Given answer accounting questions Weber Condos Corporation is a small company owned by James Ortiz. Itleases three condos of differing sizes to customers as vacation facilities.Labor costs for each condo consist of maid service and maintenance costs.Other direct operating costs consist of interest and depreciation. The directoperating costs for each condo follow.Other DirectDirect Labor Operating CostsCondo 1 $16,700$41,800Condo 2 19,80043,000Condo 3 26,75061,500Total$63,250$146,300Indirect operating expenses, which amounted to $36,575, are allocated to thecondos in proportion to the amount of other direct operating costs incurredfor each.Assuming that the amount of rent revenue from Condo 2 is $105,000, whatamount of income did it earn?

Step 1: Define Indirect CostsIndirect costs are those incurred costs that cannot be assigned…

Answered: Weber Condos Corporation is a small…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter2: Building Blocks Of Managerial Accounting

Section: Chapter Questions

Problem 4EA: Hicks Contracting collects and analyzes cost data in order to track the cost of installing decks on...

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Patterson Lawn Co. wants to determine the cost of each lawn care maintenance job. The Company has two operating departments, one that performs lawn care services for commercial properties and one that services residential properties. Both operating departments are supported by two service departments, administrative and machine maintenance. Costs for each of these supporting departments are as follows: Administrative Machine Maintenance Total cost $576,000 $3,825,000 The following estimates that are related to the operating departments is as follows: Commercial Residential Total properties properties # of employees 68 60 128 # of customers 225 260 485 # of billable hours 23,000 22,000 45,000 Total overhead cost* $ 525,000 $ 450,000 $ 975,000 *Note that total overhead cost includes costs allocated from service departments and other overhead costs. The Company uses the…
Hicks Contracting collects and analyzes cost data in order to track the cost of installing decks on new home construction jobs. The following are some of the costs that they incur. Classify these costs as fixed or variable costs and as product or period costs. Lumber used to construct decks ($12.00 per square foot) Carpenter labor used to construct decks ($10 per hour) Construction supervisor salary ($45,000 per year) Depreciation on tools and equipment ($6,000 per year) Selling and administrative expenses ($35,000 per year) Rent on corporate office space ($34,000 per year) Nails, glue, and other materials required to construct deck (varies per job)
Matt Simpson owns and operates Quality Craft Rentals, which offers canoe rentals and shuttle service on the Nantahala River. Customers can rent canoes at one station, enter the river there, and exit at one of two designated locations to catch a shuttle that returns them to their vehicles at the station they entered. Following are the costs involved in providing this service each year: Variable Fixed Costs Costs $ 3,100 3,800 6,200 7,720 6,800 21,800 Canoe maintenance $ 9.00 Licenses and permits Vehicle leases Station lease Advertising Operating costs 7.00 7.00 Quality Craft Rentals began business with a $27,000 expenditure for a fleet of 30 canoes. These are expected to last 10 more years, at which time a new fleet must be purchased. Rentals have been stable at about 6,800 per year. Required: Matt is happy with the steady rental average of 6,800 per year. For this number of rentals, what price should he charge per rental for the business to make an annual 16% before-tax return on…
Understanding the assignment manufactures computer chips. It incurs the following costs in manufacturing chips and in operating the sts is mpora. sider a company that company. 1. Plastic board used to mount the chip, $3.50 each. 2. Assembly worker pay of $15 per hour to attach chips to plastic board. 3. Salary for factory maintenance workers who maintain factory equipment. 4. Factory supervisor pay of $55,000 per year to supervise employees. 5. Salary paid to the chief financial officer, $95,000. 6. Advertising costs of $7,800 paid to promote ploducts. 7. Salespersons' commissions of S0.50 for each assembled chip sold. 8. Management has the option to rent the manufacturing plant to six local hospitals to store medical records instead of producing and assembling chips. 9. Real estate taxes paid on the factory, $14,500 Classify cach cost in the following table according to the categories listed in the table header. A cost can be classified under more than one category. For example, the…
The Lombard Company produces and sells office-space dehumidifiers to companies that own or rent office space. (a) Lombard’s materials and labor costs for producing the dehumidifiers are $3,000 per unit and the fixed costs of its dehumidifier production plant are $1.85 million. If Lombard sells a dehumidifier for $5,000 per unit, what is its percent contribution margin? Show your work. (b) If Lombard used revenue-based compensation to pay its sales force, what would be a salesperson’s sales credit for selling 20 dehumidifiers at a price of $4,500? Show your work. (c) If Lombard used the profit-based compensation method described in the course to pay its sales force and sets the dehumidifier’s target price at $5,000 per unit, what would be a salesperson’s sales credit for selling 20 dehumidifiers at a price of $4,500? Show your work. (d) Explain the benefit to Lombard’s management of using the profit-based compensation method of Part (c) over revenue-based compensation for…
