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Accounting problems Assignment Set1

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Question;E13-8 Product costing-manufacturing overhead [LO 5]Winners, Inc., manufactures women's boating shoes. Manufacturing overhead is assigned to productionon a machine-hour basis. For 2010, it was estimated that manufacturing overhead would total $353,730and that 29,460 machine hours would be used.Required:(Calculate the predetermined overhead application rate that will be used for absorption costinga purposes during 2010. (Round your answer to 2 decimal places. Omit the "$" sign in your) response.)Predetermined overhead applicationrate$(During May, 3,700 pairs of shoes were made. Raw materials costing $6,770 were used, and directb labor costs totaled $9,350. A total of 770 machine hours were worked during the month of May.) Calculate the cost per pair of shoes made during May. (Round your intermediate calculations andfinal answer to 2 decimal places. Omit the "$" sign in your response.)Cost per pair ofshoes$(At the end of May, 1,310 pairs of shoes were in ending inventory. Calculate the cost of the endingc inventory and the cost of the shoes sold during May. (Round your intermediate calculations and)final answer to 2 decimal places. Omit the "$" sign in your response.)Cost of shoes in inventoryCost 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:RawmaterialspurchasedDirect labor($13 per hour)Manufacturing overhead(actual)SellingexpensesAdministrativeexpensesInterestexpense$40,13056,81090,44031,56014,4906,455Manufacturing overhead is applied on the basis of $22 per direct labor hour. Assume that overapplied orunderapplied 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:April1RawmaterialsWork inprocessFinishedgoods$April 3019,200$17,70052,80056,60041,80024,884Requirement 1:(Prepare a statement of cost of goods manufactured for the month of April. (Amounts to be deductedashould 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-inprocess, April 1Direct laborcost incurredManufacturingoverhead appliedInventory,April 30Inventory, April 1(Click to select)Inventory,April 30Manufacturingoverhead appliedWork-inprocess, April 1Purchasesduring AprilDirect labor costincurred$Raw materials availablefor use(Click to select)Less:Inventory, April 30Add: Workin-process, April 1Add:Inventory, April 30Direct laborcost incurredLess: Work-inprocess, April 30Cost of raw materialsused(Click to select)Purchasesduring AprilAdd: Work-in-$process, April 1Inventory,April 1Direct labor costincurredLess: Work-inprocess, April 30(Click to select)Purchasesduring AprilLess: Work-inprocess, April30Manufacturing overheadappliedInventory, April 1Add:Work-in-process, April 1Total manufacturing costs,April(Click to select)Add: Workin-process, April 1Less:Inventory, April 30Inventory,April 1Purchases duringAprilLess: Work-in-process,April 1(Click to select)Less:Inventory, April 30Inventory,April 1Add: Work-in-process,April 30Less: Work-inprocess, April 30Purchasesduring AprilCost of goodsmanufactured, April$$(Calculate the average cost per unit of product manufactured. (Round your answer to 2 decimalbplaces. 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. Roundyour answer to the nearest dollar amount. Omit the "$" sign in your response.)Cost of goodssold$Requirement 3:(Calculate the difference between cost of goods manufactured and cost of goods sold. (Do not rounda 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 ondifference between cost of goods manufactured and cost of goods sold is in the work in progress account on the balance sheet.The differgoods 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. Assumethat sales for the month were $284,500 and the company's effective income tax rate was 40%. (Amountsto be deducted should be indicated with minus sign. Do not round your intermediate calculations.Round your answer to the nearest dollar amount. Omit the "$" sign in your response.)BigThunder Co.Absorption Income StatementFor the month of April(Click to select)Interest expenseCostof goods soldSelling andadministrative expensesIncome taxexpenseSales(Click to select)Cost of goodssoldIncome tax expenseSalesSellingand administrative expensesInterestexpense(Click to select)Gross profitGrossloss(Click to select)Selling andadministrative expensesInterestexpenseWages payableAdvertisingexpensesIncome tax expense(Click to select)Operating$$$lossOperating income(Click to select)AdvertisingexpensesUnearned revenueInterestexpenseSelling and administrativeexpensesWages expenses(Click to select)AdvertisingexpensesWages expensesIncomebefore taxesUnearned revenueSellingand administrative expenses(Click to select)Income taxexpenseSelling and administrativeexpensesWages expensesUnearnedrevenueAdvertising expenses(Click to select)Net lossNet income$$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 designedusing an activity-based costing approach. Direct materials and direct labor costs are accumulatedseparately, 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. Thefollowing information was available for 2010, based on an expected production level of 53,500 units forthe year, which will require 218,000 direct labor hours:Activity(CostDriver)CostDriverBudgetedUsedCosts foras2010AllocationBaseMaterialshandlingCuttingand latheworkAssembly andinspection$261,6001,700,4004,578,000CostAllocation RateNumberof partsusedNumberof partsused$per part1.45per part21.00Directlaborhours0.28per hourThe following production, costs, and activities occurred during the month of March:UnitsProduced3,250DirectMaterials Costs$111,600Numberof Parts Used43,756DirectLabor Hours14,000Required:(Calculate the total manufacturing costs and