Skip to main content

Bartleby Sitemap - Textbook Solutions

All Textbook Solutions for Principles of Accounting Volume 2

Complete the information in the cost computations shown here:During the year, a company purchased raw materials of $77,321 and incurred direct labor costs of $125,900. Overhead Is applied at the rate of 75% of the direct labor cost. These are the inventory balances: Compute the cost of materials used in production, the cost of goods manufactured, and the cost of goods sold.Freeman Furnishings has summarized its data as shown. Direct labor hours will be used as the activity base to allocate overhead: Compute the cost of goods manufactured.Queen Bees Honey, Inc., estimated its annual overhead to be $110,000 and based its predetermined overhead rate on 27,500 direct labor hours. At the end of the year, actual overhead was $106,000 and the total direct labor hours were 29,000. What is the entry to dispose of the over applied or under applied overhead?Mountain Tops applies overhead on the basis of direct labor hours and reports the following information: A. What is the predetermined overhead rate? B. How much overhead was applied during the year? C. Was overhead over applied or under applied, and by what amount? D. What is the journal entry to dispose of the over applied or under applied overhead?The actual overhead for a company is $73,175. Overhead was based on 4,500 machine hours and was $3,325 over applied for the year. What is the overhead application rate per direct labor hour? What is the journal entry to dispose of the under applied overhead?When setting its predetermined overhead application rate. Tasty Turtle estimated its overhead would be $75,000 and manufacturing would require 25,000 machine hours in the next year. At the end of the year, it found that actual overhead was $74,000 and manufacturing required 24,000 machine hours. Determine the predetermined overhead rate. What is the overhead applied during the year? Prepare the journal entry to eliminate the under- or over applied overhead.The following data summarize the operations during the year. Prepare a journal entry for each transaction. A. Purchase of raw materials on account: $1,500 B. Raw materials used by Job 1: $400 C. Raw materials used as indirect materials: $50 D. Direct labor for Job 1: $200 E. Indirect labor Incurred for Job 1: $30 F. Factory utilities Incurred on account: $500 G. Adjusting entry for factory depreciation: $200 H. Manufacturing overhead applied as percent of direct labor: 100% I. Job 1 is transferred to finished goods J. Job 1 is sold: $1,000 K. Manufacturing overhead is under applied: $100 The Following events occurred during March for Ajax Company. Prepare a journal entry for each transaction. Materials were purchased on account for $5,429. Materials were requisitioned to begin work on Job C15 In the amount of $2,500. Direct labor expense for job C15 was $4,250. Actual overhead was incurred on account for $5,385. Factory overhead was charged w Job C15 at the rate of 200% direct labor. Job C15 was transferred to finished goods at $15,250. Job C15 was sold on account for $28,000.A leather repair shop incurred the following expenses while repairing luggage for a major airline. Time cards showing direct labor: $750 Time cards showing indirect labor: $100 Purchased repair supplies on account: $1,500 Issued indirect supplies: $350 Utilities expense on account: $24,000 Overhead applied: 100% of direct labor costs Journalize the listed transactions.Can a company use both job order costing and process costing? Why or why not?If a job order cost system tracks the direct materials and direct labor, why doesn't It track the actual overhead used for a specific job?What are the similarities in calculating the cost of materials used in production, the cost of goods manufactured, and the cost of goods sold?If a company bases its predetermined overhead rate on 100,000 machine hours, and It actually has 100,000 machine hours, would there be an under applied or over applied overhead?How do the job cost sheets act as a subsidiary ledger for the work in process inventory if journal entries are not made to the job cost sheets?How is a job order cost system used in a service industry?Which of the following production characteristics is better suited for process costing and not job order costing? Each product batch is distinguishable from the prior batch. The costs are easily traced to a specific product. Costs are accumulated by department. The value of work in process is the direct material used, the direct labor incurred, and the overhead applied to the job in process.A process costing system Is most likely used by which of the following? airplane manufacturing a paper manufacturing company an accounting firm specializing in tax returns a hospital Which of the following is a prime cost? A. direct labor B. work in process inventory C. administrative labor D. factory maintenance expenses Which of the following is a conversion cost? A. raw materials B. direct labor C. sales commissions D. direct material used During production, how are the costs in process costing accumulated? A. to cost of goods sold B. to each individual product C. to manufacturing overhead D. to each individual department Which is nor needed to compute equivalent units of production? A. the percentage of completion for inventory still in process B. the number of units transferred out C. the number of units started and completed D. the material cost per unit What is the cost of direct labor f the conversion costs are $330.000 and manufacturing overhead is $275,000? $55,000 $275,000 $330,000 $605,000 What is the conversion cost to manufacture insulated travel cups if the costs are: direct materials, $17,000; direct labor, $33,000; and manufacturing overhead, $70,000? A. $16,000 B. $50,000 C. $103,000 D. $120000 Which of the following lists contains only conversion costs for an inflatable raft manufacturing corporation? vinyl for raft, machine operator, electricity, Insurance machine operator, electricity, depreciation, plastic for air valves machine operator, electricity, depreciation, insurance vinyl for raft, electricity, insurance, plastic for air valves Direct material costs $3 per unit, direct labor costs $5 per unit, and overhead is applied at the rate of 100% of the direct labor cost. What is the value of the Inventory transferred to the next department if beginning inventory was 2,000 units; 9,000 units were started; and 1.000 units were in ending inventory? A. $1,000 B. $13,000 C. $130.000 D. $20.000 Beginning inventory and direct material cost added during the month total $55,000. What is the value of the ending work in process inventory if beginning inventory was 2,000 units; 9,000 units were started; and 1,000 units were in ending inventory? $1,000 $5,000 $50,000 $55,000 The initial processing department had a beginning inventory of 750 units and an ending inventory of 1,350 units, and it started 9,500 units into production. How many were transferred out to the next department? 750 1,350 8,900 10,250 There were 1,000 units in ending inventory after transferring 16,000 units to finished goods inventory. If the beginning inventory was 2,000 units, how many units were started in process? A. 1.000 B. 2,000 C. 15,000 D. 17,000 The costs to be accounted for consist of which of the following? A. costs added during the period B. costs of the units in ending inventory C. costs started and transferred during the period D. costs in the beginning inventory and costs added during the period Which of the following is the step in which materials, labor, and overhead are detailed? A. determining the units to which costs are assigned B. determining the equivalent units of production C. determining the cost per equivalent units D. allocating the costs to the units transferred out and the units partially completed The journal entry to record the $500 of work in process ending inventory that consists of $300 of direct materials, $50 of manufacturing overhead, and $150 od direct labor is which of the following?Assigning indirect costs to departments is completed by __________________________. applying the predetermined overhead rate debiting the manufacturing costs incurred applying the costs to manufacturing overhead applying the costs to work in process inventory In a process costing system, which account shows the overhead assigned to the department? A. cost of goods sold B. finished goods inventory C. raw material inventory D. work in process inventory In a process cost system, factory depreciation expense incurred is debited to _____________________. finished goods inventory work in process inventory manufacturing overhead cost of goods sold Explain how process costing differs from job order costing.Would a pharmaceutical manufacturer use process or job order costing? Why?Which costs are assigned using the weighted-average method?What is the primary purpose of process costing?What is the difference between prime costs and conversion costs?Explain conversion costs using an example.Why are there conversion costs in both job order costing and process costing?What are equivalent units of production, and how are they used in process costing?How can there be a different number of equivalent units for materials as compared to conversion costs?Why is the number of equivalent units for materials only sometimes equal to the equivalent units for conversion?What are the four steps involved in determining the cost of inventory transferred from one department to the next and the cost of work in process inventory?What is the weighted-average method for computing the equivalent units of