Zachary Company makes and sells lawn mowers for which it currently makes the engines. It has an opportunity to purchase the engines from a reliable manufacturer. The annual costs of making the engines are shown here. Cost of materials (14,700 units x $19) Labor (14,700 units × $25) Depreciation on manufacturing equipment* Salary of supervisor of engine production Rental cost of equipment used to make engines Allocated portion of corporate-level facility-sustaining costs Total cost to make 14,700 engines *The equipment has a book value of $101,000 but its market value is zero. Required $ 279,300 367,500 37,000 84,000 16,000 79,000 $ 862,800 a. Determine the maximum price per unit that Zachary would be willing to pay for the engines. b. Determine the maximum price per unit that Zachary would be willing to pay for the engines, if production increased to 18,350 units. Note: For all requirements, round intermediate and final answers to 2 decimal places. a. Maximum price per unit b. Maximum…
Adams Company makes and sells lawn mowers for which it currently makes the engines. It has an opportunity to purchase the engines from a reliable manufacturer. The annual costs of making the engines are shown here. Cost of materials (14,200 Units x $27) Labor (14,200 Units x $14) Depreciation on manufacturing equipment* Salary of supervisor of engine production Rental cost of equipment used to make engines Allocated portion of corporate-level facility-sustaining costs Total cost to make 14,200 engines $ 383,400 198,800 22,000 74,000 15,000 86,000 $779,200 *The equipment has a book value of $105,000 but its market value is zero. Required a. Determine the maximum price per unit that Adams would be willing to pay for the engines. b. Determine the maximum price per unit that Adams would be willing to pay for the engines, if production increased to 18,300 units. (For all requirements, Round your answers to 2 decimal places.) a. Maximum price per unit b. Maximum price per unit
Zachary Company makes and sells lawn mowers for which it currently makes the engines. It has an opportunity to purchase the engines from a reliable manufacturer. The annual costs of making the engines are shown here. $ 272,000 Cost of materials (13,600 Units x $20) Labor (13,600 Units x $30) Depreciation on manufacturing equipment* Salary of supervisor of engine production Rental cost of equipment used to make engines Allocated portion of corporate-level facility-sustaining costs 408,000 29,000 74,000 12,000 79,000 Total cost to make 13,600 engines $ 874,000 *The equipment has a book value of $106,000 but its market value is zero. Required a. Determine the maximum price per unit that Zachary would be willing to pay for the engines. b. Determine the maximum price per unit that Zachary would be willing to pay for the engines, if production increased to 17,900 units. (For all requirements, Round your answers to 2 decimal places.) a. Maximum price per unit b. Maximum price per unit
Matt Simpson owns and operates Quality Craft Rentals, which offers canoe rentals and shuttle service on the Nantahala River. Customers can rent canoes at one station, enter the river there, and exit at one of two designated locations to catch a shuttle that returns them to their vehicles at the station they entered. Following are the costs involved in providing this service each year: Canoe maintenance Licenses and permits Vehicle leases Station lease Advertising Operating costs Fixed Costs Variable Costs $ 9.50 $ 3,000 3,700 0 6,100 0 7,620 0 6,700 21,700 7.50 7.50 Quality Craft Rentals began business with a $28,000 expenditure for a fleet of 30 canoes. These are expected to last 10 more years, at which time a new fleet must be purchased. Rentals have been stable at about 7,000 per year. Required: Matt is happy with the steady rental average of 7,000 per year. For this number of rentals, what price should he charge per rental for the business to make an annual 16% before-tax return on…
Jean and Tom Perritz own and manage Happy Home Helpers, Inc. (HHH), a house-cleaning service. Each cleaning (cleaning one house one time) takes a team of three house cleaners about 1.5 hours. On average, HHH completes about 15,000 cleanings per year. The following total costs are associated with the total cleanings: Required: 1. Calculate the prime cost per cleaning. 2. Calculate the conversion cost per cleaning. 3. Calculate the total variable cost per cleaning. 4. Calculate the total service cost per cleaning. 5. What if rent on the office that Jean and Tom use to run HHH increased by 1,500? Explain the impact on the following: a. Prime cost per cleaning b. Conversion cost per cleaning c. Total variable cost per cleaning d. Total service cost per cleaning
Classify Costs Following is a list of various costs incurred in producing replacement automobile parts. With respect to the production and sale of these auto parts, classify each cost as either variable, fixed, or mixed. 1. Oil used in manufacturing equipment 2. Plastic 3. Property taxes, 165,000 per year on factory building and equipment 4. Salary of plant manager 5. Cost of labor for hourly workers 6. Packaging 7. Factory cleaning costs, 6,000 per month 8. Metal 9. Rent on warehouse, 10,000 per month plus 25 per square foot of storage used 10. Property insurance premiums, 3,600 per month plus 0.01 for each dollar of property over 1,200,000 11. Straight-line depreciation on the production equipment 12. Hourly wages of machine operators 13. Electricity costs, 0.20 per kilowatt-hour 14. Computer chip (purchased from a vendor) 15. Pension cost, 1.00 per employee hour on the job

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