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Accounting problems

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Question;Problems;Section ?Show all work Questions 1 through 7;Problem;1. The following is a list of various costs of;producing sweatshirts. Classify each cost as either a variable, fixed, or mixed;cost for units produced and sold.;(a);Lubricants used to oil machinery.;(b);Warehouse rent of $6,000 per month;plus $.50 per square foot of storage used.;(c);Thread.;(d);Electricity costs of $.025 per;kilowatt-hour.;(e);Janitorial costs of $2,000 per month.;(f);Advertising costs;of $10,000 per month.;(g);Sales salaries.;(h);Color dyes for producing different;colors of sweatshirts.;(i);Salary of the production supervisor.;(j);Straight-line depreciation on sewing;machines.;(k);Patterns for different designs.;Patterns typically last many years before being replaced.;(l);Hourly wages of;sewing machine operators;(m);Property taxes on factory, building;and equipment.;(n);Cotton and polyester cloth.;(o);Maintenance costs with sewing machine;company. The cost is $2,000 per year plus $.001 for each machine hour of use.;2. On October 31, the end of the first month of;operations, Morristown & Co. prepared the following income statement based;on absorption costing;Morristown;Co.;Income Statement;For Month Ended;October 31, 20-;Sales (2,600 units);$104,000;Cost of goods sold;Cost of goods manufactured;$85,500;Less ending inventory (400 units);11,400;Cost of goods sold;74,100;Gross profit;$ 29,900;Selling and administrative expenses;21,500;Income from operations;$ 8,400;========;If the fixed manufacturing costs were $42,900 and the variable;selling and administrative expenses were $14,600, prepare an income statement;in accordance with the variable costing concept.;3. Based on the following production and sales;data of Shingle Co. for March of the current year, prepare (a) a sales budget;and (b) a production budget.;Product T;Product X;Estimated inventory, March 1;28,000 units;20,000 units;Desired inventory, March 31;32,000 units;15,000 units;Expected sales volume;Area I;320,000 units;260,000 units;Area II;190,000 units;130,000 units;Unit sales price;$6;$14;4. Door & Window Co. was organized on August;1 of the current year. Projected sales for the next three months are as;follows;August;$120,000;September;200,000;October;230,000;The company expects to sell 40% of its merchandise for cash. Of;the sales on account, 25% are expected to be collected in the month of the sale;and the remainder in the following month.;Prepare a schedule indicating total cash collections for August;September, and October.;5. For the current year ending April 30, Hal;Company expects fixed costs of $60,000, a unit variable cost of $70, and a unit;selling price of $105.;(a);Compute the anticipated break-even;sales (units).;(b);Compute the sales (units) required to;realize an operating profit of $8,000.;6. The Filling Department of Rose Petal Lotion;Company had 2,300 ounces in beginning work in process inventory (70% complete).;During the period 46,500 ounces were completed. The ending work in process;inventory was 1,800 ounces (25% complete). What are the equivalent units for;both direct materials and conversion costs (if materials are;added at the beginning of the process)?;7. Give me examples of the following costs for;an automobile manufacturer (fill in the appropriate blanks).;Direct Materials;1.;2.;Direct Labor;1.;Factory Overhead;1. Indirect Materials;2. Indirect Labor;3. Other;Period Costs;1.;2.;Question;1;For which of the following businesses would a process cost system;be appropriate?;An oil refinery;Custom;electronics manufacturer;Yacht builder;Specialty;furniture company;Question;2;Department A had 4,000 units in work in process that were 60%;completed as to labor and overhead at the beginning of the period, 29,000 units;of direct materials were added during the period, 31,000 units were completed;during the period, and 2,000 units were 80% completed as to labor and overhead;at the end of the period. All materials are added at the beginning of the;process. The first-in, first-out method is used to cost inventories.;The number of equivalent units of production for conversion costs;for the period was;33,000;33,800;29,800;30,200;Question;3;Department A had 4,000 units in work in process that were 60%;completed as to labor and overhead at the beginning of the period, 29,000 units;of direct materials were added during the period, 31,000 units were completed;during the period, and 2,000 units were 80% completed as to labor and overhead;at the end of the period. All materials are added at the beginning of the;process. The first-in, first-out method is used to cost inventories.;The number of equivalent units of production for material costs;for the period was;32,000;33,000;29,800;29,000;Question;4;Which of the following costs is an example of a cost that remains;the same in total as the number of units produced changes?;Salary of a factory supervisor;Direct materials;Units of;production depreciation on factory equipment;Direct labor;Question;5;Which of the following describes the behavior of the fixed cost;per unit?;Decreases with;decreasing production;Remains constant;with changes in production;Increases with;increasing production;Decreases with increasing;production;Question;6;If sales are $820,000, variable costs are 58% of sales, and;operating income is $260,000, what is the contribution margin ratio?;62%;42%;53.1%;32%;Question;7;If fixed costs are $250,000, the unit selling price is $125, and;the unit variable costs are $73, what is the break-even sales (units)?;4,808 units;3,425 units;2,000 units;2,381 units;Question;8;If fixed costs are $1,400,000, the unit selling price is $240, and;the unit variable costs are $110, what is the