(Assume that selling and administrative expenses are associated with goods sold.) Levine sells its products for $216 per unit. Required a. Prepare income statements based on absorption costing for Year 2 and Year 3. b. Since Levine sold the same number of units in Year 2 and Year 3, why did net income increase in Year 3? d. Determine the costs of ending inventory for Year 3.
Q: Journal entries 3 Bought goods on credit from Smart Warehouse RM10,100. 4 Sold goods for cash…
A: A journal entry is a type of accounting entry that is used to reflect a business transaction in a…
Q: On May 1, Boyz Security Services rented office space and paid two month's rent in advance in the…
A: Journal Entries is the method to record transactions within the accounting records of the business.…
Q: 3 Bought goods on credit from Smart Warehouse RM10,100. 4 Sold goods for cash RM3,400. 5 Paid…
A: Introduction: Journals: Recording of a business transactions in a chronological order. First step in…
Q: On January 1, 2010, Ayala Corporation acquired 80% of ordinary shares of Globe Company at fair value…
A: Depreciation expense is the portion of a fixed asset that is assumed to be used in the current…
Q: with inte bonds of Similar
A: The face value of bonds is $ 1,000,000 and market rate of interest of such…
Q: come Statement accounts are closed at which stage of the accounting process? Multiple Cholce At the…
A: Solution: Income statements accounts are temporary accounts that are closed to income statement at…
Q: Unit VIII question 2
A: Material cost variances may be caused due purchase price, a business is paying less than the…
Q: Paul White is preparing a direct labor budget. His sales budget shows total sales units of 15900 and…
A: The budgeted direct labor cost is calculated as the number of direct labor hours multiplied by the…
Q: 9) Omanı Company reported equity of RO 130,000 on March 1. During the month, The Company generated…
A: Formula: Ending equity balance = Beginning balance + Additional investments + Net income - Dividends…
Q: teddy’s Pillow’s had beginning net fixed assets of $461 and ending net fixed assets of $530. Assets…
A: The net amount spent by a corporation to acquire fixed assets over a period of time is referred to…
Q: Compute the standard cost of the ingredients for one gallon of the nutrition drink. (Round…
A: Actual Input Material Required for 100 Gallon Batch Price ounce of lime kool drink 2000 $…
Q: 9) Omani Company reported equity of RO 130,000 on March 1. During the month, The Company generated…
A: Here in this question, we are required to calculate equity at the end of the month. Equity at the…
Q: A company has $1,357 in inventory, $4,800 in net fixed assets, $646 in accounts receivable, $286 in…
A: As per the accounting equation concept, total assets are equal to the total liabilities and equity.…
Q: Aljohn Company's year-end financial statements contained the following errors: 12.31.2021 12.31.2022…
A: given ending inventory understated for 12.31.2021 For P95,000 and overstated for 12.31.2022…
Q: Whispering has the following inventory data: Nov. 1 Inventory 28 units@$5.50 each Purchase 110 units…
A: Specific Identification Cost of Goods Available for Sale Cost of Goods Sold Ending Inventory…
Q: On Septèmber 1, 2021, Trinoma Entertainment borrowed P24,000,000 cash to fund à new Fun Park. The…
A: Journal entry shows the recording of transactions during an accounting year and every transaction…
Q: Silver Company makes a product that is very popular as a Mother's Day gift. Thus, peak sales occur…
A: When sales is made on credit , cash receipts are recorded as and when the cash is collected.
