The Devon Motor Company produces automobiles. On April 1, the company had no beginning inventories, and it purchased 8,000 batteries at a cost of $80 per battery. It withdrew 7,600 batteries from the storeroom during the month. Of these, 100 were used to replace batteries in cars used by the company's traveling sales staff. The remaining 7,500 batteries withdrawn from the storeroom were placed in cars being produced by the company. Of the cars in production during April, 90 percent were completed and transferred from work in process to finished goods. Of the cars completed during the month, 30 percent were unsold at April 30. Required: 1. and 2. Determine the cost of batteries appearing in each of the following accounts on April 30 and select whether each of the accounts would appear on the balance sheet or on the income statement. Name of the Account Raw Materials Work in Process Finished Goods Cost of Goods Sold Selling Expense Cost Appears on:

The Devon Motor Company produces automobiles. On April 1, the company had no beginning inventories, and it purchased 8,000 batteries at a cost of $80 per battery. It withdrew 7,600 batteries from the storeroom during the month. Of these, 100 were used to replace batteries in cars used by the company's traveling sales staff. The remaining 7,500 batteries withdrawn from the storeroom were placed in cars being produced by the company. Of the cars in production during April, 90 percent were completed and transferred from work in process to finished goods. Of the cars completed during the month, 30 percent were unsold at April 30. Required: 1. and 2. Determine the cost of batteries appearing in each of the following accounts on April 30 and select whether each of the accounts would appear on the balance sheet or on the income statement. Name of the Account Raw Materials Work in Process Finished Goods Cost of Goods Sold Selling Expense Cost Appears on:

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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The Devon Motor Company produces automobiles. On April 1, the company had no beginning inventories, and it purchased 8,000 batteries at a cost of $80 per battery. It withdrew 7,600 batteries from the storeroom during the month. Of these, 100 were used to replace batteries in cars being used by the company’s traveling sales staff. The remaining 7,500 batteries withdrawn from the storeroom were placed in cars being produced by the company. Of the cars in production during April, 90 percent were completed and transferred from work in process to finished goods. Of the cars completed during the month, 30 percent were unsold at April 30. Required: 1. Determine the cost of batteries that would appear in each of the following accounts on April 30. Name of the Account Cost 1a. Raw Materials $32,000 1b. Work in Process $60,000 1c. Finished Goods 1d. Cost of Goods Sold 1e. Selling Expense $8,000
The Devon Motor Company produces automobiles. On April 1st the company had no beginning inventories and it purchased 5,410 batteries at a cost of $50 per battery. It withdrew 5,000 batteries from the storeroom during the month. Of these, 100 were used to replace batteries in cars being used by the company's traveling sales staff. The remaining 4,900 batteries withdrawn from the storeroom were placed in cars being produced by the company. Of the cars in production during April, 90 percent were completed and transferred from work in process to finished goods. Of the cars completed during the month, 30 percent were unsold at April 30th. Required: 1. Determine the cost of batteries that would appear in each of the following accounts on April 30th. Name of the Account 1a. Raw Materials 1b. Work in Process 1c. Finished Goods 1d. Cost of Goods Sold 1e. Selling Expense Cost
The Devon Motor Company produces motorcycles. During April, the company purchased 8,000 batteries at a cost of $10 per battery. Devon withdrew 7,600 batteries from the storeroom during the month. Ofthese, 100 were used to replace batteries in motorcycles used by the company’s traveling sales staff. Theremaining 7,500 batteries withdrawn from the storeroom were placed in motorcycles being produced bythe company. Of the motorcycles in production during April, 90% were completed and transferred fromwork in process to finished goods. Of the motorcycles completed during the month, 30% were unsold atApril 30.There were no inventories of any type on April 1.Required:1. Determine the cost of batteries that would appear in each of the following accounts at April 30:a. Raw Materials.b. Work in Process.c. Finished Goods.d. Cost of Goods Sold.e. Selling Expense.2. Specify whether each of the above accounts would appear on the balance sheet or on the incomestatement at April 30.
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Chillicothe Meat Company produces one of the best sausage products in southern Ohio. The company’s controller used the account-classification method to compile the following information.a. Depreciation schedules revealed that monthly depreciation on buildings and equipment is $19,000.b. Inspection of several invoices from meat packers indicated that meat costs the company $1.10 per pound of sausage produced.c. Wage records showed that compensation for production employees costs $.70 per pound of sausage produced.d. Payroll records showed that supervisory salaries total $10,000 per month.e. Utility bills revealed that the company incurs utility costs of $4,000 per month plus $.20 per pound of sausage produced.Required:1. Classify each cost item as variable, fixed, or semivariable.2. Write a cost formula to express the cost behavior of the firm’s production costs. (Use the formula Y = a + bX, where Y denotes production cost and X denotes quantity of sausage produced.)
Orange Electronics (OE) produced 30,000 widgets last month. OE started the month with $50,000 worth of inventory in their Finished Goods. The company incurred $70,000 of various utility and rent charges on their factory, paid $200,000 for raw materials to use in production, and paid employees $50,000 in wages.During the month, inventory costing $300,000 was completed and transferred to the Finished Goods Inventory. At the end of the month, OE had $20,000 of Inventory in Finished Goods, $10,000 in Materials Inventory, and $15,000 still in Work in Process.What was OE’s Cost of Goods Manufactured for the month?
During June, Briganti Corporation purchased $83,000 of raw materials on credit to add to its raw materials inventory. A total of $68,000 of raw materials was requisitioned from the storeroom for use in production. These requisitioned raw materials included $8,000 of indirect materials. Required: Prepare journal entries to record the purchase of materials and their use in production. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet 1 2 Record the purchase of materials. Note: Enter debits before credits. Transaction 1 General Journal Debit Credit
Cold Spring produces premium bottled water. Cold Spring purchases artesian water, stores the water in large tanks, and then runs the water through two processes: filtration and bottling. During February, the filtration process incurred the following costs in processing 190,000 liters: Wages of workers operating the filtration equipment $21,950 Manufacturing overhead allocated to filtration 25,050 Water 150,000 Cold Spring had no beginning inventory in the Filtration Department in February. Compute the February conversion costs in the Filtration Department.
Granger Products recorded the following transactions for the just-completed month. The company had no beginning inventories: a. $75,000 In raw materials was purchased for cash.b. $73,000 in raw materials was requisitioned for use in production. Of this amount, $67,000 was for direct materials and the remainder was for Indirect materials.c. Total wages of $152,000 were incurred and paid. Of this amount, $134,000 was for direct labor and the remainder was for indirect labor.d. Additional manufacturing overhead costs of $126,000 were incurred and paid.e. Manufacturing overhead costs of $178,000 were applied to jobs using the company's predetermined overhead rate.f. All of the jobs in process at the end of the month were completed and shipped to customers.g. If overhead is underapplied in the period, it is closed out to the cost of goods sold. If overhead is overapplied in the period, It is based on the basis of the amount of allocated overhead that is in the ending balances in each…