Gant Accounting performs two types of services, Audit and Tax. Gant's overhead costs consist of computer support, $303000; and legal support, $151500. Information on the two services is: Tax Audit $50000 $100000 Direct labor cost 10000 40000 CPU minutes 800 200 Legal hours used Overhead applied to tax services using activity-based costing is O $272700. O $151500. O $181800. O $303000. ip

Gant Accounting performs two types of services, Audit and Tax. Gant's overhead costs consist of computer support, $303000; and legal support, $151500. Information on the two services is: Tax Audit $50000 $100000 Direct labor cost 10000 40000 CPU minutes 800 200 Legal hours used Overhead applied to tax services using activity-based costing is O $272700. O $151500. O $181800. O $303000. ip

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter7: Allocating Costs Of Support Departments And Joint Products

Section: Chapter Questions

Problem 30E: A company uses charging rates to allocate service department costs to the using departments. The...

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Gant Accounting performs two types of services, Audit and Tax. Gant’s overhead costs consist of computer support, $336000; and legal support, $168000. Information on the two services is: Audit Tax Direct labor cost $50000 $100000 CPU minutes 40000 10000 Legal hours used 200 800 Overhead applied to tax services using traditional costing is $336000. $168000. $201600. $302400.
Diaz and Associates incurred the following costs in completing a tax return for a large company. Diaz applies overhead at 50% of direct labor cost. Labor Hours Used Hourly Rate Partner 5 $500 Senior manager . 12 200 Staff accountants . 100 50 1. Prepare journal entries to record direct labor and the overhead applied. 2. Prepare the journal entry to record the cost of services provided. Assume the beginning Services in Process Inventory account has a zero balance.
Jamie Hopen, CPA, prepares tax returns. The production costs and the number of tax returns prepared for the month of September are as follows: Direct materials $ 200 CPA staff salaries 4,000 Overhead 1,800 Total $6,000 Number of tax returns 300What is the cost of services sold? a.$4,000 b.$200 c.$6,000 d.$1,800
Claire Corporation’s trial balance includes the following expenses: Raw materials used in production$5,500Raw materials purchased6,500General manager salary50,000Sales manager salary30,000Direct labor incurred130,000General liability insurance premium3,000Factory rent24,000Office lease18,000Factory utilities12,000Depreciation on factory equipment14,000 Assuming that this list represents all expenses for the year, what amount should Claire report as a period (non-product) expense? Select one: a. $74,000 b. $107,500 c. $83,000 d. $101,000
Mason, Durant, and Westbrook (MDW) is a tax services firm. The firm is located in Oklahoma City and employs 15 professionals and eight staff. The firm does tax work for small businesses and well-to-do individuals. The following data are provided for the last fiscal year. (The Mason, Durant, and Westbrook fiscal year runs from July 1 through June 30.) Required: 1. Prepare a statement of cost of services sold. 2. Refer to the statement prepared in Requirement 1. What is the dominant cost? Will this always be true of service organizations? If not, provide an example of an exception. 3. Assuming that the average fee for processing a return is 850, prepare an income statement for Mason, Durant, and Westbrook. 4. Discuss three differences between services and tangible products. Calculate the average cost of preparing a tax return for last year. How do the differences between services and tangible products affect the ability of MDW to use the last years average cost of preparing a tax return in budgeting the cost of tax return services to be offered next year?
A company uses charging rates to allocate service department costs to the using departments. The accountant compiled the following information on one of the service departments: If Department K plans to use 1,350 hours of the service departments service in the coming year, how much of the service departments cost is allocated to Department K? a. 3,375 b. 27,300 c. 26,325 d. 23,950
Sanchez & Vukmin, LLP, is a full-service accounting firm located near Chicago, Illinois. Last year, Sanchez provided tax preparation services to 500 clients. Total fixed costs were $265,000 with total variable costs of $180,000. Based on this information, complete this chart.
Classify each of the following actions as either being associated with the financial accounting information system (FS) or the cost management information system (CMS): a. Determining the total compensation of the CEO of a public company b. Issuing a quarterly earnings report c. Determining the unit product cost using TDABC d. Calculating the number of units that must be sold to break even e. Preparing a required report for the SEC f. Preparing a sales budget g. Using cost and revenue information to decide whether to keep, or drop, a product line h. Preparing an annual statement of financial position that conforms to generally accepted accounting principles (GAAP) i. Using cost and revenue information to decide whether to invest in a new production system or not j. Reducing costs by improving the overall quality of a product k. Using a debt-equity ratio and liquidity ratios from a balance sheet to assess the likelihood of bankruptcy l. Using a public companys financial statements to decide whether or not to buy its stock
Jamie Hopen, CPA, prepares tax returns. The production costs and the number of tax returns prepared for the month of September are as follows: Direct materials $ 200 CPA staff salaries 4,000 Overhead 1,800 Total $6,000 Number of tax returns 300What is the unit cost per tax return? a.$20.00 b.$0.67 c.$3.33 d.$15.00
Diaz and Associates incurred the following direct labor costs in completing tax services job for a client. Diaz applies overhead at 50% of direct labor cost. (Please see picture for rest of info).
Following items belong to the revenue, expenditure, human resources/payroll, production, or financing cycle. Classify each item based on the cycle it belongs to. a. Pay pay-as-you-earn (PAYE) payroll taxes b. Send material requisition to inventory c. Issue stock to investors d. Borrow money from the bank to purchase a new factory e. Complete receiving report f. Appoint replacement purchasing clerk g. Measure employee performance using a performance management system h. Choose suitable supplier of raw materials i. Ensure employees are up to date with the latest tax provisions j. Record personal and tax information for new employees
Please asssist me with accounting answers- i need practice, plase explain if applicable for the answers. (Not graded Question) Administrative salaries (non-factory) $140,000 Administrative rent (non-factory) 70,000 Advertising and promotion expense 82,000 Depreciation-administrative 44,000 Depreciation-factory 60,000 Depreciation-selling 34,000 Direct labor 350,000 Factory rent 36,000 Factory supplies used 24,000 Finished goods inventory (January 1) 114,000 Finished goods inventory (December 31) 104,000 Indirect material used 28,000 Indirect labor 38,000 Materials inventory (January 1) 26,000 Materials inventory (December 31) 40,000 Net delivered cost of materials purchased 276,000 Other factory overhead 52,000 Sales 1,690,000 Sales salaries expense 144,000 Work in process inventory (January 1) 36,000 Work in process inventory ( December 31) 62,000 Bourne Manufacturing CompanySchedule of Cost of Goods Manufactured and SoldFor…