production?How does process costing treat the costs transferred in from another department?Why does each department have its own work in process inventory?March each term with its description.How is manufacturing overhead handled in a process cost system?How are predetermined overhead rates used in process costing?How many units were started into production in a period if there were zero units of beginning work in process inventory, 1,100 units in ending work in process inventory, and 21,500 completed and transferred out units?A company started a new product, and in the first month started 100,000 units. The ending work in process inventory was 20,000 units that were 100% complete with materials and 75% complete with conversion costs. There were 100,000 units to account for, and the equivalent units for materials was $6 per unit while the equivalent units for conversion was $8 per unit. What is the value of the inventory transferred out, using the weighted-average inventory method?Given the following information, determine the equivalent units of ending work in process for materials and conversion under the weighted-average method: beginning inventory of 2,500 units is 100% complete with regard to materials and 60% complete with regard to conversion 18,000 units were started during the period 17,500 units were completed and transferred ending inventory is 100% complete with materials and 65% complete with conversion There were 1,700 units in beginning inventory that were 40% complete with regard to conversion. During the month, 8,550 units were started and 9,000 were transferred to finished goods. The ending work in process was 60% complete with regard to conversion costs, and materials are added at the beginning of the process. What is the total amount of equivalent units for materials and conversion at the end of the month using the weighted-average method?A company has 1,500 units in ending work in process that are 30% complete after transferring out 10,000 units. All materials are added at the beginning of the process. If the cost per unit is $4 for materials and $7 for conversion, what is the cost of units transferred out and in ending work in process inventory using the weighted-average method?There were 2,400 units in ending work in process inventory that were 100% complete with regard to material and 25% complete with regard to conversion costs. Ending work in process inventory had a cost of $9,000 and a per-unit material cost of $2. What was the conversion cost per unit using the weighted-average method?How many units must be in ending inventory if beginning inventory was 15,000 units, 55,000 Units were started, and 57,000 units were completed and transferred out?How many units must have been completed and transferred if beginning inventory was 75,000 units, ending inventory was 72,000 units, and 290,000 units were started?Using the weighted-average method, compute the equivalent units of production if the beginning inventory consisted of 20,000 units; 55,000 units were started in production; and 57,000 units were completed and transferred to finished goods inventory. For this process, materials are added at the beginning of the process, and the units are 35% complete with respect to conversion.Using the weighted-average method, compute the equivalent units of production for a new company that started 85,000 units into production and transferred 67,000 to the second department. Assume that beginning inventory was 0. Conversion is considered to occur evenly throughout the process, while materials are added at the beginning of the process. The ending inventory for Equivalent Units: Conversion is 9,000 units.Mazomanie Farm completed 20,000 units during the quarter and has 2,500 units still in process. The units are 100% complete with regard to materials and 55% complete with regard to conversion costs. What are the equivalent units for materials and conversion?What are the total costs to account for if a companys beginning inventory had $231,432 in materials, $186,450 in conversion costs, and added direct material costs ($4,231,392), direct labor ($2,313,392), and manufacturing overhead ($1,156,696)?A company started the month with 8,329 units in work in process inventory. It started 23,142 unit and had an ending inventory of 9,321. The units were 100% complete to materials and 67% complete with conversion. How many units were transferred out during the period?A production department within a company received materials of $10,000 and conversion costs of $10,000 from the prior department. It added material of $27,200 and conversion costs of $53,000. The equivalent units are 20,000 for material and 18,000 for conversion. What is the unit cost for materials and conversion?Production data show 35,920 units were transferred out of a stage of production and 6,150 units remained in ending WIP inventory that was 100% complete to material and 35% complete to conversion. The unit material cost is $5 for material and $8 for conversion. What is the amount of inventory transferred out and remaining in ending work in process inventory?Overhead is assigned to the manufacturing department at the rate of $10 per machine hour. There were 3,500 machine hours during October in the shaping department and 2,500 in the packaging department. Prepare the journal entry to apply overhead to the manufacturing departments.Prepare the journal entry to record the factory wages of $28,000 incurred for a single production department assuming payment will be made in the next pay period.Prepare the journal entry to record the transfer of 3,000 units from the packaging department to finished goods if the material cost per unit is $4 and the conversion cost per unit is $5.50.Prepare the journal entry to record the sale of 2,000 units that cost $8 per unit and sold for $15 per unit.Given the following information, determine the equivalent units of ending work in process for materials and conversion using the weighted-average method: Beginning inventory of 750 units is 100% complete with regard to materials and 30% complete with regard to conversion. 9,500 units were started during the period. 8,900 units were completed and transferred. Ending inventory is 100% complete with regard to materials and 68% complete with regard to conversion.There were 2.000 units in beginning inventory that were 70% complete with regard to conversion. During the month. 15.000 units were started, and 16,000 were transferred to finished goods. The ending work in process was 55% complete with regard to conversion costs, and materials are added at the beginning of the process. What is the total amount of equivalent units for materials and conversion at the end of the month using the weighted-average method?A company has 100 units in ending work in process that are 40% complete after transferring out 750 Units. If the cost per unit is $5 for materials and $2.50 for conversion, what is the cost of units transferred out and in ending work in process inventory using the weighted-average method?There were 1,500 units in ending work in process inventory that were 100% complete with regard to material and 60% complete with regard to conversion costs. Ending work in process inventory had a cost of $7,200 and a per-unit material cost of $3. What was the conversion cost per unit using the weighted-average method?Using the weighted-average method, compute the equivalent units of production if the beginning inventory consisted of 20,000 units, 55,000 units were started in production, and 57,000 units were completed and transferred to finished goods inventory. For this process, materials are 70% complete and the Units are 30% complete with respect to conversion.What are the total costs to account for if a companys beginning inventory had $23,432 in materials and $18,450 in conversion costs, and added direct material costs ($41,392), direct labor ($23,192), and manufacturing overhead ($62,500)?A company started the month with 4,519 units in work in process inventory. It started 15,295 units and had an ending inventory of 4,936. The units were 100% complete to materials and 30% complete with conversion. How many units were transferred out during the period?A production department within a company received materials of $7,000 and conversion costs of $5,000 from the prior department. It added material of $78400 and conversion costs of $47000. The equivalent units are 5,000 for material and 4,000 for conversion. What is the unit cost for materials and conversion?Production data show 15,200 units were transferred out of a stage of production and 3,500 units remained in ending WIP inventory that was 100% complete to material and 60% complete to conversion. The unit material cost is $9 for material and $4 for conversion. What is the amount of inventory transferred out and remaining in ending work in process inventory?Overhead is assigned to the manufacturing department at the rate of $5 per machine hour. There were 3,000 machine hours used in the molding department. Prepare the journal entry to apply overhead to the manufacturing department.Prepare the journal entry to record the factory wages of $25,000 incurred in the processing department and $15,000 incurred in the production department assuming payment will be made in the next pay period.Prepare the journal entry to record the transfer of 3,500 units from the separation department to the mash department if the material cost per unit is $2 and the conversion cost per unit is $5.Prepare the journal entry to record the sale of 700 units that cost $5 per unit and sold for $15 per unit.The following product Costs are available for Haworth Company on the