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ACCT 505 Week 4 Midterm Exam

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Question;1.(TCO A) The following data (in thousands of dollars) have been taken from the accounting records of Larop Corporation for the just-completed year:Sales.................................................................................$910Purchases of raw materials................................................$225Direct labor.......................................................................$245Manufacturing overhead....................................................$265Administrative expenses....................................................$150Selling expenses................................................................$140Raw materials inventory, beginning.....................................$15Raw materials inventory, ending.........................................$45Work-in-process inventory, beginning.................................$20Work-in-process inventory, ending.....................................$55Finished goods inventory, beginning...................................$100Finished goods inventory, ending.......................................$135Required:Prepare a Schedule of Cost of Goods Manufactured in the text box below.(Points: 15) 2.(TCO F) The Illinois Company manufactures a product that goes through three processing departments. Information relating to activity in the first department during June is given below. Percentage Completed Units Materials ConversionWork in process, June 1 150,000 75% 55%Work in process, Jun 30 145,000 85% 75%The department started 475,000 units into production during the month and transferred 480,000 completed units to the next department.Required: Compute the equivalent units of production for the first department for June, assuming that the company uses the weighted-average method of accounting for units and costs.(Points: 20) 3.(TCO B) A tile manufacturer has supplied the following data:Boxes of tile produced and sold 625,000Sales revenue $2,975,000Variable manufacturing expense $1,720,000Fixed manufacturing expense $790,000Variable selling and admin expense $152,000Fixed selling and admin expense $133,000Net operating income $180,000Required:a. Calculate the company's unit contribution margin.b. Calculate the company's unit contribution ratio.c. If the company increases its unit sales volume by 5% without increasing its fixed expenses, what would the company's net operating income be?(Points: 25) 4.(TCO E) Lehne Company, which has only one product, has provided the following data concerning its most recent month of operations:Selling price $ 125Units in beginning inventory600Units oroduced3000Units sold3500Units in ending inventory100Variable costs per unit:Direct materials $ 15Direct labor $ 50Variable manufacturing overhead $ 8Variable selling and admin $ 12Fixed costs:Fixed manufacturing overhead $ 75,000Fixed selling and admin $ 20,000The company produces the same number of units every month, although the sales in units vary from month to month. The company's variable costs per unit and total fixed costs have been constant from month to month.Required:a. What is the unit product cost for the month under variable costing?b. What is the unit product cost for the month under absorption costing?c. Prepare an income statement for the month using the variable costing method.d. Prepare an income statement for the month using the absorption costing method.(Points: 30)

 

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