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Logan and Phillips

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Logan and Phillips;1. (multiple choice);Logan and Phillips, an accounting firm, provides consulting and tax planning services. A recent analysis found that 55% of the billable hours to clients resulted from tax planning and for many years, the firm`s total administrative e cost (currently $270,000) has been allocated to services on this basis.;The firm, contemplating a change to activity based costing has identified three components of administrative cost, as follows;Staff support 200,000;In-house computing charges 50,000;Misc. office costs 20,000;Total 270,000;A recent analysis of support staff found a strong correlation with the number of clients served. In contrast, in-house computing and misc. office cost varied directly with the number of computer hours logged and number of client transactions, respectively. Consulting clients served totaled 35% of the total client transactions.;IfLogan and Phillipsswitched firm its current accounting method to an activity based costing system, the amount of admin cost chargeable to consulting services would;a- Decrease by 32,500;b- Increase by 32,000;c- Decrease by 59,500;d- Other;e- Change but amount cannot be calculated with present info;2, (Multiple choice);The following data relate toABC Corporation for the year just ended;Sales revenue: 750,000;Cost of goods sold;Variable portion: 370,000;Fixed portion: 110,000;Variable selling and administrative: 50,000;Fixed selling and administrative: 75,000;Which of the following statements is correct?;A. ABC's variable-costing income statement would reveal a gross margin of $270,000;B. ABC's variable-costing income statement would reveal a contribution margin of $330,000;C. ABC's absorption-costing income statement would reveal a contribution margin of $330,000;D. ABC's absorption-costing income statement would reveal a gross margin of $330,000;E. ABC's absorption-costing income statement would reveal a gross margin of $145,000;3. Seneca Hardwoods produces handcrafted jewelry boxes. A standard-size box requires 7 board feet of hardwood in the finished product. In addition, 1.5 board feet of scrap lumber is normally left from the production of one box. Hardwood costs $5.00 per board foot, plus $1.20 in transportation charges per board foot.;Question: Compute the standard direct-material cost of a jewelry box.;4. Canandaigua Container Company manufactures recyclable soft-drink cans. A unit of production is a case of 12 dozen cans. These following standards have been set by the production-engineering staff and the controller.;Direct labor: Direct material;Quantity,.25 hour Quantity, 4 kilograms;Rate, $12 per hour Price, $0.60 per kilogram;Actual material purchases amounted to 240,000 kilograms at $0.62 per kilogram. Actual costs incurred in the production of 50,000 units were as follows;Direct labor: $158,600 for 13,000 hours;Direct material: $130,200 for 210,000 kilograms;Build a spreadsheet:Construct an Excel spreadsheet to solve the preceding requirement. Show how the solution will change if the following information changes: the standard direct labor rate is $14 per hour, and the standard direct-material price is $0.59 per kilogram.;5. Boundaries, a chain of retail stores, sell books and music CDs. Condensed monthly income data are presented in the following table for November 20X6. (ignore income taxes);Downtown store Mall store Total;Sales $240,000- $360,000- $600,000-;less: variable expenses $96,000= $252,000= $348,000=;Contribution margin $144,000- $108,000- $252,000-;less: fixed expenses $60,000= $120,000= $180,000=;Operating income $84,000 ($12,000) $72,000;Additional information;Management estimates that closing the mall store would result in a 10% decrease in downtown store sales, while closing the downtown store would not affect mall store sales. one-fourth of each store's fixed expenses would continue through December 31, 20x7, if either store were closed.;Build a spreadsheet: Construct an excel spreadsheet to solve all of the preceding requirements. Show how the solution will change if the following information changes: the downtown store?s sales amounted to $235,000, and its variable expenses were $90,000.

 

Paper#28605 | Written in 18-Jul-2015

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