Details of this Paper

ACT 5733 ? Advanced Managerial Accounting




Question;ACT 5733 ? Advanced Managerial AccountingWinter 2014HW #2Directions: Answer all the questions. Please submit your work in Word or PDF formats only. You can submit an Excel file to support calculations, but please ?cut and paste? your solutions into the Word or PDF file. Be sure to show how you did your calculations. Also, please be sure to include your name at the top of the first page of your file. Question #1Consider the following information:Q1 Q2 Q3Beginning inventory (units) 0 300 300Actual units produced 1,000 800 1,250Budgeted units to be produced 1,000 1,000 1,000Units sold 700 800 1,500Manufacturing costs per unit produced $900 $900 $900Marketing costs per unit sold $600 $600 $600Fixed manufacturing costs $400,000 $400,000 $400,000Fixed marketing costs $140,000 $140,000 $140,000Selling price per unit $2,500 $2,500 $2,500There are no price, efficiency, or spending variances, and any production-volume variance is directly written off to cost of goods in the quarter in which it occurs.a) Prepare income statements for Q1, Q2, and Q3 using variable costing and absorption costing.b) Explain the differences in operating income between the two costing systems for each quarter. Be specific!Question #2a) Under which inventory costing method would managers have an incentive to build excess inventory? Be sure to justify your answer.b) What can a manager do to reduce the incentive to build excess inventory? Be specific!Question #3a) What role does the choice of capacity level (denominator level) impact income reported under variable costing? Be specific!b) What role does the choice of capacity level (denominator level) impact income reported under full absorption costing? Be specific!Question #4A firm expects to sell 10,000 units of its product annually. It estimates that it costs $200 to place an order and that each unit costs $7 annually to carry in inventory. It takes 7 days to receive an order once it is placed, and the store is open 365 days per year.a) How many units should the firm order at a time if it wants to minimize the sum of ordering and carrying costs?b) How many orders will it place in a year?c) What will its average inventory level be during the year?d) What is its reorder point?Question #5If a firm decides to implement a JIT inventory system, list, describe, and justify five metrics (measures) that the firm should begin tracking to assess the JIT system.


Paper#43999 | Written in 18-Jul-2015

Price : $25