Question 1
Super Electronic Company (Super) manufactures and sells three models
of computer chip to a customer. Sales revenue and direct costs for the
third quarter of 2018 are shown as follows:
Model SE-1 SE-2 SE-3
Units produced and sold 8,000 12,000 20,000
Unit selling price $60 $50 $35
Sales revenue $480,000 $600,000 $700,000
Direct materials $140,000 $320,000 $364,000
Direct labour $120,000 $190,000 $168,000
Machine hours consumed 300 hours 90 hours 60 hours
The company adopts a simple costing system by allocating the
manufacturing overhead based on the machine hours which are used to
manufacture the three models.
Manufacturing overhead incurred in the month includes the following:
Activity $
Engineering 125,000
Quality control 30,000
Machinery 128,000
Materials handling 77,000
360,000

Recently the company has learned that an activity-based costing system
can provide more accurate cost information by analysing how the
products use the activities during the operating processes. The following
data were collected from operations during the quarter:
Activity Cost Driver SE-1 SE-2 SE-3
Engineering No. of engineering hours 60 100 240
Quality control No. of inspection hours 36 120 204
Machinery No. of machine hours 300 90 60
Materials handling No. of orders 5 5 20

Required:
a Use the current simple costing system to prepare a product line and
total company income statement with profitability %. Show all your
workings.
b Use the activity-based costing system to prepare the product line
and total company income statement with profitability %. Show all
your workings.
c Compare and explain differences in product costs under both
product costing systems. Briefly discuss whether the ABC system
would bring any benefit to Super.
d What are the implications for Super’s pricing strategy?

. Star Smoothie in Summerville, South Carolina specializes in smoothies but also sells light breakfast and lunch items as well as coffee, tea, and soda. The owner noticed that many customers bring their computers to do work while enjoying a smoothie. He wants to support these customers by offering them wireless Internet access. A recent customer survey also indicated that many customers loved the smoothies but were frustrated by the time to wait in line and to wait for the smoothie to be made. One of the employees suggests that an order-ahead application would allow customers to choose and pay for a smoothie from their phones and then just stop in at the specified time to pick them up. The owner wants to integrate support for making and fulfilling such orders. Currently the only forms of communication the shop owners have are a telephone and a credit card machine for payments. The owner has asked you to design a network that will allow customer Internet access, will support the order-ahead idea, and will allow customers to move inventory, finances, and other records to electronic systems.

You have already conducted a needs analysis for the network of the business you are working with. The next step is to translate that understanding of various users in terms of what they need into a specific list of design requirements. This will serve as a checklist for your design. For each item, you should provide a brief description of why that specific requirement is necessary.

Possible examples include:

• Password-protected guest wireless access: The business wants to allow customers to access the Internet, but does not want general open access. This customer access should not give access to other network resources or computers and should not allow customers to access one another’s computers when logged on.
• Shared data storage with version control: Employees often collaborate on documents and other materials. Common, shared access is needed for these materials. Employees should know when someone else is working on the materials or when changes have been made to support collaboration without inadvertently losing work.
• Internet access: All computers on the company network need to be able to access the Internet through a shared modem.

Assignment (3–5 pages):

Create a list consisting of at least ten specific requirements for the network you are designing. Explain each requirement in terms of the needs of the business you have chosen to work with.

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

Roland had a taxable estate of $15.9 million when he died this year.

Calculate the amount of estate tax due (if any) under the following alternatives. (Refer to Exhibit 25-1 and Exhibit 25-2.) (Enter your answers in dollars and not in millions of dollars.)

a. Roland’s prior taxable gifts consist of a taxable gift of $1 million in 2005.

Create a snowflake schema diagram (you do not have to mark every possible level) and include your implicit assumptions for each level of the dimension.

Starting with the base cuboid [customer, date, product, store], what are the specific OLAP operations (e.g., roll-up student to the department (level)) that one should perform in order to list the average sales of each cosmetic product since January 2005?

E3-12B The following T accounts summarize the ledger of Max’s Landscaping Company, Inc. at the end of the first month of operations.

Instructions

(a) Prepare, in the order they occurred, the journal entries (including explanations) that resulted in the amounts posted to the accounts.

(b) Prepare a trial balance at April 30, 2014. (Hint: Compute ending balances of T accounts first.)

Until recently, Woodbest Limited has been the leading producer of wood furniture in Malona city. Following the arrival of a major competitor in the city, Woodbest is seeking to explore innovative ways of maintaining its position in the market. In the meantime, it is relying on its competencies in the acquisition of materials, production, transportation of finished products and installations. The perfect coordination of these activities and its five-year maintenance-free policy for customers have so far kept the company in competition but it has to use strong strategic initiatives to stay ahead of the new competitor.
As a consultant in Operations Management, you are to:

Describe, with an example each, any three (3) competitive operations strategies that can be used by Woodbest to stay ahead of the competition.

Describe any two (2) growth strategies that can be used by the company to increase its capacity of operations.

Draw a value chain to illustrate the activities of Woodbest Limited.

3.On October 1, 2018, Pastina signed a $57,000 note that requires interest to paid annually on September 30 at 12% and will have principal due in 10 years.

Note: Enter debits before credits.

4.On March 1, 2018, the company lent $27,000. The note required principal and interest at 8% be paid on February 28, 2019.

5.On April 1, 2018, the company paid $6,840 for a two-year fire insurance policy and debited the entire amount to insurance expense.

Note: Enter debits before credits.

6.Supplies on hand at December 31, 2018 were $700.

Note: Enter debits before credits.

Rexon Company leases equipment to Ten-Care Company beginning January 1, 2016. The lease terms, provisions, and related events are as follows:

1. What is the easiest asset to convert into cash and explain why?

2. Revenue generating assets can also be linked to debt. What is the maximum a company can be financed at?

As an auditor, a common task is to verify that expenditures of a company are properly classified as capital or revenue expenditures. Discuss the determinants of such classifications. If an expenditure is capitalized, is such expenditure ever expensed? If so, how?