amount of sales required to;realize an operating income of $200,000?;12,308 units;10,769 units;12,000 units;1,538 units;Question;9;If fixed costs are $500,000, the unit selling price is $55, and;the unit variable costs are $30, what is the break-even sales (units) if fixed;costs are increased by $80,000?;25,000 units;23,200 units;10,545 units;19,333 units;Question;10;Which of the following conditions would cause the break-even point;to decrease?;Total fixed costs;increase;Unit selling;price decreases;Unit variable cost decreases;Unit variable;cost increases;Question;11;Which of the following conditions would cause the break-even point;to increase?;Total fixed costs;decrease;Unit selling;price increases;Total fixed costs increase;Unit variable;cost decreases;Question;12;The amount of income under absorption costing will be more than;the amount of income under variable costing when units manufactured;are equal to or;greater than units sold;are less than;units sold;exceed units sold;equal units sold;Question;13;A business operated at 100% of capacity during its first month and;incurred the following costs;Production costs (10,000 units);Direct materials $140,000;Direct labor $40,000;Variable factory overhead $20,000;Fixed factory overhead $4,000;$204,000;Operating expenses;Variable operating expenses $;34,000;Fixed operating expenses 2,000;$36,000;If 2,000 units remain unsold at the end of the month and sales;total $300,000 for the month, what would be the amount of income from;operations reported on the variable costing income statement?;$114,800;$100,800;$100,000 -??????;$140,000;Question;14;A business operated at 100% of capacity during its first month and;incurred the following costs;Production costs (10,000 units);Direct materials $140,000;Direct labor $40,000;Variable factory overhead $20,000;Fixed factory overhead $4,000;$204,000;Operating expenses;Variable operating expenses $;34,000;Fixed operating expenses 2,000;$36,000;If 2,000 units remain unsold at the end of the month and sales;total $300,000 for the month, what is the amount of the manufacturing margin;that would be reported on the variable costing income statement?;$140,000;$106,000;$104,000;$114,800;Question;15.;A business operated at 100% of capacity during its first month and;incurred the following costs;Production costs (5,000 units);Direct materials $70,000;Direct labor $20,000;Variable factory overhead $10,000;Fixed factory overhead $ 2,000;$102,000;Operating expenses;Variable operating expenses $17,000;Fixed operating expenses $1,000;$18,000;If 1,000 units remain unsold at the end of the month and sales;total $150,000 for the month, what is the amount of the contribution margin;that would be reported on the variable costing income statement?;$53,000;$51,400;$54,000;$52,000;Question;16;For March, sales revenue is $1,000,000, sales commissions are 4%;of sales, the sales manager's salary is $80,000, advertising expenses are;$75,000, shipping expenses total 1% of sales, and miscellaneous selling;expenses are $2,100 plus 1% of sales. Total selling expenses for the month of;March are;$187,550;$217,100;$194,100;$192,100;Question;17;Nuthatch Corporation began its operations on September 1 of the;current year. Budgeted sales for the first three months of business are;$260,000, $350,000, and $400,000, respectively, for September, October, and;November. The company expects to sell 30% of its merchandise for cash. Of sales;on account, 80% are expected to be collected in the month of the sale and 20%;in the month following the sale.;The cash collections in October from accounts receivable are;$337,400;$210,000;$232,400;$240,000;Question;18;Finch Company began its operations on March 31 of the current;year. Finch Co. has the following;projected costs;April May June;Manufacturing costs (1) $156,800 $195,200 $217,600;Insurance expense (2) 1,000 1,000 1,000;Depreciation expense 2,000 2,000 2,000;Property tax expense (3) 500 500 500;(1) 3/4 of the;manufacturing costs are paid for in the month they are incurred. 1/4 is paid in the following month.;(2) Insurance expense;is $1,000 a month, however, the insurance is paid four times yearly in the;first month of the quarter, i.e. January, April, July, and October.;(3) Property tax is;paid once a year in November.;The cash payments for Finch Company in the month of April are;$123,100;$120,600;$121,100;$122,600;Question;19;Which of the following is false in regards to direct materials for;an auto manufacturer?;Oil to lubricate;factory machines would not be a direct material.;Upholstery fabric;would probably be a direct material;Steel would;probably be a direct material.;Small plastic clips to hold on;door panels, that become part of the auto, must be accounted for as direct materials.;Question;20;Which of the following is an example of direct labor cost for an;airplane manufacturer?;Cost of jet;engines;Cost of wages of assembly worker;Cost of oil;lubricants for factory machinery;Salary of plant;supervisor;Question;21;Prime costs are;period costs and;factory overhead;direct labor and;factory overhead;direct materials;and factory overhead;direct materials;and direct labor;Question;22;Product costs;are expensed as costs are;incurred for direct labor, direct material and factory overhead;appear on both;the income statement and balance sheet;appear only on;the balance sheet;appear only on;the income statement;Question;23;A plant manager?s salary may be referred to as;an indirect cost;a direct cost;either a direct;cost or an indirect cost since managerial accounting is not restricted by GAAP;a period cost;Question;24;An example of a period cost is;advertising expense;depreciation on;factory equipment;indirect;materials;property taxes

 

Paper#41021 | Written in 18-Jul-2015

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