production of chairs: direct materials, $15,500; direct labor, $22.000; manufacturing overhead, $16.500; selling expenses, $6,900; and administrative expenses, $15,200. What are the prime costs? What are the conversion costs? What is the total product cost? What is the total period cost? If 7,750 equivalent units are produced, what is the equivalent material cost per unit? If 22,000 equivalent units are produced, what is the equivalent conversion cost per unit?The following product costs are available for Arrez Company on the production of DVD cases: direct materials, $1,450: direct labor. $15.50; manufacturing overhead, applied at 150% of direct labor cost; selling expenses. $1,550; and administrative expenses, $950. The direct labor hours worked for the month are 90 hours, A. What are the prime costs? B. What are the conversion costs? C. What is the total product cost? D. What is the total period cost? E. 111,450 equivalent units are produced, what is the equivalent material cost per unit? F. What is the equivalent conversion cost per unit?Pant Risers manufactures bands for self-dressing assistive devices for mobility-impaired individuals. Manufacturing is a one-step process where the bands are cut and sewn. This is the information related to this years production: Â Ending inventory was 100% complete as to materials and 70% complete as to conversion, and the total materials cost is $57,540 and the total conversion cost is $36,036. Using the weighted-average method, what are the unit costs if the company transferred out 17,000 units? What is the value of the inventory transferred out and the value of the ending WIP inventory?During March, the following costs were charged to the manufacturing department: $14886 for materials; $14,656 for labor; and $13,820 for manufacturing overhead. The records show that 30,680 units were completed and transferred, while 2,400 remained in ending inventory. There were 33,080 equivalent units of material and 31,640 of conversion costs. Using the weighted-average method, what is the cost of inventory transferred and the balance in work in process inventory?Materials are added at the beginning of a production process, and ending work in process inventory is 30% complete with respect to conversion costs. Use the information provided to complete a production cost report using the weighted-average method.Narwhal Swimwear has a beginning work in process inventory of 13,500 units and transferred in 130,000 units before ending the month with 14,000 units that were 100% complete with regard to materials and 30% complete with regard to conversion costs. The cost per unit of material is $5.80 and the cost per unit for conversion is $8.20 per unit. Using the weighted-average method, what is the amount of material and conversion costs assigned to the department for the month?The following data show the units in beginning work in process inventory, the number of units started, the number of units transferred, and the percent completion of the ending work in process for conversion. Given that materials are added at the beginning of the process, what are the equivalent units for material and conversion costs for each quarter using the weighted-average method? Assume that the quarters are independent.The finishing department started the month with 700 units in WIP inventory. It received 2.200 units from the molding department and transferred out 2,150 units. How many units were in process at the end of the month?The packaging department began the month with 500 units that were 100% complete with regard to material and 85% complete with regard to conversion. It received 9,500 units from the processing department and ended the month with 750 units that were 100% complete with regard to materials and 30% complete with regard to conversion. With a $5 per unit cost for conversion and a $5 per unit cost for materials, what is the cost of the units transferred out and remaining in ending inventory?Production information shows these costs and units for the smoothing department in August. All materials are added at the beginning of the period. The ending work in process is 30% complete as to conversion. What is the value of the inventory transferred to finished goods and the value of the WIP inventory at the end of the month?Given the following information, prepare a production report with materials added at the beginning and ending work in process inventory being 25% complete with regard to conversion costs.Complete this production cost report:Selected information from Skylar Studios shows the following: Prepare journal entries to record the following: raw material purchased direct labor incurred depreciation expense (hint: this is part of manufacturing overhead) raw materials used overhead applied on the basis of $0.50 per machine hour the transfer from department 1 to department 2 Loanstar had 100 units in beginning inventory before starting 950 units and completing 800 units. The beginning work in process inventory consisted of $2,000 in materials and $500O in conversion costs before $8.500 of materials and $11,200 of conversion costs were added during the month. The ending WIP inventory was 100% complete with regard to materials and 40% complete with regard to conversion costs. Prepare the journal entry to record the transfer of inventory from the manufacturing department to the finished goods department.The following product costs are available for Stellis Company on the production of erasers: direct materials, $22,000; direct labor, $35,000; manufacturing overhead, $17,500; selling expenses, $17,600; and administrative expenses; $13,400. What are the prime costs? What are the conversion costs? What is the total product cost? What is the total period cost? If 13,750 equivalent units are produced, what is the equivalent material cost per unit? If 17,500 equivalent units are produced, what is the equivalent conversion cost per unit?The following product costs are available for Kellee Company on the production of eyeglass frames: direct materials, $32,125; direct labor, $23.50; manufacturing overhead, applied at 225% of direct labor cost; selling expenses, $22,225; and administrative expenses, $31,125. The direct labor hours worked for the month are 3,200 hours. A. What are the prime costs? B. What are the conversion costs? C. What is the total product cost? D. What is the total period cost? E. If 6.425 equivalent units are produced, what is the equivalent material cost per unit? F. What is the equivalent conversion cost per unit?Vexar manufactures nails. Manufacturing is a one-step process where the nails are forged. This is the information related to this years production: Â Ending inventory was 100% complete as to materials and 70% complete as to conversion, and the total materials cost is $115,080 and the total conversion cost is $72,072. Using the weighted-average method, what are the unit costs if the company transferred out 34,000 units? Using the weighted-average method, prepare the companys process cost summary for the month.During March, the following costs were charged to the manufacturing department: $22,500 for materials; $45,625 for labor; and $50,000 for manufacturing overhead. The records show that 40,000 units were completed and transferred, while 10,000 remained in ending inventory. There were 45,000 equivalent units of material and 42,500 units of conversion costs. Using the weighted-average method, prepare the companys process cost summary for the month.Ardt-Barger has a beginning work in process inventory of 5.500 units and transferred in 25,000 units before ending the month with 3.000 u flits that were 100% complete with regard to materials and 80% complete with regard to conversion costs. The cost per unit of material is $5.45, and the cost per unit for conversion is $6.20 per unit, Using the weighted-average method, prepare the companys process cost summary for the month.The following data show the units in beginning work in process inventory, the number of units started, the number of units transferred, and the percent completion of the ending work in process for conversion. Given that materials are added at the beginning of the process, what are the equivalent units for material and conversion costs for each quarter using the weighted-average method? Assume that the quarters are independent.The following data show the units in beginning work in process inventory, the number of units started, the number of units transferred, and the percent completion of the ending work in process for conversion. Given that materials are added 50% at the beginning of the process and 50% at the end of the process, what are the equivalent units for material and conversion costs for each quarter using the weighted-average method? Assume that the quarters are independent.The following data show the units in beginning work in process inventory, the number of units started, the number of units transferred, and the percent completion of the ending work in process for conversion. Given that materials are added 50% at the beginning of the process and 50% at the end of the process, what are the equivalent units for material and conversion costs for each quarter using the weighted-average method? Assume that the quarters are independent.The finishing department started the month with 600 units in WIP inventory. Lt received 1,500 units from the molding department and ended the month with 550 units still in process. How many units were transferred out?The packaging department began the month with 750 units that were 100% complete with regard to material and 25% complete with regard to conversion. It received 9,500 units from