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Accounting 611 Midterm Exam-Spring 2014




Question;Accounting;611;Midterm;Exam-Spring 2014;Problem;1;Using the following information find the;unknown amounts. Assume each set of information is an independent case.;a. Merchandise Inventory Purchases $210,000;Cost;of goods sold 223,000;Beginning;balance 41,000;Ending;balance?;b. Direct Materials Beginning balance $ 7,000;Ending;balance 14,000;Purchases 48,000;Direct;materials used?;c. Work-in-process Inventory Ending balance $ 22,000;Cost;of goods manufactured 21,000;Beginning;balance 8,000;Current;manufacturing costs?;d. Finished Goods Inventory Cost of goods manufactured $62,000;Ending;balance 20,000;Cost;of goods sold 61,000;Beginning;balance?;Problem 2;Sprint Manufacturing Company produces two;products, X and Y. The following information is presented for both products;X Y;Selling price per unit $30 $20;Variable cost per unit 20 5;Total fixed;costs are $292,500.;Required;a. Calculate the contribution margin for each;product.;b. Calculate breakeven point in units of both X;and Y if the sales mix is 3 units of X for every unit of Y.;c. Calculate breakeven volume in total dollars;if the sales mix is 2 units of X for every 3 units of Y.;Problem 3;Rachel's;Pet Supply Corporation manufactures two models of grooming stations, a standard;and a deluxe model. The following activity and cost information has been;compiled;Number of Number of Number of;Product Setups Components Direct Labor Hours;Standard 3 30 650;Deluxe 7 50 150;Overhead costs $40,000 $120,000;Assume;a traditional costing system applies the $160,000 of overhead costs based on;direct labor hours.;a. What;is the total amount of overhead costs assigned to the standard model?;b. What;is the total amount of overhead costs assigned to the deluxe model?;Assume an activity-based costing system;is used and that the number of setups and the number of components are;identified as the activity-cost drivers for overhead.;c. What;is the total amount of overhead costs assigned to the standard model?;d. What;is the total amount of overhead costs assigned to the deluxe model?;Problem 4;Clothes;Inc., has an average annual demand for red, medium polo shirts of 25,000 units.;The cost of placing an order is $80 and the cost of carrying one unit in;inventory for one year is $25.;Required;a. Use;the economic-order-quantity model to determine the optimal order size.;b. Determine;the reorder point assuming a lead time of 10 days and a work year of 250 days.;c. Determine;the safety stock required to prevent stockouts assuming the maximum lead time;is 20 days and the maximum daily demand is 125 units.;Problem 5;The;following data are available for Ruggles Company for the year ended September;30, 2011.;Sales: 24,000;units at $50 each;Expected and actual production: 30,000 units;Manufacturing costs incurred;Variable: $525,000;Fixed: $372,000;Nonmanufacturing costs incurred;Variable: $144,800;Fixed: $77,400;Beginning inventories: none;Required;a. Determine;operating income using the variable-costing approach.;b. Determine;operating income using the absorption-costing approach.;Problem 6;Jerry's;TV and Appliance Store is a small company that has hired you to perform some;management advisory services. The following information pertains to 2011;operations.;Sales (1,000;televisions) $ 900,000;Cost of goods sold 400,000;Store manager's salary;per year 70,000;Operating costs per year 157,000;Advertising and;promotion per year 15,000;Commissions (4% of;sales) 36,000;Part 1. What was the;variable cost per unit sold for 2011?;A);$36;B);$436;C);$678;D);$400;Part 2What were total;fixed costs for 2011?;A);$678,000;B);$436,000;C);$242,000;D);$227,000;Part 3 What are the;estimated total costs if Penny's expects to sell 3,000 units next year?;A);$1,550,000;B);$1,332,000;C);$1,671,000;D);$1,453,000;Part 4Which cost;estimation method is being used by Jerry's TV and Appliance Store?;A);the industrial engineering method;B);the conference method;C);the account analysis method;D);the quantitative analysis method


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