Chapter 2 Cost-Concepts and Classification Problem 4 Classify ench of the following costs of Bug Company in two ways: (n) as variable (V) fixed costs (F); (b) as inventoriable costs (1) or period costs (P): (a) V or F (b)l or P Example: Direct labor 1. Wood used in bookcases 2. Machine depreciation based on mach. Hrs. 3. Fire insurance on factory equipment 4. Wiring used in radios 5. Indirect materials 6. Sales commissions 7. Bottles used to package liquid 8. Gasoline for a delivery truck 9. Straight-line depreciation of trucks used for delivery of sales to customers 10. Machine operator's hourly wages

Chapter 2 Cost-Concepts and Classification Problem 4 Classify ench of the following costs of Bug Company in two ways: (n) as variable (V) fixed costs (F); (b) as inventoriable costs (1) or period costs (P): (a) V or F (b)l or P Example: Direct labor 1. Wood used in bookcases 2. Machine depreciation based on mach. Hrs. 3. Fire insurance on factory equipment 4. Wiring used in radios 5. Indirect materials 6. Sales commissions 7. Bottles used to package liquid 8. Gasoline for a delivery truck 9. Straight-line depreciation of trucks used for delivery of sales to customers 10. Machine operator's hourly wages

Accounting Information Systems

11th Edition

ISBN:9781337552127

Author:Ulric J. Gelinas, Richard B. Dull, Patrick Wheeler, Mary Callahan Hill

Publisher:Ulric J. Gelinas, Richard B. Dull, Patrick Wheeler, Mary Callahan Hill

Chapter15: Integrated Production Processes (ipps)