the processing department and ended the month with 500 units that were 100% complete with regard to materials and 75% complete with regard to conversion. With a $7 per unit material cost and a $4 per unit cost for conversion, what is the cost of the units transferred out and remaining in ending inventory?Production information shows these costs and units for the smoothing department in August. What is the value of the inventory transferred out to finished goods and the value of the WIP inventory at the end of the month, assuming conversion costs are 30% complete?Given the following information, prepare a production report with materials added at the beginning and ending work in process inventory being 80% complete with regard to conversion costs.Selected information from Hernandez Corporation shows the following: Prepare journal entries to record the following: raw material purchased direct labor incurred depreciation expense (hint: this is part of manufacturing overhead) raw materials used overhead applied on the basis of $0.50 per machine hour the transfer from department 1 to department 2 Rexar had 1,000 units in beginning inventory before starting 9.500 units and completing 8,000 units. The beginning work in process inventory consisted of $5,000 in materials and $8,500 in conversion costs before $16,000 of materials and $18,500 of conversion costs were added during the month. The ending WIP inventory was 100% complete with regard to materials and 40% complete with regard to conversion costs. Prepare the journal entry to record the transfer of inventory from the manufacturing department to the finished goods department.How would process costing exist in a service industry?Why are labor and manufacturing overhead grouped together as conversion costs?How is process costing for a single manufacturing department different from a manufacturing company with multiple departments?What is different between the journal entries for process costing and that of job order costing?Active Frame, Inc., manufactures clear and tinted sport glasses. The manufacturing of clear glasses takes 45,000 direct labor hours and involves 1,700 parts and 115 inspections. The manufacturing of tinted glasses takes 115,000 direct labor hours and involves 1,400 parts and 450 inspections. The traditional method applies $560,000 of overhead on the basis of direct labor hours. What is the amount of overhead per direct labor hour applied to the clear glass products? A. $933.33 B. $157,500 C. $322.500 D. $402,500 TyeDye Lights makes two products: Party and Holiday. It takes 80,900 direct labor hours to manufacture the Party Line and 93,500 direct labor hours to manufacture the Holiday Line. Overhead consists of $225,000 in the machine setup cost pool and $149,960 in the packaging cost pool. The machine setup pool has 52,000 setups for the Party product and 98,000 setups for the Holiday product. The packaging cost pool has 26,000 parts in the Party product and 39,200 parts for the Holiday product. Using the traditional cost method of direct labor hours, what is the predetermined overhead rate? A. $1.50 per direct labor hour B. $2.15 per direct labor hour C. $2.30 per direct labor hour D. $3.80 per direct labor hour Which is not a step in analyzing the cost driver for manufacturing overhead? A. Identify the cost B. identify non-value-added costs C. analyze the effect on manufacturing overhead D. identify the correlation between the potential driver and manufacturing overhead Overhead costs are assigned to each product based on __________________. A. the proportion of that products use of the cost driver B. a predetermined overhead rate for a single cost driver C. price of the product D. machine hours per product Which of the following is a reason a company would implement activity-based costing? A. The cost of record keeping is high. B. The additional data obtained through traditional allocation are not worth the cost. C. They want to improve the data on which decisions are made. D. A company only has one cost driver.Which is the correct formula for computing the overhead rate? A. estimated use of the cost driver for production/estimated overhead for the activity B. estimated overhead for the product/estimated use of the cost driver for the activity C. estimated use of the cost driver for production/estimated overhead for the activity D. estimated overhead for the activity/estimated use of the cost driver for the activity A company anticipates the cost to heat the building will be $21.000. Product A Lakes up 500 square feet of space, while Product B takes up 200 square feet. The activity rate per product using activity-based costing would be which of the following? A. $30/square foot B. $4.20/square foot C. $11/square foot D. $15.20/square foot A company calculated the predetermined overhead based on an estimated overhead of $70.000, and the activity for the cost driver was estimated as 2,500 hours. If product A utilized 1,350 hours and product 8 utilized 1,100 hours, what was the total amount of overhead assigned to the products? A. $35000 B. $30.800 C. $37,800 D. $68,600 Which is not a step In activity-based costing? A. identify the activities performed by the organization B. identify the cost driver(s) associated with each activity C. compute a cost rate per production D. assign costs to products by multiplying the cost driver rate by the volume of the cost driver units consumed by the product What is the proper order of tasks In an ABC system? identify the cost drivers, assign the costs to the products, calculate the overhead application rate for each cost pool, identify the cost pools assign the costs to the products, identify the cost drivers, calculate the overhead application rate for each cost pool, identify the cost pools identify the cost drivers, identify the cost pools, calculate the overhead application rate for each cost pool, assign the costs to the products identify the cost pools, identify the cost drivers, calculate the overhead application rate for each cost pool, assign the costs to the products Which is not a task typically associated with ABC systems? A. calculating the overhead application rate for each cost pool B. applying a single cost rate C. identifying a cost driver D. more correctly allocating overhead costs Which statement is correct? A. Activity-based cost systems are less costly than traditional cost systems. B. Activity-based cost systems are easier to implement than traditional cost systems. C. Activity-based cost systems are more accurate than traditional cost systems. D. Activity-based cost systems provide the same data as traditional cost systems.Activity-based costing systems: A. use a single predetermined overhead rate based on machine hours instead of on direct labor B. frequently increase the overhead allocation to at least one product while decreasing the overhead allocation to at least one other product C. limit the number of cost pools D. always result in an increase of at least one products selling price Activity-based costing is preferable in a system: when multiple products have similar product volumes and costs with a large direct labor cost as a percentage of the total product cost with multiple, diverse products where management needs to support an increase in sales price Absorption costing is also referred to as: A. direct costing B. marginal costing C. full costing D. variable costing Under variable costing, a unit of product includes which costs? direct material, direct labor, and manufacturing overhead Direct material, direct labor, and variable manufacturing overhead Direct material, direct labor, and fixed manufacturing overhead D. Direct material, direct labor, and all variable manufacturing overhead Under absorption costing, a unit of product includes which costs? A. direct material, direct labor, and manufacturing overhead B. direct material, direct labor, and variable manufacturing overhead C. direct material, direct labor, and fixed manufacturing overhead D. direct material, direct labor, and all variable manufacturing overhead A downside to absorption casting is: not including fixed manufacturing overhead in the cost of the product that it is not really useful for managerial decisions that it is not allowable under GAAP that it is not well designed for cost-volume-profit analysis When the number of units in ending inventory increases through the year, which of the following is true? A. Net income is the same for variable and absorption costing. B. Net income is higher for variable costing than for absorption costing. C. Net income is higher for absorption costing than for variable costing. D. There is no relationship between net Income and the costing method.Product costs under variable costing are typically: A. higher than under absorption costing B. lower than under absorption costing C. the same as with absorption costing D. higher than absorption costing when inventory increases What is the predetermined overhead rate, and when is it typically estimated?When is an activity-based costing system better than a traditional allocation system?What is the advantage of labeling activities as value added or nonvalue added?What conditions are necessary to designate an activity as a cost driver?For each cost pool, identify an appropriate cost driver. A. order department B. accounts receivable processing C. catering D. raw material inventory How is the primary focus of activity-based costing different from that of traditional allocation?What are the primary differences between traditional and activity-based costing?How are service companies similar or different from manufacturing companies in using ABC costing?How