Faye Co. manufactures a product using 3 kg of raw materials. Production and inventory budgets for June 2016 are as follows: Opening Inventories Closing Inventories Raw materials 11,000 kg 12,400 kg Finished goods 15,150 units 11,400 units Budgeted sales for June amounted to 18,000 units. During the production process, it is usually found that 5% of production units are scrapped as defective and this loss occurs after the raw materials have been placed in process. Required: 2. Assume that the cost of a kilogram of raw material is P16 and that 60% of purchases is paid in the month of purchase while the remaining in the month after the purchase, how much is the cash payment for the June? RS

Faye Co. manufactures a product using 3 kg of raw materials. Production and inventory budgets for June 2016 are as follows: Opening Inventories Closing Inventories Raw materials 11,000 kg 12,400 kg Finished goods 15,150 units 11,400 units Budgeted sales for June amounted to 18,000 units. During the production process, it is usually found that 5% of production units are scrapped as defective and this loss occurs after the raw materials have been placed in process. Required: 2. Assume that the cost of a kilogram of raw material is P16 and that 60% of purchases is paid in the month of purchase while the remaining in the month after the purchase, how much is the cash payment for the June? RS

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

At the beginning of October, Nelson Inc. detemined the following for a particular product: Standard Quantity of material per unit produced 10.0 lbs. Standard Price of material 2.00 per lb. Budgeted Units to be produced 6,000 units The following data pertain to operations concerning the product for October: Actual Cost of materials purchased Beginning Materials Inventory Ending Materials Inventory 150,000 1,500 Ibs. 2,500 lbs. Actual Units Produced 8.000 units Materials Purchase Price Variance $ 15.000 Favorable 17 What was the Materials Quantity Variance for October? $3,000 Unfavorable A. $5,000 Unfavorable $15,000 Unfavorable В. C. D. $27,000 Favorable Е. None of the above
Wynter Company manufactures and sells a single product. Its budgeted production stands at 25 000 units. The following costs were incurred during 2017, the company’s first year of operations. Variable cost per unit Production Direct materials $18 Direct labour 7 Variable manufacturing overhead 2 Fixed costs per year Manufacturing overhead $150 000 Selling and administrative $110 000 During 2017, the company produced 20 000 units and sold 16,000 units. The selling price of the company’s product is $50 per unit Required: a) Compute the number of units in ending inventory.…
Heavy Products, Inc. developed standard costs for direct material and direct labor. In 2017, All estimated the following standard costs for one of their major products, the 10-gallon plastic container. Budgeted quantity. 0.9 pounds Budgeted price $60 per pound Direct materials Direct labor 0.25 hours $20 per hour During June, Heavy Products produced and sold 20,000 containers using 22,000 pounds of direct materials at an average cost per pound of $66 and 18,000 direct manufacturing labor - hours at an average wage of $20.50 per hour. The direct material price variance during June is O A. $372,000 favorable O B. $9,000 favorable O C. $372,000 unfavorable O D. $132,000 unfavorable Next Calculator
Compute Greenspace Company’s gross margin for its first year of operation
Patrick Inc. makes industrial solvents. Budgeted direct labor hours for the first 3 months of the coming year are: January 13,140 February 12,300 March 15,075 The variable overhead rate is $0.70 per direct labor hour. Fixed overhead is budgeted at $2,910 per month. Required: Prepare an overhead budget for the months of January, February, and March, as well as the total for the first quarter. Do not include a multiplication symbol as part of your answer. Round total variable overhead and total overhead to the nearest dollar. Patrick Inc. Overhead Budget For the Coming First Quarter Overhead: January February March Total Total direct labor hrs fill in the blank 1 fill in the blank 2 fill in the blank 3 fill in the blank 4 Variable overhead rate $fill in the blank 5 $fill in the blank 6 $fill in the blank 7 $fill in the blank 8 Total variable overhead $fill in the blank 9 $fill in the blank 10 $fill in the blank 11 $fill in the blank 12 Add: Fixed overhead…
Do not give answer in image
W Corporation assembles handheld computers. Each handheld computer takes six hours to assemble. The following data are for August 2018: Direct materials purchased $2,650,000 Conversion costs incurred $450,000 Direct materials used $2,500,000 Conversion costs allocated $500,000 W records direct materials purchased and conversion costs incurred at actual costs. It has no direct materials variances. When finished goods are sold, the backflush costing system “pulls through” standard direct material cost ($100 per unit) and standard conversion cost ($20 per unit). W produced 25,000 finished units in August 2018 and sold 24,500 units. The actual direct material cost per unit in August 2018 was $100, and the actual conversion cost per unit was $19. Required 1- Assume W uses a JIT production system and a backflush costing system with three trigger points: _ Purchase of direct materials and incurring of conversion costs _ Completion of good finished units of product _ Sale of finished…
5. Lean Accounting Westgate Inc. uses a lean manufacturing strategy to manufacture DVR (digital video recorder) players. The company manufactures DVR players through a single product cell. The budgeted conversion cost for the year is $869,700 for 2,230 production hours. Each unit requires 12 minutes of cell process time. During March, 990 DVR players were manufactured in the cell. The materials cost per unit is $69. The following summary transactions took place during March: Materials were purchased for March production. Conversion costs were applied to production. 990 DVR players were assembled and placed in finished goods. 940 DVR players were sold for $260 per unit. a. Determine the budgeted cell conversion cost per hour. If required, round to the nearest dollar.$fill in the blank c00542f5ffcb016_1 per hour b. Determine the budgeted cell conversion cost per unit. If required, round to the nearest dollar.$fill in the blank c00542f5ffcb016_2 per unit c.…
Smooth Incorporated manufactures hair brushes that sell at wholesale for $2.60 per unit. Budgeted production in both 2021 and 2022 was 4,000 units. There was no beginning inventory in 2021. The following data summarized the 2021 and 2022 operations: 2021 2022 Units sold 3,000 4,200 Units produced 4,000 4,000 Costs: Variable factory overhead per unit $ 0.55 $ 0.65 Fixed factory overhead $ 1,800 $ 1,800 Variable marketing per unit $ 0.75 $ 1.00 Fixed Selling and Administrative $ 650 $ 650 Full costing operating income for 2021 is calculated to be: (Do not round intermediate calculations. Round your final answers to whole dollar amounts.) Multiple Choice $1,450. $1,900. $1,950. $1,521. $1,569.
Writer One Inc. manufactures ball point pens that sell at wholesale for $0.80 per unit. Budgeted production in both 2015 and 2016 was 8,000 units. There was no beginning inventory in 2015. The following data summarized the 2015 and 2016 operations: 2015 2016 Units sold Units produced 9,000 8,000 6,500 8,000 Costs: Variable factory overhead per unit $0.20 $0.20 Fixed factory overhead $1,200 $1,200 Variable marketing per unit Fixed Selling and Administrative $0.30 $0.30 $320 $320 Find variable costing operating income for the year 2015.
None
Content Ltd manufactures and sells monitors and uses standard costing. For the month of May there was no beginning inventory, there were 3,200 units produced and 2,500 units sold. The manufacturing variable cost per unit is $350 and the variable operating cost per unit was $302.50. The actual and fixed manufacturing cost is $420,000 and the fixed operating cost is $85,000. The selling price per unit is $1000. The budgeted units to be produced are 2,800. There are no price-, efficiency-, or spending variances. Any production- volume variance is written off to cost of goods sold in the month in which it occurs. Reconcile the difference in operating income calculated using variable costing and absorption costing. Then explain why there is a difference in the operating profit under the two methods.