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Question;2.value:4.00 pointsE13-8 Product costing-manufacturing overhead [LO 5]Winners, Inc., manufactures women's boating shoes. Manufacturing overhead is assigned to production on a machine-hour basis. For 2010, it was estimated that manufacturing overhead would total $353,730 and that 29,460 machine hours would be used.Required:(a)Calculate the predetermined overhead application rate that will be used for absorption costing purposes during 2010. (Round your answer to 2 decimal places. Omit the "$" sign in your response.)Predetermined overhead application rate$(b)During May, 3,700 pairs of shoes were made. Raw materials costing $6,770 were used, and direct labor costs totaled $9,350. A total of 770 machine hours were worked during the month of May. Calculate the cost per pair of shoes made during May. (Round your intermediate calculations and final answer to 2 decimal places. Omit the "$" sign in your response.)Cost per pair of shoes$(c)At the end of May, 1,310 pairs of shoes were in ending inventory. Calculate the cost of the ending inventory and the cost of the shoes sold during May. (Round your intermediate calculations and final answer to 2 decimal places. Omit the "$" sign in your response.)Cost of shoes in inventory$Cost of shoes sold$3.value:10.00 pointsP13-22 Cost of goods manufactured, cost of goods sold, and income statement [LO 4, 5, 7]Big Thunder Co. incurred the following costs during April:Raw materials purchased$40,130Direct labor ($13 per hour)56,810Manufacturing overhead (actual)90,440Selling expenses31,560Administrative expenses14,490Interest expense6,455Manufacturing overhead is applied on the basis of $22 per direct labor hour. Assume that overapplied or underapplied overhead is transferred to cost of goods sold only at the end of the year. During the month, 4,060 units of product were manufactured and 4,420 units of product were sold. On April 1 and April 30, Big Thunder Co. carried the following inventory balances:April 1April 30Raw materials$19,200$17,700Work in process52,80056,600Finished goods41,80024,884Requirement 1:(a)Prepare a statement of cost of goods manufactured for the month of April. (Amounts to be deducted should be indicated with minus sign. Omit the "$" sign in your response.)BigThunder Co.Statement of Cost of Goods ManufacturedFor the month of AprilRaw materials:(Click to select)Work-in-process, April 1Direct labor cost incurredManufacturing overhead appliedInventory, April 30Inventory, April 1$(Click to select)Inventory, April 30Manufacturing overhead appliedWork-in-process, April 1Purchases during AprilDirect labor cost incurredRaw materials available for use(Click to select)Less: Inventory, April 30Add: Work-in-process, April 1Add: Inventory, April 30Direct labor cost incurredLess: Work-in-process, April 30Cost of raw materials used$(Click to select)Purchases during AprilAdd: Work-in-process, April 1Inventory, April 1Direct labor cost incurredLess: Work-in-process, April 30(Click to select)Purchases during AprilLess: Work-in-process, April 30Manufacturing overhead appliedInventory, April 1Add: Work-in-process, April 1Total manufacturing costs, April$(Click to select)Add: Work-in-process, April 1Less: Inventory, April 30Inventory, April 1Purchases during AprilLess: Work-in-process, April 1(Click to select)Less: Inventory, April 30Inventory, April 1Add: Work-in-process, April 30Less: Work-in-process, April 30Purchases during AprilCost of goods manufactured, April$(b)Calculate the average cost per unit of product manufactured. (Round your answer to 2 decimal places. Omit the "$" sign in your response.)Cost per unit$Requirement 2:Calculate the cost of goods sold during April. (Do not round your intermediate calculations. Round your answer to the nearest dollar amount. Omit the "$" sign in your response.)Cost of goods sold$Requirement 3:(a)Calculate the difference between cost of goods manufactured and cost of goods sold. (Do not round your intermediate calculations. Round your answer to the nearest dollar amount. Input the amount as positive value. Omit the "$" sign in your response.)Difference$(b)How will this amount be reported in the financial statements?