are costs allocated in an ABC system?In production, what has changed to allow ABC costing to become valuable?Why is it important to know the true cost for a product or service?What is the primary difference between variable costing and absorption costing?Why would managers prefer variable costing over absorption costing?Why is absorption costing the method allowable for GAAP?Can a company gather information for both variable and absorption costing systems?Steeler Towel Company estimates its overhead to be $250,000. It expects to have 100,000 direct labor hours costing $2,500,000 in labor and utilizing 12,500 machine hours. Calculate the predetermined overhead rate using: A. Direct labor hours B. Direct labor dollars C. Machine hours Crystal Pools estimates overhead will utilize 250,000 machine hours and cost $750,000. It takes 2 machine hours per unit, direct material cost of $14 per unit, and direct labor of $20 per unit. What is the cost of each unit produced?A company estimated 100,000 direct labor hours and $800,000 in overhead. The actual overhead was $805,100, and there were 99,900 direct labor hours. What is the predetermined overhead rate, and how much was applied during the year?Cozy, Inc., manufactures small and large blankets. It estimates $350,000 in overhead during the manufacturing of 75,000 small blankets and 25,000 large blankets. What is the predetermined overhead rate if a small blanket takes 1 machine hour and a large blanket takes 2 machine hours?Identify appropriate cost drivers for these cost pools: A. setup cost pools B. assembly cost pool C. supervising cost pool D. testing cost pool Match the activity with the most appropriate cost driver. Table 6.5 Rex Industries has two products. They manufactured 12,539 units of product A and 8.254 units of product B. The data are: What is the activity rate for each cost pool?Rex Industries has identified three different activities as cost drivers: machine setups, machine hours, and inspections. The overhead and estimated usage are: Compute the overhead rate for each activity.Customs makes two types of hats: polyester (poly) and silk. There are two cost pools: setup, with an estimated $100,000 in overhead, and inspection, with $25,000 in overhead. Poly is estimated to have 750,000 setups and 170,000 inspections, while silk has 250,000 setups and 80,000 inspections. How much overhead is applied to each product?Customs has three cost pools and an associated cost driver to allocate the costs to the product. The cost pools, cost driver, estimated overhead, and estimated activity for the cost pool are: What is the predetermined overhead rate for each activity?Potterii sells its products to large box stores and recently added a retail line of products to sell directly to consumers. These estimates are to be used in determining the overhead allocation rate for ABC: What would be the predetermined rate for each cost pool?Assign each of the following expenses to either the machine setup cost pool or the factory cost pool: A. indirect materials B. inspections C. factory insurance D. machine depreciation E. machine setup (indirect labor) F. machine setup (indirect material)Tri-bikes manufactures two different levels of bicycles: the Standard and the Extreme. The total overhead of $300,000 has traditionally been allocated by direct labor hours, with 150.000 hours for the Standard and 50,000 hours for the Extreme. After analyzing and assigning costs to two cost pools, it was determined that machine hours is estimated to have $200,000 of overhead, with 4,000 hours used on the Standard product and 1,000 hours used on the Extreme product. k was also estimated that the setup cost pool would have $100000 of overhead, with 1,000 hours for the Standard and 1,500 hours for the Extreme. What is the overhead rate per product, under traditional and under ABC costing?Cool Pool has these costs associated with production of 20,000 units of accessory products: direct materials, $70; direct labor, $110; variable manufacturing overhead, $45; total fixed manufacturing overhead, $800,000. What is the cost per unit under both the variable and absorption methods?Using this information from Planters. Inc., what is the cost per unit under both variable and absorption costing?Green Bay Cheese Company estimates its overhead to be $375,000. It expects to have 125,000 direct labor hours costing $1,500,000 in labor and utilizing 15,000 machine hours. Calculate the predetermined overhead rate using: A. Direct labor hours B. Direct labor dollars C. Machine hours Boarders estimates overhead will utilize 160,000 machine hours and cost $80,000. It takes 4 machine hours per unit, direct material cost of $5 per unit, and direct labor of $5 per unit. What is the cost of each unit produced?A company estimated 50,000 direct labor hours and $450,000 in overhead. The actual overhead was $445,000, and there were 50,500 direct labor hours. What is the predetermined overhead rate, and how much was applied during the year?Cozy, Inc., manufactures small and large blankets. It estimates $950,000 in overhead during the manufacturing of 360,000 small blankets and 120,000 large blankets. What is the predetermined overhead rate if a small blanket takes 2 hours of direct labor and a large blanket takes 3 hours of direct labor?Identify appropriate cost drivers for these cost pools: A. material cost pool B. machine cost pooi C. painting cost pool D. maintenance cost pool Match the activity with the most appropriate cost driver. Table 6.6 Rocks Industries has two products. They manufactured 12,539 units of product A and 8.254 units of product B. The data are: Â What is the activity rate for each cost pool?Rocks Industries has identified three different activities as cost drivers: machine setups, machine hours, and inspections. The overhead and estimated usage are: Compute the overhead rate for each activity.Frenchys makes two types of scarves: polyester (poly) and silk. There are two cost pools: setup, with an estimated $120,000 in overhead, and inspection, with $30,000 in overhead. Poly is estimated to have 800,000 setups and 450,000 inspections, while silk has 400,000 setups and 150,000 inspections. How much overhead is applied to each product?Frenchys has three cost pools and an associated cost driver to allocate the costs to the product. The cost pools, cost driver, estimated overhead, and estimated activity for the cost pool are: What is the predetermined overhead rate for each activity?Carboni recently added a carbon line in addition to its aluminum line. The following are estimates to be used in determining the overhead allocation rate for ABC. What would be the predetermined rate for each cost pool?Assign each of the following expenses to either the machine cost pool or the factory cost pool: A. property taxes B. heat and air-conditioning C. electricity, machines D. plant depreciation E. electricity, plant F. machine maintenance wages Stacks manufactures two different levels of hockey sticks: the Standard and the Slap Shot. The total overhead of $600,000 has traditionally been allocated by direct labor hours, with 400,000 hours for the Standard and 200.000 hours for the Slap Shot. After analyzing and assigning costs to two cost pools, it was determined that machine hours is estimated to have $450.000 of overhead, with 30,000 hours used on the Standard product and 15,000 hours used on the Slap Shot product. It was also estimated that the inspection cost pool would have $150,000 of overhead, with 25,000 hours for the Standard and 5,000 hours for the Slap Shot. What is the overhead rate per product, under traditional and under ABC costing?Crafts 4 All has these costs associated with production of 12,000 units of accessory products: direct materials, $19; direct labor, $30; variable manufacturing overhead, $15; total fixed manufacturing overhead, $450,000. What is the cost per unit under both the variable and absorption methods?Using this information from Outdoor Grills, what is the cost per unit under both variable and absorption costing?Colonels uses a traditional cost system and estimates next years overhead will be $480,000, with the estimated cost driver of 240,000 direct labor hours. It manufactures three products and estimates these costs: If the labor rate is $25 per hour, what is the per-unit cost of each product?Five Card Draw manufactures and sells 24,000 units of Diamonds, which retails for $180, and 27,000 units of Clubs, which retails for $190. The direct materials cost is $25 per unit of Diamonds and $30 per unit of Clubs. The labor rate is $25 per hour, and Five Card Draw estimated 180,000 direct labor hours. It takes 3 direct labor hours to manufacture Diamonds and 4 hours for Clubs. The total estimated overhead is $720,000. Five Card Draw uses the traditional allocation method based on direct labor hours. A. What is the gross profit per unit for Diamonds and Clubs? B. What is the total gross profit for the year?A local picnic table manufacturer has budgeted these overhead costs: They are considering adapting ABC costing and have estimated the cost drivers for each pool as shown: Recent success has yielded an order for 1,000 tables. Assume direct labor costs per hour of $20. Determine how much the job would cost given the following activities:Explain how each activity in this list can be associated with the corresponding unit or batch level provided. A. Assembling products: unit level B. Issuing raw materials: batch level C. Machine setup: batch level D. Inspection: unit level E. Loading the labeling machine: batch level F. Equipment maintenance: batch level G. Printing a banner: unit level H. Moving