Determine the difference in allocation between the two approaches. (Round answers to 0 decimal places, e.g. 1,225.)
Q: On what basis shall we allocate resources to Program A instead of Program B,” is the perennial state...
A: When compared to other types of budgeting, such as that used by typical private sector organisations...
Q: Everlast Manufacturing Company uses a predetermined manufacturing overhead rate based on a percentag...
A: Prime cost means the addition of direct material and direct labor and other direct expenses. Manufac...
Q: A, B and C are partners sharing profits and losses in the ratio of 3:2:1 after the bonus (20% of net...
A: A, B ,and C are the partners sharing profits and losses in the ratio of 3:2:1. So, A's Share of pro...
Q: i am doing chart of accounting general journal, 4/2 Purchased three computers and a printer from Bes...
A: Introduction: Journals: Recording of a business transactions in a chronological order. First step in...
Q: VaughnCompany issued 2400 shares of its $5 par value common stock in payment of its attorney's bill ...
A: Answer) Account Titles and Explanation Debit Credit Legal Expense $ 29,800 Com...
Q: Fees Eamed elsanne (meron, Capital Acumsaned Depreciution Bulding Enerson Company General Ledger UNA...
A: The adjustment entries are prepared to adjust the revenue and expenses of the current period.
Q: Transactions for Buyer and Seller Shore Co. sold merchandise to Blue Star Co. on account, $111,500, ...
A: Net Sales = Sales - Sales discount Sales discount = 2% Net sales = 100 - 2 = 98% Inventory purchase ...
Q: PROBLEM 2. Outlast Company's projected profit for the coming year follows: Per Unit Total P200,000 (...
A: cost volume profit analysis statement is prepared in order to find the impact that whenever there is...
Q: ermin company had 200,000 ordinary shares outstanding on January 1. In addition, as of January 1, t...
A: Solution Concept Basic earning per share =net income for common shareholder / weight...
Q: The Molding Department of Oriole Company has the following production data: beginning work in proces...
A: Unit conversion is a complete process that involves multi-tasking like multiplication or division by...
Q: 4/3 Paid the Gazette $200 to place an employment advertisement for an accounting clerk. how to solve...
A: Journal entry: It refers to the process of recording financial transactions incurred by the business...
Q: The following balances were the balances of accounts appearilg Iron And steel Merchant on 31" Decemb...
A: Journal entries shows the recording of the transactions during an accounting year and every transact...
Q: eBook Stockholders' Equity section of balance sheet Instructions Accounts and Amount Descriptions St...
A: Treasury stock shall nit be included while calculating shareholders equity
Q: Direct Labor Variances Re-Cycle Company manufactures commuter bicycles from recycled materials. T...
A:
Q: On January 1, 20X7, Phillips Corporation acquired 35 percent of the outstanding shares of Shell Corp...
A: The equity method of accounting shows the total investment in the associate co...
Q: Europa Inc lent its manager P1,000,000 at a lower rate of 3% interest per annum. What is the fringe ...
A: Fringe Benefit Tax For calculating the fringe benefit taxes in Philippines first to calculate the mo...
Q: A. Operating expenses are a function of: a. The cost of equity and the cost of debt b. The...
A: Operating Expenses: In the business world, an operational expenditure is a cost that a company incur...
Q: QUESTION 9 Frying Dutchman, Inc. had beginning Work-in-Process Inventory (WIP) of $8,000. It incurre...
A: Sales commission will not form part of cost of goods manufactured.
Q: Prepare a schedule showing a vertical analysis for 2022 and 20 SWIFTY CORPORATION Condensed Income S...
A: The question is based on the concept of Cost Accounting.
Q: alculate the overhead rate using activity based costing. (Round answers to 2 decimal places, e.g. 12...
A: EcoFabrics has budgeted overhead costs of $1,039,500. It has two main products - Wool and cotton. Th...
Q: A and B are partners who share profits and losses in a ratio of 1:2 with capital balance of 900k and...
A: Capital A = 900,000 B= 1,800,000 Admit C Capita = 900,000 Sharing ratio = 25%
Q: How much does she have to include in taxable income?
A: Answer: Any settlement that is received after damage is taxable other than recovery for emotional da...
Q: which of the following areas would an internal audit be required to have proficiency when carrying o...
A: Internal auditor be required to have proficiency when carrying out an audit of corporate governance ...
Q: JOURNALIZING AND POSTING PAYROLL ENTRIES Oxford Company has fiveemployees. All are paid on a monthly...
A: Payroll expenses are the total amount of salaries and wages which is paid to employees in exchange f...
Q: The following transactions relate to the General Fund of the City of Buffalo Falls for the year ende...