the cost per unit of the windows produced during thea month of March (using the activity-based costing approach). (Round "cost per unit produced" to 2) decimal places and the rest to the nearest dollar amount. Omit the "$" sign in your response.)Total manufacturingcostCost per unitproduced$$(Assume instead that Galvaset Industries applies manufacturing overhead on a direct labor hours basisb (rather than using the activity-based costing system previously described). Calculate the total) manufacturing cost and the cost per unit of the windows produced during the month of March. (Hint:You will need to calculate the predetermined overhead application rate using the total budgetedoverhead costs for 2010.) (Do not round your intermediate calculations. Round "cost per unitproduced" to 2 decimal places and the rest to the nearest dollar amount. Omit the "$" sign inyour response.)Total manufacturingcostCost per unitproduced$$(Which approach do you think provides better information for manufacturing managers?c)(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 Aprilincluded $29,500 of fixed manufacturing overhead. The total absorption cost per calculator was $9.5.Required:(Calculate the variable cost per calculator. (Do not round your intermediate calculations. Roundayour answer to 2 decimal places. Omit the "$" sign in your response.))Variable cost per calculator$(The ending inventory of pocket calculators was 900 units higher at the end of the month than at theb beginning of the month. By how much and in what direction (higher or lower) would operating income) for the month of April be different under variable costing than under absorption costing? (Do notround your intermediate calculations. Omit the "$" sign in your response.)Operating income under variable costing will be $, (Click to select)higherlower thanunder absorption costing.(Express the pocket calculator cost in a cost formula. (Do not round your intermediate calculations.cRound your answers to 2 decimal places. Omit the "$" 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 havebeen assembled:The company sells a single product at a price of $50 per unit. The estimated sales volume for the nextsix months is as follows:SeptemberOctoberNovemberDecemberJanuaryFebruary11,700 units10,800 units12,600 units18,000 units8,100 units9,000 unitsAll sales are on account. The company's collection experience has been that 30% of a month's salesare collected in the month of sale, 68% are collected in the month following the sale, and 2% areuncollectible. It is expected that the net realizable value of accounts receivable (i.e., accountsreceivable 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 expectedto be 3,240 units.To make one unit of finished product, 4 pounds of materials are required. Management's policy is tohave enough materials on hand at the end of each month to equal 40% of the next month's estimatedusage. 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 ofpurchase, the remainder is paid in the following month. The accounts payable for raw materialpurchases is expected to be $68,364 on September 30, 2010.Required:(Prepare a sales budget in units and dollars, by month and in total, for the fourth quarter (October,aNovember, and December) of 2010. (Omit the "$" sign in your response.))OctoberExpected salesin unitsSelling price perunitTotal sales(NovemberDecemberTotal$$$$$$$$Prepare a schedule of cash collections from sales, by month and in total, for the fourth quarter ofb2010. (Omit the "$" sign in your response.))Cash collectionsfrom:September salesOctober salesNovember salesDecember salesOctoberNovemberDecemberTotal$$$$Total cashcollections$$$$(Prepare a production budget in units, by month and in total, for the fourth quarter of 2010. (Amountscto be deducted should be indicated with minus sign.))OctoberBeginninginventory offinished goodsUnits to beproducedGoods availablefor saleNovemberDecemberTotalDesired endinginventory offinishedgoods (30% ofnext month'sbudgeted sales)Quantity of goodssold(Prepare a materials purchases budget in pounds, by month and in total, for the fourth quarter of 2010.d(Amounts to be deducted should be indicated with minus sign.))OctoberBeginninginventory of rawmaterialsPurchases of rawmaterialsRaw materialsavailable for useDesired endinginventory of rawNovemberDecemberTotalmaterials (40%of next month'sestimated usage)Quantity of rawmaterials to beused inproduction(Prepare a schedule of cash payments for materials, by month and in total, for the fourth quarter ofe2010. (Round your answers to the nearest dollar amount. Omit the "$" sign in your response.))Cash payments for:September purchasesOctober purchasesNovember purchasesDecember purchasesTotal cash paymentsOctoberNovemberDecemberTotal$$$$$$$$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 laborhours basis. During November, the first month of the companys fiscal year, $56,460 of manufacturingoverhead was applied to Work in Process Inventory using the predetermined overhead application rate of$7.17 per direct labor hour.rev: 05-11-2011references7.value:1.00 pointsE13-10 Part aRequired:(Calculate the number of hours of direct labor used during November. (Round your answer to nearestawhole number.))Direct labor hoursrev: 05-11-2011check my workeBook Links (2)references8.value:1.00 pointsE13-10 Part b(Actual manufacturing overhead costs incurred during November totaled $45,930. Calculate theb amount of over- or underapplied overhead for November. (Input the amount as positive value. Omit) the "$" sign in your response.)(Click to select)OverappliedoverheadUnderapplied overheadrev: 05-11-2011check my workeBook Links (2)references

 

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