Q: Burger Chef acquired a delivery truck on March 1, 2021, for $31,600. The company estimates a…
A: Depreciation expense is reduction in the value of asset in that period ( how much value of asset is…
Q: PROBLEM 6-5 Comprehensive You have been asked by a client to audit the financial statements of…
A: As per the norms of Bartleby, in case the question has multiple sub parts, only the first 3 subparts…
Q: Unit v question 15
A: Journal entry is a process of recording and classifying business transactions into books of accounts…
Q: Presented below is information related to copyrights owned by Carla Vista Company at December 31,…
A: A journal entry is an accounting entry which is used to record a commercial transaction in the…
Q: Beagle Corporation has 28,000 shares of $10 par common stock outstanding and 15,000 shares of $100…
A: Annual Dividend to Preferred shareholders = No. of preferred share outstanding x Par value per share…
Q: Unit VIII question 3 part a
A: When the actual price paid for materials used in manufacturing differs from the normal price for the…
Q: Unit VI question 2
A: Solution:- 1-a)Computation of net income if Increase selling price by 10% with no change in total…
Q: Sheffield Landscaping began construction of a new plant on December 1,2020. On this date, the…
A: An asset is not just valued at the amount paid to acquire it but all the expenses that incur with…
Q: Activity Machin Number Number Direct la
A: Plantwide Overhead rate is equal to Total Budgeted Overhead divided by Total direct labour hours.
Q: When materials costs differ significantly among products in a value stream, the valuestream product…
A: In contrast to traditional costing, value stream costing is an accounting technique for tracking…
Q: AA Company reported inventory on December 31, 2018 at P6,000,000 based on a physical count of goods…
A: FOB Destination means that the title to the goods passes from the owner to the buyer when the goods…
Q: ?Which one of the following is an organization sustaining activity Packaging of units a O None of…
A: Introduction:- Organization sustaining activities are those activities which maintains the operation…
Q: What is Sales Mix and why is it used in retail operations?
A: Sales mix is the proportion of each product sold by a company as a percentage of its total sales.…
Q: Dec. 31, 20Y2 Dec. 31, 20Y1 Accounts receivable $30,000 $29,200 Inventory 75,800 76,500 Accounts…
A: Cash Flow Statement (Indirect Method) For the year ended December 31, 20Y2 Cash Flow from…
Q: On January 1, 2022, Frank Co. and Richard, Inc. combined. As of this date, the fair values of
A: Richard acquired 60% of Frank. So now Frank is subsidiary of Richard…
Q: ,000)$, its e: vage value is
A: Explanation - 1. Depreciation Expenses - This is an expense booked on the income statement debit…
Q: On January 1 , 2021, Gray Co. issued its 10%, 4-year convertible debt instrument with a face amount…
A: Above question is based on Compounded Financial Instrument. In these type of instrument, two…
Q: Unit VI question 5
A: The contribution margin is calculated as difference between sales and variable costs. Break even…
Q: Project Alpha requires an immediate investment of $16,000 and an additional investment of $12,000…
A: Net Present Value = Present Value of Cash Inflows - Present Value of Cash Outflows
Q: Problem 7 Aespa Company leased equipment from Naevis Company on July 1, 2021 for eight-year period…
A: A lease is an implied or written agreement specifying the conditions under which a lessor accepts to…
Q: Lee Manufacturing Corporation was incorporated on January 3, 2021. The corporation's financial…
A: 1. Analysis for intangible asset accounts: Patents: Particulars Amount Unadjusted Balances…
Q: (1) a posting to a general ledger account. (2) a posting to a subsidiary ledger account. (3) that no…
A: GIVEN Shown below is a page from cash payments journal. Using the cash payments journal below,…
Q: 4. a) The primary responsibility for the prevention and detection of fraud rests with both those…
A: “Since you have asked multiple questions, we will solve the first question for you. If you want any…
Q: What is the cost of the equipment to be recorded by Faith Logistics Corporation on August 1, 2022?…
A: On August 1, 2022, the company acquired a service vehicle for a total cash price of P650,000 with…
Q: On June 30, 2022, the remaining bonds were reacquired at 106 plus accrued interest and refunded with…
A: The carrying amount of bonds is the value of the bond at the last date of the financial year. It can…
Q: Unit VI question 12 part a
A: Contribution margin refers to the difference between sales value and variable cost. After deducting…
Q: Liab. + Equity Rev. − Exp. = Net Inc. A. NA = NA
A: If company bonds mature, then the cash and bond liability decrease by 50000. In statement cash flow…
Q: Kitt Company borrows $800,000 from Neville Capital by issuing an 8-year (96-month), 12% note…
A: GIVEN Kitt Company borrows $800,000 from Neville Capital by issuing an 8-year (96-month), 12% note…
Q: The going concern assumption is inappropriate when: Select one: liquidation appears likely. market…