A:
Q: What is the total collection from sales? What is the total payments for merchandise purchase? What i...
A: We are given a trial balance of PBA Company which has ventured into business from January 2021. We a...
Q: A customer hands you $3,850 in cash and would like to purchase 14 prepaid cards of $275 each. The cu...
A: As per policy, POS register do not allows more than $ 2000 for a single transaction. Doing individua...
Q: Martinez Company's ending inventory includes the following items. Product Units Cost per Unit $ 58 M...
A: The lower cost and market value method considers the inventory value at 1. The Cost value 2.Market ...
Q: Moustapha transfers a capital asset with a $60,000 adjusted basis to X Corp in a Section 351 transac...
A: Total basis refers to the amount which is paid in securing as well as holding the particular investm...
Q: The current minimum wage is P400 per day. If minimum wage is scheduled to be adjusted every 2 years ...
A: The minimum wage is the least amount of wage which is guaranteed by the law enforceable in that regi...
Q: Requirement: For each of the following independent income-sharing agreements, prepare an income dist...
A: We are given various scenarios regarding payment of interest on capital, bonus and salaries to partn...
Q: View Policies Current Attempt in Progress Taylor Corporation issues 20,000 shares of $50 par value p...
A: The shares can be issued at par, premium or discount depending on the market value of shares.
Q: The following information has been obtained for Sheridan Corporation. 1. Prior to 2020, taxable inco...
A: Step 2 in solution.
Q: On January 1,2019, Jan and Kan have capital balances of P 2,000,000 and P 2,750,000, respectively. O...
A: "Since you have asked multiple questions, we will solve first question for you. If you want any spec...
Q: JOB ORDER COSTING WITH UNDER- AND OVERAPPLIED FACTORYOVERHEADM. Evans & Sons manufactures parts ...
A: A journal entry is a form of accounting entry that is used to report a business transaction in a com...
Q: Effectiveness/efficiency; ethics; writing Top management of Capital Services observed that the budge...
A: Efficiency is yield and measured by a ratio of output of input. Efficiency = Actual Output/Actual In...
Q: A new homeowner, Ms. Dee Young, needs to decide whether to install R-11 or R-19 insulation in the at...
A: answers:- Initial cost of R-19 = 0.05 * 1500 = 75 Annual savings of R-19 = 0.1 * 410 = 41 FW o...
Q: Timpano Communications Inc. reported the following shareholder's equity information on December 31, ...
A: Stock transactions are an important part which comprises of the changes in the capital structure (al...
Q: Assuming World Data is a resident foreign corporation, what is the income tax payable for the curren...
A: A tax is a compulsory charge paid to the government by everyone who is generating any kind of income...
Q: Gelato Company manufactures and sells an ice spoon that has seasonal variations in demand, with peak...
A: Budgeting - Budgeting is the process of estimating future operations based on past performance. % ar...
Q: Required information Use the following information for the Exercises below. [The following informati...
A: "" Since you have posted a question with multiple sub-parts, we will solve first three sub-parts for...
Q: FIXED ASSETS DEPRECIATION (Use Straight Line Method of Depreciation) Date of Purchase Estimated Acqu...
A: Depreciation is a dimunition [ reduction] in the value of an asset o...
Q: Liquidity Ratios 2020 2019 Current Ratio 1.06 1.26 P254,511,000| P239,957,000| P248,357,000 P196,719...
A: 1) Current ratio is decreasing from 1.26 to 1.06 from 2019 to 2020 which shows the liquidity of the ...
Q: a) Ace Company stockholder's equity at the end of 2015 is shown in the table below. Determine the nu...
A: Ordinary share capital means the shares having the voting rights in the entity.
Q: Which of the following statements is true with regard to activity-based costing? Multiple Cholce Act...
A: Activity-based costing is a method of costing that identify activities in an business and assigns th...
Q: What is the difference between callable and putable bonds?
A: Bonds are debt instruments issued by a company that borrows from its lenders. They are issued at a f...
Q: Tamarisk Inc is a company that manufactures and sells a single product. Unit sales for each of the ...
A: Profit Margin: To determine the extent to which a corporation or an economic activity produces money...
Q: Date of Note Interest Maturity Date June 10 July 14 April 27
A: Interest expense refers to those expense which is paid by an individual or company on the amount bor...
Q: Problem 4: A heavy planner was purchased 12 years ago for P 50,000 with no salvage value. As the li...
A: 1. Depreciation Expenses - Depreciation Expenses are the expense incurred on the wear and tear of th...
Q: Which of the following is not an objective of product costing systems? a. To assist in the preparat...
A: Solution Product costing system are used to assign a cost to a manufactured product.