material: batch level I. Ordering a part: batch level Medical Tape makes two products: Generic and Label. It estimates it will produce 423,694 units of Generic and 652,200 of Label, and the overhead for each of its cost pools is as follows: It has also estimated the activities for each cost driver as follows: How much is the overhead allocated to each unit of Generic and Label?Box Springs, Inc., makes two sizes of box springs: twin and double. The direct material for the twin is $25 per unit and $40 s used in direct labor, while the direct material for the double is $40 per unit, and the labor cost is $50 per unit. Box Springs estimates it will make 5,000 twins and 9,000 doubles in the next year. It estimates the overhead for each cost pool and cost driver activities as follows: How much does each unit cost to manufacture?Please use the information from this problem for these calculations. After grouping cost pools and estimating overhead and activities, Box Springs determined these rates: It estimates there will be five orders in the next year, and those jobs will involve: What is the total cost of the jobs?A company has traditionally allocated its overhead based on machine hours but had collected this information to change to activity-based costing: A. How much overhead would be allocated to each unit under the traditional allocation method? B. How much overhead would be allocated to each unit under activity-based costing?Carltons Kitchens makes two types of pasta makers: Strands and Shapes. The company expects to manufacture 70,000 units of Strands, which has a per-unit direct material cost of $10 and a per-unit direct labor cost of $60. It also expects to manufacture 30.000 units of Shapes, which has a per-unit material cost of $15 and a per-unit direct labor cost of $40. It is estimated that Strands will use 140,000 machine hours and Shapes will require 60,000 machine hours. Historically, the company has used the traditional allocation method and applied overhead at a rate of $21 per machine hour. It was determined that there were three cost pools, and the overhead for each cost pool is shown: The cost driver for each cost pool and its expected activity is shown: A. What is the per-unit cost for each product under the traditional allocation method? B. What is the per-unit cost for each product under ABC costing?Carltons Kitchens three cost pools and overhead estimates are as follows: Compare the overhead allocation using: A. The traditional allocation method B. The activity-based costing method (Hint: the traditional method uses machine hours as the allocation base.)Lampierre makes brass and gold frames. The company computed this information to decide whether to switch from the traditional allocation method to ABC: The estimated overhead for the material cost pool is estimated as $12,500, and the estimate for the machine setup pool is $35,000. Calculate the allocation rate per unit of brass and per unit of gold using: A. The traditional allocation method B. The activity-based costing method Portable Seats makes two chairs: folding and wooden. This information was obtained to review the decision to consider ABC: Compute the overhead assigned to each product under: A. The traditional allocation method B. The activity-based costing method Grainger Company produces only one product and sells that product for $100 per unit. Cost information for the product is: Selling expenses are $4 per unit and are all variable. Administrative expenses of $20,000 are all fixed. Grainger produced 5,000 units; sold 4,000; and had no beginning inventory. A. Compute net income under absorption costing variable costing B. Reconcile the difference between the income under absorption and variable costing.Summarized data for Walrus Co. for its first year of operations are: A. Prepare an income statement under absorption costing B. Prepare an income statement under variable costing Happy Trails has this information for its manufacturing: Â Its income statement under absorption costing is: Prepare an income statement with variable costing and a reconciliation statement between both methods.Appliance Apps has the following costs associated with its production and sale of devices that allow appliances to receive commands from cell phones. Prepare an income statement under both the absorption and variable costing methods along with a reconciliation between the two statements.This information was collected for the first year of manufacturing for Appliance Apps: Prepare an income statement under variable costing, and prepare a reconciliation to the income under the absorption method.Bobcat uses a traditional cost system and estimates next years overhead will be $800.000, as driven by the estimated 25,000 direct labor hours. It manufactures three products and estimates the following costs: If the labor rate is $30 per hour, what is the per-unit cost of each product?Five Card Draw manufactures and sells 10,000 units of Aces, which retails for $200, and 8,000 units of Kings, which retails for $170. The direct materials cost is $20 per unit of Aces and $15 per unit of Kings. The labor rate is $30 per hour, and Five Card Draw estimated 64000 direct labor hours. It takes 4 direct labor hours to manufacture Aces and 3 hours for Kings. The total estimated overhead is $128,000. Five Card Draw uses the traditional allocation method based on direct labor hours. A. How much is the gross profit per unit for Aces and Kings? B. What is the total gross profit for the year?A local picnic table manufacturer has budgeted the following overhead costs: They are considering adapting ABC costing and have estimated the cost drivers for each pool as shown: Recent success has yielded an order for 1,500 tables. Determine how much the job would cost given the following activities, and assuming an hourly rate for direct labor of $25 per hour:Explain how each activity in this list can be associated with the corresponding unit or batch level provided. A. Assembling products: batch level B. Issuing raw materials: unit level C. Machine setup: unit level D. Inspection: batch level E. Loading the labeling machine: unit level F. Equipment maintenance: unit level G. Printing a banner: batch level H. Moving material: unit level i. ordering a part: unit level Wrappers Tape makes two products: Simple and Removable. It estimates it will produce 369,991 units of Simple and 146,100 of Removable, and the overhead for each of its cost pools is as follows: It has also estimated the activities for each cost driver as follows: Â How much is the overhead allocated to each unit of Simple and Removable?Box Springs. Inc., makes two sizes of box springs: queen and king. The direct material for the queen is $35 per unit and $55 is used in direct labor, while the direct material for the king is $55 per unit, and the labor cost is $70 per unit. Box Springs estimates it will make 4,300 queens and 3,000 kings in the next year. It estimates the overhead for each cost pool and cost driver activities as follows: How much does each unit cost to manufacture?Please use the information from this problem for these calculations. After grouping cost pools and estimating overhead and activities, Box Springs determined these rates: Box Springs estimates there will be four orders in the next year, and those jobs will involve: What is the total cost of the jobs?A company has traditionally allocated its overhead based on machine hours but collected this information to change to activity based costing: A. How much overhead would be assigned to each unit under the traditional allocation method? B. How much overhead would be assigned to each unit under activity-based costing?Caseys Kitchens makes two types of food smokers: Gas and Electric. The company expects to manufacture 20,000 units of Gas smokers, which have a per-unit direct material cost of $15 and a per-unit direct labor cost of $25. k also expects to manufacture 50,000 units of Electric smokers, which have a per-unit material cost of $20 and a per-unit direct labor cost of $45. Historically, it has used the traditional allocation method and applied overhead at a rate of $125 per machine hour. It was determined that there were three cost pools, and the overhead for each cost pool is as follows: The cost driver for each cost pool and its expected activity is as follows: A. What is the per-unit cost for each product under the traditional allocation method? B. What is the per-unit cost for each product under ABC costing? C. Compared to ABC costing, was each products overhead under- or over applied? D. How much was overhead under- or over applied for each product?Caseys Kitchens three cost pools and overhead estimates are as follows: Compare the overhead allocation using: A. The traditional allocation method B. The activity based costing method (Hint: the traditional method uses machine hours as the allocation base.)Lampierre makes silver and gold candlesticks. The company computed this information to decide whether to switch from the traditional allocation method to ABC. The estimated overhead for the material cost pool is estimated as $45,000, and the estimate for the machine setup pool is $55,000. Calculate the allocation rate per unit of silver and per unit of gold using: A. The traditional allocation method B. The activity-based costing method Portable Seats makes two chairs: folding and wooden. This information was obtained to review the decision to consider ABC: Compute the overhead assigned to each product under: A. The traditional allocation method B. The activity-based costing method Submarine Company produces only one product and sells that product for $150 per unit. Cost