the following three changes. Direct material costs on the special order would have increased by $0.86 per unit, direct labor costs on the special order would have decreased by $0.46 per unit, and X Company would have had to rent special equipment for $1,500. Independent of your answer to (5), the effect of these changes would have been to reduce profit on the special order by

7. In order to retain all of X Company's regular customers, it would have had to reduce the regular selling price by $0.43. If the selling price were reduced and next year's unit sales turned out to be the same as this year's sales, firm profits would have fallen by