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
- Brees, Inc., a manufacturer of golf carts, has just received an offer from a supplier to provide 2,600 units of a component used in its main product. The component is a track assembly that is currently produced internally. The supplier has offered to sell the track assembly for 66 per unit. Brees is currently using a traditional, unit-based costing system that assigns overhead to jobs on the basis of direct labor hours. The estimated traditional full cost of producing the track assembly is as follows: Prior to making a decision, the companys CEO commissioned a special study to see whether there would be any decrease in the fixed overhead costs. The results of the study revealed the following: 3 setups1,160 each (The setups would be avoided, and total spending could be reduced by 1,160 per setup.) One half-time inspector is needed. The company already uses part-time inspectors hired through a temporary employment agency. The yearly cost of the part-time inspectors for the track assembly operation is 12,300 and could be totally avoided if the part were purchased. Engineering work: 470 hours, 45/hour. (Although the work decreases by 470 hours, the engineer assigned to the track assembly line also spends time on other products, and there would be no reduction in his salary.) 75 fewer material moves at 30 per move. Required: 1. Ignore the special study, and determine whether the track assembly should be produced internally or purchased from the supplier. 2. Now, using the special study data, repeat the analysis. 3. Discuss the qualitative factors that would affect the decision, including strategic implications. 4. After reviewing the special study, the controller made the following remark: This study ignores the additional activity demands that purchasing would cause. For example, although the demand for inspecting the part on the production floor decreases, we may need to inspect the incoming parts in the receiving area. Will we actually save any inspection costs? Is the controller right?San Mateo Optics, Inc., specializes in manufacturing lenses for large telescopes and cameras used in space exploration. As the specifications for the lenses are determined by the customer and vary considerably, the company uses a job-order costing system. Manufacturing overhead is applied to jobs on the basis of direct labor hours, utilizing the absorption- or full-costing method. San Mateos predetermined overhead rates for 20x1 and 20x2 were based on the following estimates. Jim Cimino, San Mateos controller, would like to use variable (direct) costing for internal reporting purposes as he believes statements prepared using variable costing are more appropriate for making product decisions. In order to explain the benefits of variable costing to the other members of San Mateos management team, Cimino plans to convert the companys income statement from absorption costing to variable costing. He has gathered the following information for this purpose, along with a copy of San Mateos 20x1 and 20x2 comparative income statement. San Mateo Optics, Inc. Comparative Income Statement For the Years 20x1 and 20x2 San Mateos actual manufacturing data for the two years are as follows: The companys actual inventory balances were as follows: For both years, all administrative expenses were fixed, while a portion of the selling expenses resulting from an 8 percent commission on net sales was variable. San Mateo reports any over-or underapplied overhead as an adjustment to the cost of goods sold. Required: 1. For the year ended December 31, 20x2, prepare the revised income statement for San Mateo Optics, Inc., utilizing the variable-costing method. Be sure to include the contribution margin on the revised income statement. 2. Describe two advantages of using variable costing rather than absorption costing. (CMA adapted)Handy Leather, Inc., produces three sizes of sports gloves: small, medium, and large. A glove pattern is first stencilled onto leather in the Pattern Department. The stenciled patterns are then sent to the Cut and Sew Department, where the glove is cut and sewed together. Handy Leather uses the multiple production department factory overhead rate method of allocating factory overhead costs. Its factory overhead costs were budgeted as follows: The direct labor estimated for each production department was as follows: Direct labor hours are used to allocate the production department overhead to the products. The direct labor hours per unit for each product for each production department were obtained from the engineering records as follows: a. Determine the two production department factory overhead rates. b. Use the two production department factory overhead rates to determine the factory overhead per unit for each product.
- 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?Mott Company recently implemented a JIT manufacturing system. After one year of operation, Heidi Burrows, president of the company, wanted to compare product cost under the JIT system with product cost under the old system. Motts two products are weed eaters and lawn edgers. The unit prime costs under the old system are as follows: Under the old manufacturing system, the company operated three service centers and two production departments. Overhead was applied using departmental overhead rates. The direct overhead costs associated with each department for the year preceding the installation of JIT are as follows: Under the old system, the overhead costs of the service departments were allocated directly to the producing departments and then to the products passing through them. (Both products passed through each producing department.) The overhead rate for the Machining Department was based on machine hours, and the overhead rate for assembly was based on direct labor hours. During the last year of operations for the old system, the Machining Department used 80,000 machine hours, and the Assembly Department used 20,000 direct labor hours. Each weed eater required 1.0 machine hour in Machining and 0.25 direct labor hour in Assembly. Each lawn edger required 2.0 machine hours in Machining and 0.5 hour in Assembly. Bases for allocation of the service costs are as follows: Upon implementing JIT, a manufacturing cell for each product was created to replace the departmental structure. Each cell occupied 40,000 square feet. Maintenance and materials handling were both decentralized to the cell level. Essentially, cell workers were trained to operate the machines in each cell, assemble the components, maintain the machines, and move the partially completed units from one point to the next within the cell. During the first year of the JIT system, the company produced and sold 20,000 weed eaters and 30,000 lawn edgers. This output was identical to that for the last year of operations under the old system. The following costs have been assigned to the manufacturing cells: Required: 1. Compute the unit cost for each product under the old manufacturing system. 2. Compute the unit cost for each product under the JIT system. 3. Which of the unit costs is more accurate? Explain. Include in your explanation a discussion of how the computational approaches differ. 4. Calculate the decrease in overhead costs under JIT, and provide some possible reasons that explain the decrease.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?