information for the product is as follows: Selling expenses are $2 per unit and are all variable. Administrative expenses of $15,000 are all fixed, Submarine produced 2.000 units and sold 1.800. Grainger had no beginning inventory. A. Compute net income under absorption costing variable costing B. Reconcile the difference between the income under absorption and variable costing.Summarized data for Backdraft Co. for its first year of operations are as follows: A. Prepare an income statement under absorption costing B. Prepare an income statement under variable costing Trail Outfitters has this information for its manufacturing: Its income statement under absorption costing is as follows: Prepare an income statement with variable costing and a reconciliation statement between both methods.Wifi Apps has these costs associated with its production and sale of devices that allow visual communications between cell phones: Prepare an income statement under both the absorption and variable costing methods along with a reconciliation between the two statements.This information was collected for the first year of manufacturing for Wifi Apps: Prepare an income statement under variable costing and prepare a reconciliation to the income under the absorption method.What conditions are optimal for using traditional allocation? Is the allocation more effective when there is high-volume production?College Cases sells cases for electronic devices such as phones, computers, and tablets. These cases have college logos or mascots on them and can be customized by adding such things as the customers name, initials, sport, or fraternity letters. The company buys the cases in various colors and then uses laser technology to do the customization of the letters and to add school names, logos, mascots, and so on. What are potential activity-based costing pools for College Cases, and what would be appropriate cost drivers?How would a service industry apply activity-based Costing?Cape Cod Adventures makes foam noodles with sales of 3,000,000 units per year and retractable boat oars with sales of 50,000 pairs per year. What information would Cape Cod Adventures need in order to change from traditional to ABC costing? What are the limitations to activity-based costing?In designing a bonus structure to reward your production managers, one of the options is to reward the managers based on reaching annual income targets. What are the differences between a reward system for a company that uses absorption costing and one for a company that uses variable costing?Which of the following is not a part of budgeting? A. planning B. finding bottlenecks C. providing performance evaluations D. preventing net operating losses Which of the following is an operating budget? A. cash budget B. production budget C. tax budget D. capital budget Which of the following is a finance budget? A. cash budget B. production budget C. direct materials purchasing budget D. tax budget Which approach is most likely to result in employee buy-in to the budget? A. top-down approach B. bottom-up approach C. total participation approach D. basing the budget on the prior year Which approach requires management to justify all its expenditures? A. bottom-up approach B. zero-based budgeting C. master budgeting D. capital allocation budgeting Which of the following is true in a bottom-up budgeting approach? Every expense needs to be justified. Supervisors tell departments their budget amount and the departments are free to work within those amounts. Departments budget their needs however they see fit. Departments determine their needs and relate them to the overall goals.The most common budget is prepared for a __________. A. week B. month C. quarter D. year Which of the operating budgets is prepared first? A. production budget B. sales budget C. cash received budget D. cash payments budget The direct materials budget is prepared using which budgets information? A. cash payments budget B. cash receipts budget C. production budget D. raw materials budget Which of the following is not an operating budget? A. sales budget B. production budget C. direct labor budget D. cash budget Which of the following statements is not correct? A. The sales budget is computed by multiplying estimated sales by the sales price. B. The production budget begins with the sales estimated for each period. C. The direct materials budget begins with the sales estimated for each period. D. The sales budget is typically the first budget prepared.The units required in production each period are computed by which of the following methods? adding budgeted sales to the desired ending inventory and subtracting beginning inventory adding beginning inventory, budgeted sales, and desired ending inventory adding beginning inventory to budgeted sales and subtracting desired ending inventory adding budgeted sales to the beginning inventory and subtracting the desired ending inventory.The cash budget is part of which category of budgets? sales budget cash payments budget finance budget operating budget Which is not a section of the cash budget? cash receipts cash disbursements allowance for uncollectible accounts financing needs Which budget is the starting point in preparing financial budgets? the budgeted income statement the budgeted balance sheet the capital expense budget the cash receipts budget Which of the following includes only financial budgets? capital asset budget, budgeted income statement, sales budget production budget, capital asset budget, budgeted balance sheet cash budget, budgeted balance sheet, capital asset budget budgeted income statement, direct material purchases budget, cash budget Which budget evaluates the results of operations at the actual level of activity? capĂtal budget cash budget flexible budget static budget What is the main difference between static and flexible budgets? The fixed manufacturing overhead is adjusted for units sold in the flexible budget. The variable manufacturing overhead is adjusted in the static budget. There is no difference between the budgets. The variable costs are adjusted in a flexible budget.What is a budget and what are the different types of budgets?What is the difference between budgeting and long-range planning?What are the advantages and disadvantages of the bottom-up budgeting approach?Why might a rolling budget require more management participation than an annual budget?What information is necessary for the operating budgets?What operating budget exists for manufacturing but not for a retail company?What is the process for developing a budgeted balance sheet?Which of the financial budgets is the most important? Why?A company has prepared the operating budget and the cash budget. It is now preparing the budgeted balance sheet. Identify the document that contains each of these balances. A. cash B. accounts receivable C. finished goods inventory D. accounts payable E. equipment purchases Fill in the blanks: A flexible budget summarizes _____ and _____ for various volume levels by adjusting the _____ costs for the various levels of activities. The costs remain the same for all levels of activities.What information is included in the capital asset budget?Why does budget planning typically begin with the sales forecast?What steps should be considered it a budget is to be set and later have its results evaluated?Blue Book printing is budgeting sales of 25,000 units and already has 5,000 in beginning inventory. How many units must be produced to also meet the 7,000 units required in ending inventory?How many units are in beginning inventory it 32,000 units are budgeted for sales, 35,000 units are produced, and the desired ending inventory is 9,000 units?Navigator sells GPS trackers for $50 each. It expects sales of 5,000 units in quarter 1 and a 5% increase each subsequent quarter for the next 8 quarters. Prepare a sales budget by quarter for the first year.One Device makes universal remote controls and expects to sell 500 units in January, 800 in February, 450 in March, 550 in April, and 600 in May. The required ending inventory is 20% of the next months sales. Prepare a production budget for the first four months of the year.Sunrise Poles manufactures hiking poles and is planning on producing 4,000 units in March and 3,700 in April. Each pole requires a half pound of material, which costs $1.20 per pound. The companys policy is to have enough material on hand to equal 10% of the next months production needs and to maintain a finished goods inventory equal to 25% of the next months production needs. What is the budgeted cost of purchases for March?Given the following information from Rowdy Enterprises direct materials budget, how much direct materials needs to be purchased?Each unit requires direct labor of 2.2 hours. The labor rate is $11.50 per hour and next years direct labor budget totals $834.900. How many units are included in the production budget for next year?How many units are estimated to be sold it Skyline. Inc., has a planned production of 900,000 units, a desired beginning inventory of 160,000 units, and a desired ending inventory of 100,000 units?Cash collections for Wax On Candles found that 60% of sales were collected in the month of the sale, 30% was collected the month after the sale, and 10% was collected the second month after the sale. Given the sales shown, how much cash will be collected in January and February?Nonnas Re-Appliance Store collects 55% of its accounts receivable in the month of sale and 40% in the month after the sale. Given the following sales, how much cash will be collected in February?Dream Big Pillow Co. pays 65% of its purchases in