A: As per going concern assumption, a business will remain active for foreseeable future. It means that…
Q: Budgeted units produced and sold Actual selling price Sales volume variance for units sold Sales…
A: Standard costing in simple terms can be defined as a system in which the standard costs and revenues…
Q: ue added, several adjustments are made to after tax operating profit that
A: Economic value added = net operating profit after tax -(capital*WACC)
Q: Company is subject to an income tax rate of 30%. It has the provided the following data on December…
A: Ratio Analysis is a method of evaluation of the financial performances of an organisation during a…
Q: 3. What is the investment in Two Company common stock at year-end? 4. What is the recovery of…
A: On December 31, 2020, Dreamer Company reported as Available-for-sale securities: Particulars Qty…
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
- SmokeCity, Inc., manufactures barbeque smokers. Based on past experience, SmokeCity has found that its total annual overhead costs can be represented by the following formula: Overhead cost = 543,000 + 1.34X, where X equals number of smokers. Last year, SmokeCity produced 20,000 smokers. Actual overhead costs for the year were as expected. Required: 1. What is the driver for the overhead activity? 2. What is the total overhead cost incurred by SmokeCity last year? 3. What is the total fixed overhead cost incurred by SmokeCity last year? 4. What is the total variable overhead cost incurred by SmokeCity last year? 5. What is the overhead cost per unit produced? 6. What is the fixed overhead cost per unit? 7. What is the variable overhead cost per unit? 8. Recalculate Requirements 5, 6, and 7 for the following levels of production: (a) 19,500 units and (b) 21,600 units. (Round your answers to the nearest cent.) Explain this outcome.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?Roper Furniture manufactures office furniture and tracks cost data across their process. The following are some of the costs that they incur. Classify these costs as fixed or variable costs, and as product costs or period costs. Wood used to produce desks ($125,00 per desk) Production labor used to produce desks ($15 per hour) Production supervisor salary ($45,000 per year) Depreciation on factory equipment ($60,000 per year) Selling and administrative expenses ($45,000 per year) Rent on corporate office ($44,000 per year) Nails, glue, and other materials required to produce desks (varies per desk) Utilities expenses for production facility Sales staff commission (5% of gross sales)
- Natur-Gro, Inc., manufactures composters. Based on past experience, Natur-Gro has found that its total annual overhead costs can be represented by the following formula: Overhead cost = 264,000 + 1.42X, where X equals number of composters. Last year, Natur-Gro produced 30,000 composters. Actual overhead costs for the year were as expected. Total overhead for per unit was a. 1.42 b. 8.80 c. 11.63 d. 10.22Cost Classification Loring Company incurred the following costs last year: Required: 1. Classify each of the costs using the following table format. Be sure to total the amounts in each column. Example: Direct materials, 216,000. 2. What was the total product cost for last year? 3. What was the total period cost for last year? 4. If 30,000 units were produced last year, what was the unit product cost?Hart Manufacturing makes three products. Each product requires manufacturing operations in three departments: A, B, and C. The labor-hour requirements, by department, are as follows: During the next production period the labor-hours available are 450 in department A, 350 in department B, and 50 in department C. The profit contributions per unit are 25 for product 1, 28 for product 2, and 30 for product 3. a. Formulate a linear programming model for maximizing total profit contribution. b. Solve the linear program formulated in part (a). How much of each product should be produced, and what is the projected total profit contribution? c. After evaluating the solution obtained in part (b), one of the production supervisors noted that production setup costs had not been taken into account. She noted that setup costs are 400 for product 1, 550 for product 2, and 600 for product 3. If the solution developed in part (b) is to be used, what is the total profit contribution after taking into account the setup costs? d. Management realized that the optimal product mix, taking setup costs into account, might be different from the one recommended in part (b). Formulate a mixed-integer linear program that takes setup costs provided in part (c) into account. Management also stated that we should not consider making more than 175 units of product 1, 150 units of product 2, or 140 units of product 3. e. Solve the mixed-integer linear program formulated in part (d). How much of each product should be produced and what is the projected total profit contribution? Compare this profit contribution to that obtained in part (c).
