Versatile Electrics manufactures electrical instruments for a variety of purposes. The following coste, related to maintaining product quality, were incurred in May: Inspection of electrical components purchased from outside suppliers $24 000 Costs of rework on faulty instruments 38 000 Replacement of instruments already sold that were still covered by warranty 85 000 Costs of defective parts that cannot be salvaged 12 200 Training of quality control inspectors 10 000 Tests of instruments before sales 20 000 Required: 1. Prepare a cost of quality report similar to the report chown in Exhibit 16.11. 2. How do you think management should react to the relative size of the four categories of quality costs? think that Vor vninin

Versatile Electrics manufactures electrical instruments for a variety of purposes. The following coste, related to maintaining product quality, were incurred in May: Inspection of electrical components purchased from outside suppliers $24 000 Costs of rework on faulty instruments 38 000 Replacement of instruments already sold that were still covered by warranty 85 000 Costs of defective parts that cannot be salvaged 12 200 Training of quality control inspectors 10 000 Tests of instruments before sales 20 000 Required: 1. Prepare a cost of quality report similar to the report chown in Exhibit 16.11. 2. How do you think management should react to the relative size of the four categories of quality costs? think that Vor vninin

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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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
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…
GYM Machine Shop manufactures jacks equipment. One order comes from Muscle, Inc. for 2,000 jacks, which showed the following costs per unit: Materials $40.00 Labor $17.50 FOH is 160% of direct labor cost (with 10% allowance for reworking defective units) Final inspection revealed that 150 of the jacks were not properly produced. Correction of each unit requires 2.00 for materials, 3.00 for labor and factory overhead at an appropriate rate. 1. If defect is the result of internal failure, what is the cost of each unit of jacks produced? a. $78.27b. $85.50c. $80.39d. $84.46 2. If defect is the result of change in specifications imposed by the customers, what is the cost of each unit of jacks produced? a. $78.27b. $85.50c. $80.39d. $84.46
Catriona Company completed 300 units of customized jewelry. The product cost per unit: Direct materials P8,400 Direct labor 500 Factory overhead 750 P9,650 However, upon quality inspection, 20 units were found to be spoiled. The spoiled goods are sold for P138,400. The spoilage is due to customer's preferences. All good items and spoiled items are sold. How much is the product cost per unit?
Selected T - accounts of Moore Company are given below for the just completed year: Raw Materials Debit Credit Balance 1/1 33,000 Credits ? question mark Debits 156,000 Balance 12/31 43,000 Manufacturing Overhead Debit Credit Debits 186,200 Credits ? question mark Work in Process Debit Credit Balance 1/1 38,000 Credits 524,000 Direct materials 108,000 Direct labor 204,000 Overhead 214, 200 Balance 12/31 ? question mark Factory Wages Payable Debit Credit Debits 221,000 Balance 1/1 18,000 Credits 216,000 Balance 12/31 13,000 Finished Goods Debit Credit Balance 1/1 58,000 Credits ? question mark Debits? question mark Balance 12/31 87,000 Cost of Goods Sold Debit Credit Debits? question mark Required: What was the cost of raw materials used in production? How much of the materials in (1) above consisted of indirect materials? How much of the factory labor cost is indirect labor? What was the cost of goods manufactured? What was the unadjusted cost of goods sold? Do not include any…
Martin Company received an order for 25 automatic mixing machines. Because of the order's exacting specifications, it is anticipated that defective and spoiled work will exceed the normal rate. The materials cost per unit is P80; labor cost, P194; and manufacturing overhead for this order is to be applied at 100% of the labor cost. During production, 5 units were found to be defective and required the following total additional costs: materials, P97, labor, P125, and manufacturing overhead at the 100% rate. On final inspection, 2 units were classified as seconds and sold for P400 each, the proceeds being credited to the order. The purchaser has agreed to accept the 23 machines, although the acceptable units are fewer than the number ordered. What is the unit cost of the completed units? (Round-off to the nearest peso) IN A GOOD ACCOUNTING FORM WILL BE GREAT ALSO!
The company sells firm and extra firm mattresses. We plan to use ABC. The company has accumulated the following data. Activities Cost Cost DriverMaterials processing $1,400,000 Number of partsFirmness testing 400,000Number of testsCustomer calls 200,000 Number of customer calls During the year, 100,000 parts were handled (75,000 for firm mattresses and 25,000 for extra firm), 20,000 firmness tests were conducted (12,500 for firm and 7,500 for extra firm), and 10,000 customers’ calls were answered (7,500 for firm and 2,500 for extra firm) A. Calculate the overhead rates for each activity.B. Calculate the dollar amount of overhead that should be assigned to firm and to extra firm.
Pharoah Corp. received an order for 25 automatic mixing machines. Because of the order's exacting specifications, it is anticipated that defective and spoiled work will exceed the normal rate. The materials cost per unit is P80; labor cost, P194; and manufacturing overhead for this order is to be applied at 100% of the labor cost. During production, 5 units were found to be defective and required the following total additional costs: materials, P97, labor, P125, and manufacturing overhead at the 100% rate. On final inspection, 2 units were classified as seconds and sold for P400 each, the proceeds being credited to the order. The purchaser has agreed to accept the 23 machines, although the acceptable units are fewer than the number ordered. What is the unit cost of the completed units?