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Accounting problems




Question;12-4;Financial Data;Salary of vice president of production;division $180,000;Salary of supervisor Department M 76,000;Salary of supervisor Department N 56,000;Direct materials cost Department M 300,000;Direct materials cost Department N 420,000;Direct labor cost Department M 240,000;Direct labor cost Department N 680,000;Direct utilities cost Department M 120,000;Direct utilities cost Department N 24,000;General factorywide utilities 36,000;Production supplies;36,000;Fringe benefits;138,000;Depreciation;720,000;Nonfinancial;Data;Machine hours department M 5,000;Machine hour?s department N 1,000;A. Identify the costs that are (1) direct;costs of department M, (2) direct costs of department N and (3) indirect costs.;B. Select the appropriate cost drivers for;the indirect costs and allocate these costs to departments M and N.;C. Determine the total estimated cost of;the products made in departments M and N. Assume that Maller produced 2,000;units of products M and 4,000 of prouduct N during the year. If Maller prices;its products M and for N?;12- 15;The Vest school of Vocational Technology;has organized the school training programs;into three departments. Each department provides training in a different area;as follows: nursing assistant, dental hygiene, and office technology. The;schools owner, Candice Vest, wants to know how much it cost to operate each of;the three departments. To accumulate the total cost for each department, the;accountant has identified several indirect costs that must be allocated to;each. These costs are $10,080 of telephone expense, $ 2,016 of supplies;expense, $720,000 of office rent, $144,000 of janitorial services, and $150,000;of salary paid to the dean of students. To provide a reasonably accurate;allocation of costs, the accountant has identified several possible cost;drivers. These drivers and their association with each department follow.;Cost Driver Department;1 Department;2;Department 3;Number of telephones 28;16 19;Numbers of faculty members 20;16;12;Square footage of office space 28,000 16,800;12,000;Number of secretaries 2;2;2;A. Identify the appropriate cost objects.;B. Identify the appropriate cost driver for;each indirect cost and compute the allocation rate for assigning each indirect;cost to the cost objects.;C. determine the amount of telephone;expense that should be allocated to each of the three departments.;D. Determine the amount of office expense;that should be allocated to department 3;F.;Determine the amount of office expense that should be allocated to;department 2.;G. Identify two cost drivers not listed;here that could be used to allocate the cost of the deaths salary to the three;departments.;13- 23;Materials cost ($ 25 per unit X 20,000) $;500,000;Labor cost ($22 per unit X 20,000) $ 440,000;Batch level costs (20 batches at $4,000per;batch) 80,000;Product level cost 160,000;Total cost 1,510,000;Cost per unit = 1, 510,000 / 20,000 =;$75.50;A. Kent Motels has offered to buy a batch;of 500 blankets for $51 each. Ellis normal selling price is $90 per unit. Based;on the preceding quantitative data, should Kent accept the special order? Support;your answer with appropriate computations.;B. Would your answer to requirement a;change if Kent offered to buy a batch of 1,000 blankets for $ 51 per unit? Support;your answer with appropriate computations.;C. Describe the qualitative factors that;Ellis Quilting Company should consider before accepting a special order to sell;blankets to Kent Motels.


Paper#41457 | Written in 18-Jul-2015

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