- Income Statements under Absorption and Variable Costing In the coming year, Kalling Company expects to sell 28,700 units at 32 each. Kallings controller provided the following information for the coming year: Required: 1. Calculate the cost of one unit of product under absorption costing. 2. Calculate the cost of one unit of product under variable costing. 3. Calculate operating income under absorption costing for next year. 4. Calculate operating income under variable costing for next year.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?Step Costs, Relevant Range Bellati Inc. produces large industrial machinery. Bellati has a machining department and a group of direct laborers called machinists. Each machinist can machine up to 500 units per year. Bellati also hires supervisors to develop machine specification plans and oversee production within the machining department. Given the planning and supervisory work, a supervisor can oversee, at most, three machinists. Bellatis accounting and production history shows the following relationships between number of units produced and the annual costs of supervision and materials handling (by machinists): Required: 1. Prepare a graph that illustrates the relationship between direct labor cost and number of units produced in the machining department. (Let cost of direct labor be the vertical axis and number of units be the horizontal axis.) Would you classify this cost as a strictly variable cost, a fixed cost, or a step cost? 2. Prepare a graph that illustrates the relationship between the cost of supervision and the number of units produced. (Let cost of supervision be the vertical axis and number of units be the horizontal axis.) Would you classify this cost as a strictly variable cost, a fixed cost, or a step cost? 3. Suppose that the normal range of production is between 1,400 and 1,500 units and that the exact number of machinists is currently hired to support this level of activity. Further suppose that production for the next year is expected to increase by an additional 500 units. What is the increase in the cost of direct labor? Cost of supervision?
- Variable-Costing and Absorption-Costing Income Borques Company produces and sells wooden pallets that are used for moving and stacking materials. The operating costs for the past year were as follows: During the year, Borques produced 200,000 wooden pallets and sold 204,300 at 9 each. Borques had 8,200 pallets in beginning finished goods inventory; costs have not changed from last year to this year. An actual costing system is used for product costing. Required: 1. What is the per-unit inventory cost that is acceptable for reporting on Borquess balance sheet at the end of the year ? How many units are in ending inventory? What is the total cost of ending inventory? 2. Calculate absorption-costing operating income. 3. CONCEPTUAL CONNECTION What would the per-unit inventory cost be under variable costing? Does this differ from the unit cost computed in Requirement 1? Why? 4. Calculate variable-costing operating income. 5. Suppose that Borques Company had sold 196,700 pallets during the year. What would absorption-costing operating income have been? Variable-costing operating income?Ellerson Company provided the following information for the last calendar year: During the year, direct materials purchases amounted to 278,000, direct labor cost was 189,000, and overhead cost was 523,000. During the year, 100,000 units were completed. Refer to Exercise 2.21. Last calendar year, Ellerson recognized revenue of 1,312,000 and had selling and administrative expenses of 204,600. Required: 1. What is the cost of goods sold for last year? 2. Prepare an income statement for Ellerson for last year.Cicleta Manufacturing has four activities: receiving materials, assembly, expediting products, and storing goods. Receiving and assembly are necessary activities; expediting and storing goods are unnecessary. The following data pertain to the four activities for the year ending 20x1 (actual price per unit of the activity driver is assumed to be equal to the standard price): Required: 1. Prepare a cost report for the year ending 20x1 that shows value-added costs, non-value-added costs, and total costs for each activity. 2. Explain why expediting products and storing goods are non-value-added activities. 3. What if receiving cost is a step-fixed cost with each step being 1,500 orders whereas assembly cost is a variable cost? What is the implication for reducing the cost of waste for each activity?