- Lansing. Inc., provided the following data for its two producing departments: Machine hours are used to assign the overhead of the Molding Department, and direct labor hours are used to assign the overhead of the Polishing Department. There are 30,000 units of Form A produced and sold and 50,000 of Form B. Required: 1. Calculate the overhead rates for each department. 2. Using departmental rates, assign overhead to live two products and calculate the overhead cost per unit. How does this compare with the plantwide rate unit cost, using direct labor hours? 3. What if the machine hours in Molding were 1,200 for Form A and 3,800 for Form B and the direct labor hours used in Polishing were 5,000 and 15,000, respectively? Calculate the overhead cost per unit for each product using departmental rates, and compare with the plantwide rate unit costs calculated in Requirement 2. What can you conclude from this outcome?Eclipse Motor Company manufactures two types of specialty electric motors, a commercial motor and a residential motor, through two production departments, Assembly and Testing. Presently, the company uses a single plantwide factory overhead rate for allocating factory overhead to the two products. However, management is considering using the multiple production department factory overhead rate method. The following factory overhead was budgeted for Eclipse: Direct machine hours were estimated as follows: In addition, the direct machine hours (dmh) used to produce a unit of each product in each department were determined from engineering records, as follows: a. Determine the per-unit factory overhead allocated to the commercial and residential motors under the single plantwide factory overhead rate method, using direct machine hours as the allocation base. b. Determine the per-unit factory overhead allocated to the commercial and residential motors under the multiple production department factory overhead rate method, using direct machine hours as the allocation base for each department. c. Recommend to management a product costing approach, based on your analyses in (a) and (b). Support your recommendation.Salley is developing material and labor standards for her company. She finds that it costs $0.55 per pound of material per widget. Each widget requires 6 pounds of material per widget. Salley is also working with the operations manager to determine what the standard labor cost is for a widget. Upon observation, Salley notes that it takes 3 hours in the assembly department and 1 hour in the finishing department to complete one widget. All employees are paid $10.50 per hour. A. What is the standard materials cost per unit for a widget? 8. What is the standard labor cost per unit for a widget?
- Geneva, Inc., makes two products, X and Y, that require allocation of indirect manufacturing costs. The following data were compiled by the accountants before making any allocations: The total cost of purchasing and receiving parts used in manufacturing is 60,000. The company uses a job-costing system with a single indirect cost rate. Under this system, allocated costs were 48,000 and 12,000 for X and Y, respectively. If an activity-based system is used, what would be the allocated costs for each product?Big Mikes, a large hardware store, has gathered data on its overhead activities and associated costs for the past 10 months. Nizam Sanjay, a member of the controllers department, believes that overhead activities and costs should be classified into groups that have the same driver. He has decided that unloading incoming goods, counting goods, and inspecting goods can be grouped together as a more general receiving activity, since these three activities are all driven by the number of receiving orders. The 10 months of data shown below have been gathered for the receiving activity. Required: 1. Prepare a scattergraph, plotting the receiving costs against the number of purchase orders. Use the vertical axis for costs and the horizontal axis for orders. 2. Select two points that make the best fit, and compute a cost formula for receiving costs. 3. Using the high-low method, prepare a cost formula for the receiving activity. 4. Using the method of least squares, prepare a cost formula for the receiving activity. What is the coefficient of determination?Silven Company has identified the following overhead activities, costs, and activity drivers for the coming year: Silven produces two models of cell phones with the following expected activity demands: 1. Determine the total overhead assigned to each product using the four activity drivers. 2. Determine the total overhead assigned to each model using the two most expensive activities. The costs of the two relatively inexpensive activities are allocated to the two expensive activities in proportion to their costs. 3. Using ABC as the benchmark, calculate the percentage error and comment on the accuracy of the reduced system. Explain why this approach may be desirable.
