Kimmel, Accounting, 7eUS Help | System AnnouncementsCALCULATORPRINTER VERSION1 BACKNEXTProblem 21-02ALovell Computer Parts Inc. is in the process of setting a selling price on anew component it has just designed and developed. The following costestimates for this new component have been provided by the accountingdepartment for a budgeted volume of 45,000 units.PerTotalUnitDirect materials$49Direct labor$22Variable manufacturing overhead$23Fixed manufacturing overhead$540,000Variable selling and administrative expenses$22Fixed selling and administrative expenses$405,000Lovell Computer Parts management requests that the total cost per unit beused in cost-plus pricing its products. On this particular product,management also directs that the target price be set to provide a 18%return on investment (ROI) on invested assets of $1,000,000.Compute the markup percentage and target selling price that will allowLovell Computer Parts to earn its desired ROI of 18% on this newcomponent. (Round markup percentage to 2 decimal places, e.g.10.50%.)Markup percentage%MacBook Kimmel, Accounting, 7eHelp | System AnnouncementsCALCULATORPRINTER VERSION1 BACKNEXTCompute the markup percentage and target selling price that will allowLovell Computer Parts to earn its desired ROI of 18% on this newcomponent. (Round markup percentage to 2 decimal places, e.g.10.50%.)Markup percentage0%Target selling priceAssuming that the volume is 36,000 units, compute the markup percentageand target selling price that will allow Lovell Computer Parts to earn itsdesired ROI of 18% on this new component. (Round answers to 2decimal places, e.g. 10.50% or 10.50.)%Markup percentageTarget selling price24Click if you would like to Show Work for thisquestion:Open ShowWorkSAVE FOR LATERSUBMIT ANSWERQuestion Attempts: 0 of 1 usedMacBook

Name: Kimmel, Accounting, 7eUS Help | System AnnouncementsCALCULATORPRINTER
Uploaded: 2024-03-20T06:33:06.000Z
Channel: Bartleby
Description: Kimmel, Accounting, 7eUS Help | System AnnouncementsCALCULATORPRINTER VERSION1 BACKNEXTProblem 21-02ALovell Computer Parts Inc. is in the process of setting a selling price on anew component it has just designed and developed. The following costesti

Total cost includes both variable and fixed costs involved.

Business

Accounting

Lovell Computer Parts Inc. Is in the process of setting a selling price on a new component it has just designed and developed. The following cost estimates for this new component have been provided by the accounting department for a budgeted volume of 45,000 units. Per Unit Total Direct materials $49 Direct labor $22 Variable manufacturing overhead $23 Fixed manufacturing overhead $540,000 Variable selling and administrative expenses $22 Fixed selling and administrative expenses $405,000 Lovell Computer Parts management requests that the total cost per unit be used in cost-plus pricing its products. On this particular product, management also directs that the target price be set to provide a 18% return on investment (ROI) on invested assets of $1,000,000.

Lovell Computer Parts Inc. Is in the process of setting a selling price on a new component it has just designed and developed. The following cost estimates for this new component have been provided by the accounting department for a budgeted volume of 45,000 units. Per Unit Total Direct materials $49 Direct labor $22 Variable manufacturing overhead $23 Fixed manufacturing overhead $540,000 Variable selling and administrative expenses $22 Fixed selling and administrative expenses $405,000 Lovell Computer Parts management requests that the total cost per unit be used in cost-plus pricing its products. On this particular product, management also directs that the target price be set to provide a 18% return on investment (ROI) on invested assets of $1,000,000.

