Alameda Manufacturing manufactures a variety of wooden picture frames using recycled wood from old barns. Alam Manufacturing has reported the following costs for the previous year. Assume no production inventories. Advertising Cost of hardware (hangers, decorations, etc) Cost of wood Depreciation on production equipnent Tactory property taxes Factory rent $ 25,100 $ 43,600 $122,000 $33,600 $ 15,700 $ 48,400 $ 3,120 $ 40,200 $ 42,800 $26,500 $ 33,500 S 87,600 $ 73,900 Glue Production supervisor salary Sales manager salary Utilities for actory Mages for maintenance vorkers Mages of asenbly workera Wages of tinishing vorkers a. Compute the direct material costs. Direct Material Costs b. Compute the direct labor cost. Drect Laber Cost

Alameda Manufacturing manufactures a variety of wooden picture frames using recycled wood from old barns. Alam Manufacturing has reported the following costs for the previous year. Assume no production inventories. Advertising Cost of hardware (hangers, decorations, etc) Cost of wood Depreciation on production equipnent Tactory property taxes Factory rent $ 25,100 $ 43,600 $122,000 $33,600 $ 15,700 $ 48,400 $ 3,120 $ 40,200 $ 42,800 $26,500 $ 33,500 S 87,600 $ 73,900 Glue Production supervisor salary Sales manager salary Utilities for actory Mages for maintenance vorkers Mages of asenbly workera Wages of tinishing vorkers a. Compute the direct material costs. Direct Material Costs b. Compute the direct labor cost. Drect Laber Cost

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Crystal Displays Inc. recently began production of a new product, flat panel displays, which required the investment of $1,500,000 in assets. The costs of producing and selling 5,000 units of flat panel displays are estimated as follows: Question not attempted. 1 Variable costs per unit: 2 Direct materials $120.00 3 Direct labor 30.00 4 Factory overhead 50.00 5 Selling and administrative expenses 35.00 6 Total $235.00 7 Fixed costs: 8 Factory overhead $250,000.00 9 Selling and administrative expenses 150,000.00 Crystal Displays Inc. is currently considering establishing a selling price for flat panel displays. The president of Crystal Displays has decided to use the cost-plus approach to product pricing and has indicated that the displays must earn a 15% rate of return on invested assets. Required: 1. Determine the amount of desired profit from the production and sale of flat panel displays. 2.…
Mariposa Manufacturing builds custom wooden cabinets, Mariposa Manufacturing has reported the following costs for the previous year. Assume no production inventories. Advertising: $70,000 Cost of hardware (slides, handles, etc.): $34,000 Cost of wood: $117,000 Depreciation on production equipment: $63,000 Factory property taxes: $17,300 Factory rent: $76,000 Glue: $3,800 Production supervisor salary: $40,700 Sales manager salary: $41,600 Utilities for factory: $23,900 Wages for maintenance workers: $31,800 Wages of assembly workers: $91,400 Wages of finishing workers: $77,300 Compute the manufacturing overhead and total manufacturing cost
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Charles Berkle is the manager of Nogain Manufacturing and is interested in doing a cost of quality analysis. The following cost and revenue data are available for the most recent year ended December 31: Sales revenue Cost of goods sold Warranty expense Inspection costs Scrap and rework Product returns due to defects Depreciation expense Machine maintenance expense Wage expense Machine breakdown costs Estimated lost sales due to poor quality $ 250,000 140,000 22,000 14,000 7,800 6,000 10,000 3,400 35,000 4,000 5,000 Required: a. Classify each of these costs into the four quality cost categories and prepare a cost of quality report for Nogain. b. What percentage of sales revenue is being spent on prevention and appraisal activities? c. What percentage of sales revenue is being spent on internal and external failure costs?
17. Calculate the prime costs and conversion costs if a company incurs the following to produce wine glasses: $4,000 for molten glass, $15,000 paid to employees who create the glasses, and $2,000 paid to employees who repair equipment used in the production facilities. 28. As of January 1, 20Y5, Tippy Cup Co. had a balance of $15,000 for raw materials inventory. The company's ending balance of raw materials inventory totaled $13,900. Every four months, the company purchases 250 pounds of raw materials at $25 a pound. Calculate the cost of direct materials used for the year. 29. Tippy Cup Co. also incurred $10,550 for factory overhead and 250 hours of direct labor at $10.30 per hour. Using the cost of direct materials used calculated in Exercise 28, determine the total manufacturing costs incurred for the year.
Harold Manufacturing produces denim clothing. This year, it produced 5,280 denim jackets at a manufacturing cost of $41.00 each. These jackets were damaged in the warehouse during storage. Management investigated the matter and identified three alternatives for these jackets. 1. Jackets can be sold to a secondhand clothing shop for $7.00 each. 2. Jackets can be disassembled at a cost of $32,800 and sold to a recycler for $11.00 each. 3. Jackets can be reworked and turned into good jackets. However, with the damage, management estimates it will be able to assemble the good parts of the 5,280 jackets into only 3,050 jackets. The remaining pieces of fabric will be discarded. The cost of reworking the jackets will be $101,400, but the jackets can then be sold for their regular price of $41.00 each. Required: 1. Calculate the incremental income. Incremental revenue Incremental costs Incremental income Alternative 1 Sell to a second- hand shop Alternative 2 Disassemble and sell to a recycler…
U-RIDE, Incorporated currently produces the electric engines that are used in golf carts made and sold by the Company. Electco has offered to sell the electric engines to U-RIDE at a price of $291 each. Current production information follows: Unit-level material and labor $240 Facility-level depreciation of manufacturing equipment Product-level engine production supervisor's salary $6,300 /month $3,300 /month $21,500 Annual facility-level utilities U-RIDE is currently operating profitably producing and selling 3,300 engines a year using 80% of its manufacturing capacity. Which of the following is true? Multiple Choice O O U-RIDE should make the engines for cost savings of $51 per unit. Buying the units would increase U-RIDE's cost by $39 per unit. U-RIDE has avoidable costs of greater than $291 per unit and should therefore buy the engines. Buying the units would increase profitability by $90 per unit.
Piper Recreational Vehicles (PRV) modifies vans into recreational vehicles. PRV offers two models, the XC-2 and XC-6, which differ in the quality of the basic van and the workmanship and machining detail that are used. The following data reflect expected operations for the next year. Number assembled Materials cost per RV Other costs: Direct labor Depreciation Miscellaneous costs XC-2 54 $ 40,000 XC-6 Operation cost Materials cost Total cost Unit cost 39 $ 70,000 Total 93 $ 905,550 735, 120 633, 180 Required: Piper Recreational Vehicles uses operations costing and assigns conversion costs based on the number of units assembled. Compute the expected cost of each model assembled next year. X Answer is complete but not entirely correct. XC-2 XC-6 $ 1,320,408X $ 2,160,000 $ 3,480,408X $ 3,683,428X $ 64,452 X $ 94,448 X Total 953,428X $ 2,273,836 2,730,000
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