You are a marketing manager at a purse retailer. Last year you sold 1,300 purses at a price of $430 per purse. Your fixed costs are $50,000 and it costs you $110 to make each purse.

Calculate: Total revenue, average revenue, total cost, and unit variable cost.

Did you make a profit last year? How much?

You are deciding whether or not to participate in a national association of “Purse parties”, where all the attendees have to purchase your purse. Each party will cost you $1500. The expected number of attendees for each party is 30 women. You are also required by your boss to make a profit of at least $8000 by participating in each party.

Should you participate? Why or why not?

Hamline Manufacturing makes a single product. Standard costs are given below.

Manufacturing Cost Elements Quality * Price = Cost

Direct Materials 6 oz. * $0.90 = $5.40

Direct Labor 0.5hrs * 12.00 = 6.00

Manufacturing overhead 0.5hrs * 4.80 = 2.40

$13.80

During the month, the following transactions occurred in manufacturing 10,000 units.

58,000 ounces of materials were purchased at $1.00 per ounce.
All the materials purchased were used to produce the 10,000 units.
4,900 direct labor hours were worked at a total labor cost of $56,350.
Variable manufacturing overhead incurred was $15,000 and fixed overhead incurred was $10,400.

Compute the total variance and the variances for direct materials and direct labor elements.

Betty DeRose, Inc. operates two departments, the handling department and
the packaging department. During April, the handling department reported
the following information:

                                           % complete      % complete
                                units         DM           conversion 
work in process, April 1        18,000        38%             71%
units started during April      80,000
work in process, April 30       44,000        82%             47%

The cost of beginning work in process and the costs added during April
were as follows:

                                 DM         Conversion       Total cost
work in process, April 1      $ 51,764       $152,477         $204,241
costs added during April       191,452        232,125          423,577
total costs                    243,216        384,602          627,818

Calculate the direct material unit cost using the weighted average process
costing method.

t8

Weirick, Inc., manufactures and sells two products: Product T8 and Product P4. The company has an activity-based costing system with the following activity cost pools, activity measures, and expected activity:

The total overhead applied to Product P4 under activity-based costing is closest to: (Round your intermediate calculations to 2 decimal places.)

Multiple Choice

• $882,400

• $445,865

• $496,501

• $1,002,940

Betty DeRose, Inc. operates two departments, the handling department and
the packaging department. During April, the handling department reported
the following information:

                                           % complete      % complete
                                units         DM           conversion 
work in process, April 1        16,400        75%             66%
units started during April      56,000
work in process, April 30       47,600        82%             40%

The cost of beginning work in process and the costs added during April
were as follows:

                                 DM         Conversion       Total cost
work in process, April 1      $ 25,766       $ 90,794         $116,560
costs added during April       193,245        181,588          374,833
total costs                    219,011        272,382          491,393

Calculate the cost of goods that were started and completed in the month
of April using the FIFO process costing method.

Betty DeRose, Inc. operates two departments, the handling department and
the packaging department. During April, the handling department reported
the following information:

                                           % complete      % complete
                                units         DM           conversion 
work in process, April 1        16,400        75%             66%
units started during April      56,000
work in process, April 30       47,600        82%             40%

The cost of beginning work in process and the costs added during April
were as follows:

                                 DM         Conversion       Total cost
work in process, April 1      $ 25,766       $ 90,794         $116,560
costs added during April       193,245        181,588          374,833
total costs                    219,011        272,382          491,393

Calculate the cost of goods that were started and completed in the month
of April using the FIFO process costing method.

The MacCauley Company has sales of $200 million and total operating expenses (excluding depreciation) of $130 million. Straight-line depreciation on the company's assets is $15 million over 4 years. The Upfront Cost equals to the total depreciable value on the company’s assets. Assume that all taxable income is taxed at 30 percent. Assume also that net operating working is 3% of sales in each year. Calculate the MacCauley Company's WACC using 4% cost of debt, 12% cost of equity. There is 45% equity and 55% debt are on the company’s balance sheet. What is NPV? Would you invest in the project? Is IRR greater or smaller than WACC? What is the payback period? (There is no salvage value at the end of 4 years)

Betty DeRose, Inc. operates two departments, the handling department and
the packaging department. During April, the handling department reported
the following information:

                                           % complete      % complete
                                units         DM           conversion 
work in process, April 1        16,400        75%             66%
units started during April      56,000
work in process, April 30       47,600        82%             40%

The cost of beginning work in process and the costs added during April
were as follows:

                                 DM         Conversion       Total cost
work in process, April 1      $ 25,766       $ 90,794         $116,560
costs added during April       193,245        181,588          374,833
total costs                    219,011        272,382          491,393

Calculate the cost of goods completed and transferred out during April
using the FIFO process costing method.

Betty DeRose, Inc. operates two departments, the handling department and
the packaging department. During April, the handling department reported
the following information:

                                           % complete      % complete
                                units         DM           conversion 
work in process, April 1        16,400        75%             66%
units started during April      56,000
work in process, April 30       47,600        82%             40%

The cost of beginning work in process and the costs added during April
were as follows:

                                 DM         Conversion       Total cost
work in process, April 1      $ 25,766       $ 90,794         $116,560
costs added during April       193,245        181,588          374,833
total costs                    219,011        272,382          491,393

Calculate the cost of goods completed and transferred out during April
using the FIFO process costing method.

Betty DeRose, Inc. operates two departments, the handling department and
the packaging department. During April, the handling department reported
the following information:

                                           % complete      % complete
                                units         DM           conversion 
work in process, April 1        16,400        75%             66%
units started during April      56,000
work in process, April 30       47,600        82%             40%

The cost of beginning work in process and the costs added during April
were as follows:

                                 DM         Conversion       Total cost
work in process, April 1      $ 25,766       $ 90,794         $116,560
costs added during April       193,245        181,588          374,833
total costs                    219,011        272,382          491,393

Calculate the cost of goods that were started and completed in the month
of April using the FIFO process costing method.