(Click to select)The difference between cost of goods manufactured and cost of goods sold is in the finished goods inventory account on the balance sheet.The difference between cost of goods manufactured and cost of goods sold is in the work in progress account on the balance sheet.The difference between cost of goods manufactured and cost of goods sold is in the raw material account on the balance sheet.Requirement 4:Prepare a traditional (absorption) income statement for Big Thunder Co. for the month of April. Assume that sales for the month were $284,500 and the company's effective income tax rate was 40%. (Amounts to be deducted should be indicated with minus sign. Do not round your intermediate calculations. Round your answer to the nearest dollar amount. Omit the "$" sign in your response.)BigThunder Co.Absorption Income StatementFor the month of April(Click to select)Interest expenseCost of goods soldSelling and administrative expensesIncome tax expenseSales$(Click to select)Cost of goods soldIncome tax expenseSalesSelling and administrative expensesInterest expense(Click to select)Gross profitGross loss$(Click to select)Selling and administrative expensesInterest expenseWages payableAdvertising expensesIncome tax expense(Click to select)Operating lossOperating income$(Click to select)Advertising expensesUnearned revenueInterest expenseSelling and administrative expensesWages expenses(Click to select)Advertising expensesWages expensesIncome before taxesUnearned revenueSelling and administrative expenses$(Click to select)Income tax expenseSelling and administrative expensesWages expensesUnearned revenueAdvertising expenses(Click to select)Net lossNet income$4.value:6.00 pointsP13-16 Activity-based costing versus traditional overhead allocation methods [LO 9]Galvaset Indutries manufactures and sells custom-made windows. Its job costing system was designed using an activity-based costing approach. Direct materials and direct labor costs are accumulated separately, along with information concerning three manufacturing overhead cost drivers (activities). Assume that the direct labor rate is $19 per hour and that there were no beginning inventories. The following information was available for 2010, based on an expected production level of 53,500 units for the year, which will require 218,000 direct labor hours:Activity(Cost Driver)BudgetedCosts for 2010Cost Driver Usedas Allocation BaseCostAllocation RateMaterials handling$261,600Number of parts used$0.28per partCutting and lathe work1,700,400Number of parts used1.45per partAssembly and inspection4,578,000Direct labor hours21.00per hourThe following production, costs, and activities occurred during the month of March:UnitsProducedDirectMaterials CostsNumberof Parts UsedDirectLabor Hours3,250$111,60043,75614,000Required:(a)Calculate the total manufacturing costs and the cost per unit of the windows produced during the month of March (using the activity-based costing approach). (Round "cost per unit produced" to 2 decimal places and the rest to the nearest dollar amount. Omit the "$" sign in your response.)Total manufacturing cost$Cost per unit produced$(b)Assume instead that Galvaset Industries applies manufacturing overhead on a direct labor hours basis (rather than using the activity-based costing system previously described). Calculate the total manufacturing cost and the cost per unit of the windows produced during the month of March. (Hint:You will need to calculate the predetermined overhead application rate using the total budgeted overhead costs for 2010.) (Do not round your intermediate calculations. Round "cost per unit produced" to 2 decimal places and the rest to the nearest dollar amount. Omit the "$" sign in your response.)Total manufacturing cost$Cost per unit produced$(c)Which approach do you think provides better information for manufacturing managers?(Click to select)Activity based costingDirect labor hours basis5.value:4.00 pointsE13-14 Variable versus absorption costing [LO 8]Conolly, Inc., manufactures pocket calculators. Costs incurred in making 9,450 calculators in April included $29,500 of fixed manufacturing overhead. The total absorption cost per calculator was $9.5.Required:(a)Calculate the variable cost per calculator. (Do not round your intermediate calculations. Round your answer to 2 decimal places. Omit the "$" sign in your response.)Variable cost per calculator$(b)The ending inventory of pocket calculators was 900 units higher at the end of the month than at the beginning of the month. By how much and in what direction (higher or lower) would operating income for the month of April be different under variable costing than under absorption costing? (Do not round your intermediate calculations. Omit the "$" sign in your response.)Operating income under variable costing will be $,(Click to select)higherlower thanunder absorption costing.