Section: Chapter Questions

Problem 3P

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Activity-based costing for a service company Wells Fargo insurance Services (WFIS) is an insurance brokerage company that classified insurance products as either easy or difficult. Easy and difficult products were defined as follows: Easy: Electronic claims, few inquiries, mature product Difficult: Paper claims, complex claims to process, many inquiries, a new product with complex options The company originally allocated processing and service expenses on the basis of revenue. Under this traditional allocation approach, the product profitability report revealed the following: Easy Product Difficult Product Total Revenue 600 400 1,000 Processing and service expenses 420 280 700 Income from operations 180 120 300 Operating income margin 30% 30% 30% WFIS decided to use activity-based costing to allocate the processing and service expenses. The following activity-based costing analysis of the same data illustrates a much different profit picture for the two types of products: Easy Product Difficult Product Total Revenue 600 400 1,000 Processing and service expenses 183 517 700 Income from operations 417 (117) 300 Operating income margin 70% (29%) 30% Explain why the activity-based profitability report reveals different information from the traditional sales allocation report. Source: Dan Patras and Kevin Clancy, ABC in the Service Industry: Product Line Profitability at Acordia, Inc. As Easy as ABC Newsletter, issue 12. Spring 1993
Requirement 3. Classify each of the cost items (A-I) as an inventoriable cost or a period cost. Explain your answers. a. Lumber at Home Depot is a(n) ▼ inventoriable cost period cost since the lumber is ▼ an asset (inventory) held to sale to customers. presumed not to benefit future periods. The cost of lumber becomes part of ▼ cost of goods sold manufacturing overhead operating expenses when it is sold to customers. b. Electricity in an Apple manufacturing plant is a(n) ▼ inventoriable cost period cost . It is ▼ a direct cost an indirect cost of the product being produced. c. Depreciation on the shelving at Home Depot is a(n) ▼ inventoriable cost period cost . It is ▼ a cost of selling their products a cost of the products , not ▼ a cost of selling their products a cost of the products . d. Mileage for Rent a Nanny is a(n) ▼ inventoriable cost period cost since ▼ it has no inventory. it is a…
Ch. 4 Self Study Pg 316 Assign Indirect Cost to Individual Products or Services. Please solve the following based on the material given below. Per Unit Cost Information Floor Safe Business Direct Materials $20 Direct Labor 10 Manufacturing Overhead is Unkown Wall Safe Business Direct Materials $15 Direct Labor 15 Manufacturing Overhead is Unkown **Solve the Unkown Production Information Floor Safe Business Units Produced 35,000 Direct Labor Hours per unit 1 Wall Safe Business Units Produces 10,000 Direct Labor Houers per unit 1.5 ***600.000 is the estimated total manufacturing overhead Please solve these questions and explain 1) Compute the predetermined overhead rate per direct labor hour 2) How much of the total manufacturing overhead would be allocated to each product? 3) Compute the total manufacturing Cost per unit for each product.
Q.1 (a) Compare / contrast. Why are these two different? Inventoriable costs and period costs. Direct costs and indirect costs. Manufacturing costs and non-manufacturing costs. Period costs and product costs. Operating costs and non-operating costs. Q.1 (b) A client approached to Incredible Fabricating and Manufacturing for a one-time special order for Steel doors. These Steel doors are fabricated and manufactured to local clients regularly. The cost per unit information apply for deals to regular clients: Direct materials $1,982 Direct labor 810 Variable manufacturing overhead 1,296 Fixed manufacturing overhead 2,808 Total manufacturing costs 6,896 Markup (50%)…
CS_3_QA1_PIR: Req 1A: Compute the unit product cost for Year 1, Year 2, and Year 3. Unit Product Cost Year 1 Year 2 Year 3 Req 1B: Prepare an income statement for Year 1, Year 2, and Year 3. O’Brien Company Variable Costing Income Statement Year 1 Year 2 Year 3 Variable expenses: Total variable expenses 0 0 0 0 0 0 Fixed expenses: Total fixed expenses 0 0 0 $0 $0 $0
Table 3Costs:Factory Rent $ 373,000Factory Depreciation 150,000Factory Utilities 250,000Total $ 773,000Distribution of resource consumption:Activity Cost Pools TotalFixing Cutting PolishingFactory Rent 60% 20% 20% 100%Factory Depreciation 35% 20% 45% 100%Factory Utilities 20% 60% 20% 100% Use Table 3 to answer this question. XYZ Co uses an activity-based costing system with three activity cost pools. The company has provided the following data concerning its costs and its activity based costing system (Table 3). How much cost, in total, would be allocated in the first-stage allocation to the Polishing activity cost pool? Select one: a. $215,400 b. none of the given answer. c. $192,100 d. $254,600 e. $326,300
Requirement 1. Classify each cost as value-added, non-value-added, or in the gray area between. a. Materials and labor for servicing machine tools b. Rework costs c. Expediting costs caused by work delays d. Materials-handling costs e. Materials-procurement and inspection costs f. Preventive maintenance of equipment g. Breakdown maintenance of equipment Requirement 2. For any cost classified in the gray area, assume 96% is value-added and 4% is non-value-added. How much of the total of all seven costs is value-added and how much is non-value-added? Compute the total cost for the value-added and nonvalue-added costs, then compute what percentage of the total is value-added and how much is non-value-added. Total percent Total cost of total costs Value-added % Non-value-added % Total costs Requirement 3.…
UESTION 1 Cost Classification For each cost, identify it as: Variable or Fixed - A. B. Factory supervisor’s salary - A. B. Company president’s salary - A. B. Hourly wafes - A. B. eggs at a bakery - A. B. per-minute usage fees - A. B. depreciation - A. B. Pay-per view - A. B. taxes A. Variable B. fix
Ch. 3 MG Homework  Saved Help Save & Exit SubmitThe following four companies use a process cost system:Required:Treating each case independently, find the missing amount solana co. vista.co Ray Inc. Lindsay company conversion cost ? 235200 56350 ? direct labor 43000 ? 25300 13300 depreciation 2400 17400 ? 1500 manufacturing overhead 25500 143600 ? ? rent 16100 ? 10100 830 direct materials 89100 362050 39600 17050 supervisors salary 5200 19450 2700 1900 utilities ? 34200 8850 630
Q2) Product costing is the process of: A. accumulating the costs of a production process.B. assigning costs to a firm's products.C. placing a value on fixed assets owned by a producer.D. accumulating the costs of a production process AND assigning costs to a firm's products.
PROBLEM 2–25 Working with Incomplete Data from the Income Statement and Schedule of Cost ofGoods Manufactured [ LO4 , LO5 ]Supply the missing data in the following cases. Each case is independent of the others. Case1 2 3 4Schedule of Cost of Goods ManufacturedDirect materials . . . . . . . . . . . . . . . . . . . . . . . . . $4,500 $6,000 $5,000 $3,000Direct labor. . . . . . . . . . . . . . . . . . . . . . . . . . . . . ? $3,000 $7,000 $4,000Manufacturing overhead . . . . . . . . . . . . . . . . . . $5,000 $4,000 ? $9,000Total manufacturing costs . . . . . . . . . . . . . . . . . $18,500 ? $20,000 ?Beginning work in process inventory . . . . . . . . . $2,500 ? $3,000 ?Ending work in process inventory . . . . . . . . . . . ? $1,000 $4,000 $3,000Cost of goods manufactured . . . . . . . . . . . . . . . $18,000 $14,000 ? ?Income StatementSales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $30,000 $21,000 $36,000 $40,000Beginning fi nished goods inventory . . . . . . . .…
Info in images Question relating to the images: 3. Info in image "ACC PT2" 4. Compute the unadjusted cost of goods sold for the year. Do not include any underapplied or overapplied overhead in your answer. Unadjusted cost of goods sold [ ] 5. Assume that the $38,000 ending balance in Work in Process includes $8,600 of direct materials. Given this assumption, supply the information missing below: Direct materials $8,600 Direct labor [ ] Manufacturing overhead [ ] Work in process inventory $38,000