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Given the following costs for Bently Company, classify each cost as either variable




Question;A) Given the following costs for Bently Company, classify each cost as either variable, fixed, ormixed.Total Cost at2,000 Units3,000 UnitsCost A$12,900$19,350Cost B12,30016,650Cost C13,00013,000B) Robey Inc. manufactures two products, Extra and Basic. Overhead costs consist of setting upmachines, $200,000, machining, $450,000, and inspecting, $150,000. Additional information onthe two products is:ExtraBasicTotalDirect labor hours15,00025,00040,000Machine setups6004001,000Machine hours24,00026,00050,000Inspections8007001,500Show Computationsi) Determine the overhead applied to Extra using traditional costing based on direct labor hoursii) Determine the overhead applied to Extra using activity based costingiii) Does it appear activity based costing would be worthwhile in this case? Why?Hose Inc. is preparing its budget for the coming year, 2014. The first step is to plan for the first quarter of that coming year. Hose gathered the following information from the managers.SalesUnit sales for November 2013Unit sales for December 2013Expected unit sales for January 2014Expected unit sales for February 2014Expected unit sales for March 2014Expected unit sales for April 2014Expected unit sales for May 2014Unit selling price per hose112,500102,083113,333112,500116,667125,000137,500$12Hose likes to keep 10% of the next month?s unit sales in ending inventory. All sales are on account.85% of the Accounts Receivable are collected in the month of sale, and15% of the Accounts Receivable are collected in the month after sale.Accounts receivable on December 31, 2013, totaled $183,750.Direct MaterialsItem__PlasticRubberAmount used per unit12 oz @ 6? per oz4 oz @ 5? per ozInventory, Dec. 31,20133,883.125 lbs1,294.375 lbsHose likes to keep 5% of the materials needed for the next month in its ending inventory.materials is made within 15 days.50% is paid in the month of purchase, and50% is paid in the month after purchase.Accounts Payable on December 31, 2013, totaled $120,595.Payment forDirect LaborLabor requires 12 minutes per unit for completion and is paid at a rate of $10 per hour.Manufacturing OverheadIndirect materialsUtilitiesSalariesDepreciationProperty taxesJanitorial30? per labor hour45? per labor hour$42,000 per month$16,800 per month$2,500 per month$1,300 per monthSelling and AdministrativeVariable selling and administrative cost per unit is $1.62.AdvertisingSalariesDepreciation$15,000 a month$72,000 a month$2,500 a monthOther InformationThe Cash balance on December 31, 2013, totaled $100,500, but management has decided it would liketo maintain a cash balance of at least $150,000 beginning on January 1, 2014.Dividends are paid each month at the rate of $2.50 per share for 5,000 shares outstanding. The company has an open line of credit with Last National Bank. The terms of the agreement requires borrowing to be in $1,000 increments at 8% interest.Hose borrows on the first day of the month and repays on the last day of the month.A $500,000 equipment purchase is planned for February.Required:Prepare the following for January 2014:a)Sales budget.b)Production budget.c)Direct materials budget.d)Direct labor budget.e)Manufacturing overhead budgetf)Selling and administrative budget.g)Expected cash collections from customers.h)Expected payments for materials purchases.i)Cash budget.


Paper#40981 | Written in 18-Jul-2015

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