the month of purchase, 30% the month after the purchase, and 5% in the second month following the purchase. It made the following purchases at the end of 2017 and the beginning of 2018:Desiccate purchases direct materials each month. Its payment history shows that 70% is paid in the month of purchase with the remaining balance pad the month after purchase. Prepare a cash payment schedule for March if in January through March, it purchased $35,000, $37,000, and $39,000, respectively.What is the amount of budgeted cash payments if purchases are budgeted for $420,000 and the beginning and ending balances of accounts payable are $95,000 and $92,000, respectively?Halifax Shoes has 30% of its sales in cash and the remainder on credit. Of the credit sales, 65% is collected in the month of sale, 25% is collected the month after the sale, and 5% is collected the second month after the sale. How much cash will be collected in August if sales are estimated as $75,000 in June, $65,000 in July, and $90,000 in August?Cold X, Inc. uses this information when preparing their flexible budget: direct materials of $2 per unit, direct labor of $3 per unit, and manufacturing overhead of $1 per unit. Fixed costs are $35,000. What would be the budgeted amounts for 20,000 and 25,000 units?Using the provided budgeted information for production of 10,000 and 15,000 units, prepare a flexible budget for 17,000 units.The production cost for a waterproof phone case is $7 per unit and fixed costs are $23,000 per month. How much is the favorable or unfavorable variance If 5,500 units were produced for a total of $61,000?Lovely Wedding printing is budgeting sales of 32,000 units and already has 4,000 in beginning inventory. How many units must be produced to also meet the 6,000 units required in ending inventory?How many units are in beginning inventory if 32,000 units are budgeted for sales, 35,000 units are produced, and the desired ending inventory is 9,000 units?Barnstormer sells airplane accessories for $20 each. It expects sales of 120,000 units in quarter 1 and a 7% increase each subsequent quarter for the next 8 quarters. Prepare a sales budget by quarter for the first year.Rehydrator makes a nutrition additive and expects to sell 3,000 units in January, 2,000 in February, 2,500 in March, 2,700 in April. and 2,900 in May. The required ending inventory is 20% of the next months sales, and the beginning inventory on January 1 was 600 units. Prepare a production budget for the first four months of the year.Cloud Shoes manufactures recovery sandals and is planning on producing 12.000 units in March and 11,500 in April. Each sandal requires 1.2 yards if material, which costs $3.00 per yard. The companys policy is to have enough material on hand to equal 15% of next months production needs and to maintain a finished goods inventory equal to 20% of the next months production needs. What is the budgeted cost of purchases for March?Given the following information from Power Enterprises direct materials budget, how much direct materials needs to be purchased?Each unit requires direct labor of 4.1 hours. The labor rate is $13.75 per hour and next years production is estimated at 75,000 units. What is the amount to be included in next years direct labor budget?How many units are estimated to be sold if Kino, Inc., has planned production of 750,000 units, a desired beginning inventory of 30,000 units, and a desired ending inventory of 45,000 units?Cash collections for Renew Lights found that 65% of sales were collected in the month of sale, 25% was collected the month after the sale, and 10% was collected the second month after the sale. Given the sales shown, how much cash will be collected in March and April?My Aunts Closet Store collects 60% of its accounts receivable in the month of sale and 35% in the month after the sale. Given the following sales, how much cash will be collected in March?Gear Up Co. pays 65% of its purchases in the month of purchase, 30% in the month after the purchase, and 5% in the second month following the purchase. What are the cash payments if it made the following purchases in 2018?Drainee purchases direct materials each month. Its payment history shows that 65% is paid in the month of purchase with the remaining balance paid the month after purchase. Prepare a cash payment schedule for January using this data: in December through February, it purchased $22,000, $25,000, and $23,000 respectively.What is the amount of budgeted cash payments if purchases are budgeted for $190,500 and the beginning and ending balances of accounts payable are $21,000 and $25,000, respectively?Earthies Shoes has 55% of its sales in cash and the remainder on credit. Of the credit sales, 70% is collected in the month of sale, 15% is collected the month after the sale, and 10% is collected the second month after the sale. How much cash will be collected in June if sales are estimated as $75,000 in April, $65,000 in May, and $90,000 in June?Judges Gavel uses this information when preparing their flexible budget: direct materials of $3 per unit, direct labor of $2.50 per unit, and manufacturing overhead of $1.25 per unit. Fixed costs are $49,000. What would be the budgeted amounts for 33,000 and 35,000 units?Using the following budgeted information for production of 5,000 and 12,000 units, prepare a flexible budget for 9,000 units.The production cost for UV protective sunglasses is $5.50 per unit and fixed costs are $19,400 per month. How much is the favorable or unfavorable variance if 14,000 units were produced for a total of $97,000?Lens Junction sells lenses for $45 each and is estimating sales of 15,000 units in January and 18,000 in February. Each lens consists of 2 pounds of silicon costing $2.50 per pound, 3 oz of solution costing $3 per ounce, and 30 minutes of direct labor at a labor rate of $18 per hour. Desired inventory levels are: Â Prepare a sales budget, production budget. direct materials budget for silicon and solution, and a direct labor budget.The data shown were obtained from the financial records of Italian Exports, Inc., for March: Sales are expected to increase each month by 10%. Prepare a budgeted income statement.Echo Amplifiers prepared the following sales budget for the first quarter of 2018: It also has this additional information related to its expenses: Prepare a sales and administrative expense budget for each month in the quarter ending March 31, 2018.Prepare a budgeted income statement using the information shown.Spree Party Lights overhead expenses are: Prepare a manufacturing overhead budget if the number of units to produce for January,February, and March are 2,500. 3,000, and 2.700, respectively.Relevant data from the Poster Companys operating budgets are: Additional data: Capital assets were sold in January for $10,000 and $4,500 in May. Dividends of $4,500 were paid in February. The beginning cash balance was $60,359 and a required minimum cash balance is $59,000. Use this information to prepare a cash budget for the first two quarters of the year Fill in the missing information from the following schedules:Direct labor hours are estimated as 2,000 in Quarter 1; 2,100 in Quarter 2; 1,900 in Quarter 3; and 2,300 in Quarter 4. Prepare a manufacturing overhead budget using the information provided.Fitbands estimated sales are: What are the balances in accounts receivable for January, February, and March if 65% of sales is collected in the month of sale, 25% is collected the month after the sale, and 10% is second month after the sale?Sports Socks has a policy of always paying within the discount period and each of its suppliers provides a discount of 2% if paid within 10 days of purchase. Because of the purchase policy, 85% of its payments are made in the month of purchase and 15% are made the following month. The direct materials budget provides for purchases of $129,582 in November, $294,872 in December, $239,582 in January, and $234,837 in February. What is the balance in accounts payable for January 31, and February 28?Prepare a flexible budgeted income for 120,000 units using the following information from a static budget for 100,000 units:Before the year began, the following static budget was developed for the estimated sales of 100,000. Sales are sluggish and management needs to revise its budget. Use this information to prepare a flexible budget for 80,000 and 90,000 units of sales.Caribbean Hammocks currently sells 75.000 units at $50 per unit. Its expenses are: Management believes it can increase sales by 5,000 units for every $5 decrease in sales price. It also believes the additional sales will allow a decrease in direct material of $1 for each additional 5,000 units. Prepare a flexible budgeted income statement for 75,000-, 80,000-, and 85,000-unit sales.Total Pops data show the following information: New machinery will be added in April. This machine will reduce the labor required per unit and increase the labor rate for those employees qualified to operate the machinery. Finished goods inventory is required to be 20% of the next months requirements. Direct material requires 2 pounds per unit at a cost of $3 per pound. The ending inventory required for direct materials is 15% of the next months needs. In January, the beginning inventory is 3,000 units of finished goods and 4,470 pounds of material. Prepare a production budget, direct materials budget, and direct labor budget for the first quarter of the year.Identify the document that contains the information listed in these lines from the budgeted balance sheet shown. Cash Accounts receivable Raw materials inventory Computers Accounts payable

Page: [1][2][3][4]