_{Salem Corporation is producing product A. The company had problems related to quality. Customers have been returning the product in the last months.}

_{ABC costing method and ABM can be used to manage quality.}

_{a.   Define each type of quality-related activity and give one example of each activity type.}

_{b.   Suppose the managers implement an ABC system to measure the costs of quality. How could they use information from this system to improve the product?}

When a company produces more inventory than it sells to customers, would the absorption costing income statement profits or the variable costing income statements profits be higher for the period?

Explain why (200 words minimum)

Q 1      Salem Corporation is producing product A. The company had problems related to quality. Customers have been returning the product in the last months.

            ABC costing method and ABM can be used to manage quality.

a.   Define each type of quality-related activity and give one example of each activity type.

b.   Suppose the managers implement an ABC system to measure the costs of quality. How could they use information from this system to improve the product?

Q 1 Salem Corporation is producing product A. The company had problems related to quality. Customers have been returning the product in the last months.

   ABC costing method and ABM can be used to manage quality.

a.   Define each type of quality-related activity and give one example of each activity type.

b.   Suppose the managers implement an ABC system to measure the costs of quality. How could they use information from this system to improve the product?

plz no photo answers or handwriting.

John’s Custom Computer Shop (JCCS) assembles computers for both individual and corporate customers. The company is organized into two divisions: Personal and Business. Once a computer is built, it is shipped to the customer. Billing for all customers is handled by the corporate Accounts Receivable Department. Accounts Receivable performs two major activities: billing and dispute resolution. Billing refers to preparing and sending the bills as well as processing the payments. Dispute resolution occurs when a customer refuses to pay, usually due to an error in billing.

The costs of the Accounts Receivable Department are allocated to the two divisions based on the number of bills prepared. Kyle, the manager of the Business division, has complained that the allocated costs from Accounts Receivable are beginning to make the business division look unprofitable and has asked you to recommend some changes to the allocation system. If he agrees with your recommendation, he will pass them on to the chief financial officer.

Data on costs and activities in the Accounts Receivable Department follow.

The Accounts Receivable Department incurred the following costs during the year.

Required:

a. Under the current allocation system, what is the cost that will be allocated from Accounts Receivable to Personal? To Business?

Allocated Costs: Personal? Business?

b. Suppose the company implements an activity-based cost system for Accounts Receivable with two activities, billing and dispute resolution. What is the cost that will be allocated from Accounts Receivable to Personal? To Business? Use the number of bills prepared as the cost driver for billing costs and the number of disputes for dispute resolution costs.

Billing for Personal? Billing for Business?

Dispute Resolution for Personal? Dispute Resolution for Business?

Levine Company uses the perpetual inventory system and allows customers to use two credit cards in charging purchases. With the Suntrust Bank Card, a 4% service charge for credit card sales is assessed. The second credit card that Levine accepts is the Continental Card. Continental assesses a 2.5% charge on sales for using its card.

Prepare journal entries to record the above selected credit card transactions of Levine Company

Worst Buy Company has had a lot of complaints from customers of late, and its stock price is now only $5 per share. It is going to employ a one-for-six reverse stock split to increase the stock value. Assume Dean Smith owns 144 shares.

a. How many shares will he own after the reverse stock split? (Do not round intermediate calculations and round your answer to the nearest whole number.)
  

b. What is the anticipated price of the stock after the reverse stock split? (Do not round intermediate calculations and round your answer to 2 decimal places.)

c. Because investors often have a negative reaction to a revere stock split, assume the stock only goes up to 70 percent of the value computed in part b. What will the stock’s price be? (Do not round intermediate calculations and round your answer to 2 decimal places.)

d. How has the total value of Dean Smith’s holdings changed from before the reverse stock split to after the reverse stock split (based on the stock value computed in part c)? To get the total value before and after the split, multiply the shares held times the stock price. (Input the amount as a positive value. Do not round intermediate calculations and round your answer to 2 decimal places.)
  

Sweet Dates Company offers a premium to its customers—a glass bowl (cost to Sweet Dates is $0.90) upon return of 40 coupons. Two coupons are placed in each box of dates sold. The company estimates, on the basis of past experience, that only 70% of the coupons will ever be redeemed. During 2016, 10 million boxes of dates are sold, for cash, at $0.30 each. Eight million coupons are redeemed during 2016. Sweet Dates purchased 360,000 glass bowls for the plan on January 1, 2016.

q2

On January 1, 2017, Fro-Yo Inc. began offering customers a cash rebate of $5.00 if the customer mails in 10 proof-of-purchase labels from its frozen yogurt containers. Based on historical experience, the company estimates that 20% of the labels will be redeemed. During 2017, the company sold 5,000,000 frozen yogurt containers at $1, cash, per container. From these sales, 800,000 labels were redeemed in 2017, 150,000 labels were redeemed in 2018, and the remaining labels were never redeemed.

Towing Company employs a periodic inventory system and sells its inventory
to customers for $34 per unit. Towing Company had the following inventory
information available for the month of May:

May 1    Beginning inventory 2,200 units @ $17 cost per unit
May 8    Sold 1,700 units
May 13   Purchased 1,800 units @ $13 cost per unit
May 18   Sold 1,600 units
May 21   Purchased 1,300 units @ $23 cost per unit
May 22   Purchased 1,100 units @ $15 cost per unit 
May 28   Sold 1,300 units
May 30   Purchased 1,600 units @ $10 cost per unit

During May, Towing Company reported operating expenses of $49,000 and had
an income tax rate of 32%.

Calculate the dollar amount of ending inventory shown on Towing Company's
May 31 balance sheet using the weighted average method.

ABC Company employs a periodic inventory system and sells its inventory
to customers for $23 per unit. ABC Company had the following inventory
information available for the month of May:

May 1    Beginning inventory 1,500 units @ $12 cost per unit
May 8    Sold 1,100 units
May 13   Purchased 1,700 units @ $21 cost per unit
May 18   Sold 1,000 units
May 21   Purchased 1,600 units @ $18 cost per unit
May 28   Sold 800 units
May 30   Purchased 1,200 units @ $20 cost per unit

During May, ABC Company reported operating expenses of $5,000 and had
an income tax rate of 36%.

Calculate the amount of net income reported on ABC Company's income
statement for May using the LIFO method.