(c)Express the pocket calculator cost in a cost formula. (Do not round your intermediate calculations. Round your answers to 2 decimal places. Omit the "$" sign in your response.)Total cost = $ + ($ / calculator ? number of calculators)value:20.00 pointsP14-18 Sales, production, purchases, and cash budgets [LO 4, 5, 8]Rolen, Inc., is in the process of preparing the fourth quarter budget for 2010, and the following data have been assembled:?The company sells a single product at a price of $50 per unit. The estimated sales volume for the next six months is as follows:September11,700 unitsOctober10,800 unitsNovember12,600 unitsDecember18,000 unitsJanuary8,100 unitsFebruary9,000 units?All sales are on account. The company's collection experience has been that 30% of a month's sales are collected in the month of sale, 68% are collected in the month following the sale, and 2% are uncollectible. It is expected that the net realizable value of accounts receivable (i.e., accounts receivable less allowance for uncollectible accounts) will be $397,800 on September 30, 2010.?Management's policy is to maintain ending finished goods inventory each month at a level equal to 30% of the next month's budgeted sales. The finished goods inventory on September 30, 2010, is expected to be 3,240 units.?To make one unit of finished product, 4 pounds of materials are required. Management's policy is to have enough materials on hand at the end of each month to equal 40% of the next month's estimated usage. The raw materials inventory is expected to be 18,144 pounds on September 30, 2010.?The cost per pound of raw material is $5, and 70% of all purchases are paid for in the month of purchase, the remainder is paid in the following month. The accounts payable for raw material purchases is expected to be $68,364 on September 30, 2010.Required:(a)Prepare a sales budget in units and dollars, by month and in total, for the fourth quarter (October, November, and December) of 2010. (Omit the "$" sign in your response.)OctoberNovemberDecemberTotalExpected sales in unitsSelling price per unit$$$$Total sales$$$$(b)Prepare a schedule of cash collections from sales, by month and in total, for the fourth quarter of 2010. (Omit the "$" sign in your response.)Cash collections from:OctoberNovemberDecemberTotalSeptember sales$$October sales$November sales$December salesTotal cash collections$$$$(c)Prepare a production budget in units, by month and in total, for the fourth quarter of 2010. (Amounts to be deducted should be indicated with minus sign.)OctoberNovemberDecemberTotalBeginning inventory of finished goodsUnits to be producedGoods available for saleDesired ending inventory of finishedgoods (30% of next month'sbudgeted sales)Quantity of goods sold(d)Prepare a materials purchases budget in pounds, by month and in total, for the fourth quarter of 2010. (Amounts to be deducted should be indicated with minus sign.)OctoberNovemberDecemberTotalBeginning inventory of raw materialsPurchases of raw materialsRaw materials available for useDesired ending inventory of rawmaterials (40% of next month'sestimated usage)Quantity of raw materials to beused in production(e)Prepare a schedule of cash payments for materials, by month and in total, for the fourth quarter of 2010. (Round your answers to the nearest dollar amount. Omit the "$" sign in your response.)Cash payments for:OctoberNovemberDecemberTotalSeptember purchases$$October purchases$November purchases$December purchasesTotal cash payments$$$$E13-10 Manufacturing overhead-over/underapplied [LO 5, 6][The following information applies to the questions displayed below.]Halte Co. makes specialty table lamps. Manufacturing overhead is applied to production on a direct labor hours basis. During November, the first month of the company?s fiscal year, $56,460 of manufacturing overhead was applied to Work in Process Inventory using the predetermined overhead application rate of $7.17 per direct labor hour.7.value:1.00 pointsE13-10 Part aRequired:(a)Calculate the number of hours of direct labor used during November. (Round your answer to nearest whole number.)Direct labor hours8.value:1.00 pointsE13-10 Part b(b)Actual manufacturing overhead costs incurred during November totaled $45,930. Calculate the amount of over- or underapplied overhead for November. (Input the amount as positive value. Omit the "$" sign in your response.)(Click to select)Overapplied overheadUnderapplied overhead

 

Paper#38234 | Written in 18-Jul-2015

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