An individual named Su filed a lawsuit against a distributor company Sc, for distributing “unreasonably dangerous product”- a utility lighter. The person S, who lived with her four daughters A, V, Je, and Ja, alleged that the lighter she bought from Sc company was “unreasonably dangerous” as it caused her three-year-old daughter Je’s death. To find: The expectation applied to this case is of Su or Je.

Question

Belle Garments manufactures customized T-shirts for football teams. The business uses a perpetual inventory system and has a highly labour-intensive production process, so it assigns manufacturing overhead based on direct labour cost. The business operates at a profit margin of 33% on sales. Belle Garments expects to incur $2,205,000 of manufacturing overhead costs and estimated direct labour costs of $3,150,000 during 2025. At the end of December 2024, Belle Line Garments reported work in process inventory of $93,980 - Job FBT 101 - $51,000 & Job FBT 102 - $42,980 The following events occurred during January 2025. i) Purchased materials on account, $388,000. The purchase attracted freight charges of $4,000 ii) Incurred manufacturing wages of $400,000 iii) Requisitioned direct materials and used direct labour in manufacturing. Job # FBT 101 FBT 102 FBT 103 FBT 104 Direct Materials $70,220 97,500 105,300 117,000 iv) Issued indirect materials to production, $30,000. Direct Labour $61,200…

Answer 1

Question

Chapter 7, Problem 9BCP

(a)

Summary Introduction

Case summary: An individual named Su filed a lawsuit against a distributor company Sc, for distributing “unreasonably dangerous product”- a utility lighter. The person S, who lived with her four daughters A, V, Je, and Ja, alleged that the lighter she bought from Sc company was “unreasonably dangerous” as it caused her three-year-old daughter Je’s death.

To find:The expectation applied to this case is of Su or Je.

(b)

Summary Introduction

Case summary:

An individual Su filed a lawsuit against s distributor company Sc for distributing “unreasonably dangerous product”- a utility lighter. The person S, who lived with her four daughters A, V, Je, and Ja, alleged that the lighter she bought from Sc company was “unreasonably dangerous” as the lighter caused her three-year-old daughter Je’s death.

To Explain : How the court should rule.

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Belle Garments manufactures customized T-shirts for football teams. The business uses a perpetual inventory system and has a highly labour-intensive production process, so it assigns manufacturing overhead based on direct labour cost. The business operates at a profit margin of 33% on sales. Belle Garments expects to incur $2,205,000 of manufacturing overhead costs and estimated direct labour costs of $3,150,000 during 2025. At the end of December 2024, Belle Line Garments reported work in process inventory of $93,980 - Job FBT 101 - $51,000 & Job FBT 102 - $42,980 The following events occurred during January 2025. i) Purchased materials on account, $388,000. The purchase attracted freight charges of $4,000 ii) Incurred manufacturing wages of $400,000 iii) Requisitioned direct materials and used direct labour in manufacturing. Job # FBT 101 FBT 102 FBT 103 FBT 104 Direct Materials $70,220 97,500 105,300 117,000 iv) Issued indirect materials to production, $30,000. Direct Labour $61,200…

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