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

Pinnacle Corp. budgeted $226,430 of overhead cost for the current year. Actual overhead costs for the year were $213,870. Pinnacle's plantwide allocation base, machine hours, was budgeted at 51,960 hours. Actual machine hours were 53,550. A total of 102,150 units was budgeted to be produced and 98,000 units were actually produced. Pinnacle's plantwide factory overhead rate for the current year is: Oa. $4.12 per machine hour Ob. $4.36 per machine hour Oc. $2.22 per machine hour Od. $2.09 per machine hour
Eilers Company has two producing departments and two support departments. The following budgeted data pertain to these four departments: Support Departments Producing Departments Assembly Finishing $47,000 $70,000 4,600 1,350 43,000 General Factory Receiving $470,000 $190,000 Direct overhead Square footage. Number of receiving orders 2,000 Direct labor hours. 22,000 The company has decided to simplify its method of allocating support service costs by switching to the direct method. Allocation ratios: 300 2,300 4,600 Required: 1. Allocate the costs of the support departments to the producing departments using the direct method. Round allocation ratios to four significant digits. Round allocated costs to the nearest dollar. Use the rounded values for subsequent calculations.
Jamison Company has two service departments and two producing departments. Square footage of space occupied by each department follows: Custodial services 2,700 feet General administration 4,700 feet Producing Department A 9,700 feet Producing Department B 9,700 feet 26,800 feet The department costs of Custodial Services are allocated on a basis of square footage of space. If Custodial Services costs are budgeted at $55,000, the amount of cost allocated to General Administration under the direct method would be:
Patel and Sons Inc. uses a standard cost system to apply factory overhead costs to units produced. Practical capacity for the plant is defined as 51,600 machine hours per year, which represents 25,800 units of output. Annual budgeted fixed factory overhead costs are $258,000 and the budgeted variable factory overhead cost rate is $2.50 per unit. Factory overhead costs are applied on the basis of standard machine hours allowed for units produced. Budgeted and actual output for the year was 19,500 units, which took 40,600 machine hours. Actual fixed factory overhead costs for the year amounted to $251,600 while the actual variable overhead cost per unit was $2.40. Assume that at the end of the year, management of Patel and Sons decides that the overhead cost variances should be allocated to WIP Inventory, Finished Goods Inventory, and Cost of Goods Sold (CGS) using the following percentages: 10%, 20%, and 70%, respectively. Provide the proper journal entry to close out the…
Moira Company has just finished its first year of operations and must decide which method to use for adjusting cost of goods sold. Because the company used a budgeted indirect cost rate for its manufacturing operations, the amount that was allocated ($435,000) to cost of goods sold was different from the actual amount incurred ($425,000). Ending balances in the relevant accounts were: Work in Process $ 40,000 Finished Goods 80,000 Cost of Goods Sold 680,000 Required 1. Prepare a journal entry to write off the difference between allocated and actual overhead directly to Cost of Goods Sold Be sure your entry closes the related overhead accounts. 2. Prepart a journal entry that prorates the write-off of the difference between allocated and actual overhead using ending account balances. Be sure your journal entry closes the related overhead accounts.
16) sector companies purchase materials and components and conve goods. A) Merchandising B) Service C) Manufacturing D) Professional
Tiger Equipment Inc., a manufacturer of construction equipment, prepared the following factory overhead cost budget for the Welding Department for May of the current year. The company expected to operate the department at 100% of normal capacity of 6,200 hours. Variable costs: Indirect factory wages $20,460 Power and light 13,826 Indirect materials 11,346 Total variable cost $45,632 Fixed costs: Supervisory salaries $10,410 Depreciation of plant and equipment 26,700 Insurance and property taxes 8,150 Total fixed cost 45,260 Total factory overhead cost $90,892 During May, the department operated at 6,600 standard hours. The factory overhead costs incurred were indirect factory wages, $22,000; power and light, $14,450; indirect materials, $12,300; supervisory salaries, $10,410; depreciation of plant and equipment, $26,700; and insurance and property taxes, $8,150. Required: Prepare a factory overhead cost…
Dog
Don Johnson is the management accountant for Cari-Blocks (CB), which manufactures specialty blocks. CB uses two direct cost categories: direct materials and direct manufacturing labour. Johnson feels that manufacturing overhead is most closely related to material usage. Therefore, CB allocates manufacturing overhead to production based upon pounds of materials used. At the beginning of 2021, CB budgeted annual production of 200,000 blocks and adopted the following standards for each block: Input Cost/Block Direct materials 0.5 Ib. @ $12/lb. $ 6.00 Direct manufacturing labour 1.4 hours @ $20/hour 28.00 Manufacturing overhead: Variable $6/lb. 0.5 Ib. 3.00 Fixed $15/lb. 0.3 Ib. 4.50 Standard cost per block $41.50 Actual results for April 2021 were as follows: Production 24,000 blocks Direct materials purchased 12,000 lb. at $13/lb. Direct materials used 11,450 lb. Direct manufacturing labour 38,000 hours for $798000 Variable manufacturing overhead $68,150 Fixed manufacturing overhead…
Company 10, a local road building contractor, had budgeted indirect costs for 2023 of $600,000. Budgeted labour hours for the year were 12,500 costing $260,000 and budgeted machine hours were 14,000. The company marks-up the total cost of each job by 40% to determine selling price. The company has just completed a road repair for the local council. The direct costs were as follows: Materials: $32,100 Labour: 305 hours Machining: 75 hours What is the total selling price of this job assuming the company allocates overheads on: A labour hour basis? A machine hour basis? (1) (ii) A B C D (1) Labour hour basis $53,084 $74,318 $65,436 $20,496 (ii)Machine hour basis $41,659 $58,323 $49,441 $4,521
Lovell Computer Parts Inc. is in the process of setting a selling price on a new component it has just designed and developed. The following cost estimates for this new component have been provided by the accounting department for a budgeted volume of 50,000 units. Per Unit Total Direct materials $50 Direct labor 26 Variable manufacturing overhead 20 Fixed manufacturing overhead $600,000 Variable selling and administrative expenses 19 Fixed selling and administrative expenses 400,000 Lovell Computer Parts management requests that the total unit cost be used in cost-plus pricing its products. On this particular product, management also directs that the target price be set to provide a 25% return on investment (ROI) on invested assets of $1,000,000. Instructions (Round all calculations to two decimal places.) Compute the markup percentage and target selling price that will allow Lovell Computer Parts to earn its desired ROI of 25% on this new component. Assuming that the volume is 40,000…
Maira Corporation has set various goals and the management is taking various appropriate actions to ensure the company achieves these goals. One of the actions is to reduce operational costs, which exceeds budgeted amount. Which of the following functions best describes this process? A. Decision-making B. Planning C. Directing operational activities D. Controlling 2. HOC Company's costs for the month of June 2021 were as follows: direct materials, RM25,000; direct labor, RM32,500; selling, RM16,000; administrative, RM15,500; and manufacturing overhead, RM44,400. The beginning work in process inventory was RM17,000 and the ending work in process inventory was RM7,000. What was the cost of goods manufactured for the month? (a) RM105,000 (b) RM31,500 (c) RM133,400 (d) RM111,900 3. Chery Company manufactures and sells washing machines. In order to make assembly of the machines faster and easier, some of the metal parts in the machines are coated with grease. How should the cost of…