The fields in yellow require an answer. Thank you. PR 2-5A Flow of costs and income statementObj. 2Ginocera Inc. is a designer, manufacturer, and distributor of custom gourment kitchen knives. A newkitchen knife series called the Kitchen Ninja was released for production in early 20Y8. In January, thecompany spent $600,000 to develop a late-night advertising infomercial for the new product. During20Y8, the company spent an additional $1,400.000 promoting the product through these infomercials,and $800,000 in legal costs. The knives were ready for manufacture on January 1, 20Y8.Ginocera uses job order costing to accumulate costs associated with the Kitchen Ninja Knife.The unit direct materials cost for the knife is:Hardened steel blanks (used for knife shaft and blade) $4.00Wood (for handle)1.50Packaging0.50The production process is straightforward. First, the hardened steel blanks, which are purchaseddirectly from a raw material supplier, are stamped into a single piece of metal that includes boththe blade and the shaft. The stamping machine requires one hour per 250 knives.After the knife shafts are stamped, they are brought to an assembly area where an employeeattaches the handle to the shaft and packs the knife into a decorative box. The direct labor costis $0.50 per unit.The knives are sold to stores. Each store is given promotional materials, such as posters andaisle displays. Promotional materials cost $60 per store. In addition, shipping costs average $0.20per knife.Total completed production was 1,200,000 units during the year. Other information is as follows:Number of customers (stores)Number of knives sold60,0001,120,000$16Wholesale price (to store) per knifeFactory overhead cost is applied to jobs at the rate of $800 per stamping machine hourafter the knife blanks are stamped. There were an additional 25,000 stamped knives, handles,and cases in process and waiting to be assembled on December 31, 2018.Instructions1. Prepare an annual income statement for the Kitchen Ninja knife series, including supportingcomputations, from the information provided.2. Determine the balances in the work in process and finished goods inventories for the KitchenNinja knife series on December 31, 20Y8. Ginocera, Inc.Income StatementFor the Year Ended December 31, 2016$SalesCost of goods soldGross profitSelling and administrative expenses:Sales commission expensePromotion and advertising expenseTotal selling and administrative expeIncome from operations#DIV/0!#DIV/0!#DIV/0!Number of units soldWholesale price per unitsSalesCommission rateSales commisssion expenseUnits producedDirect materialsDirect laborFactory overheadTotal cost of units producedCost per unitUnits soldCost of goods soldFinished goods inventory balanceWIP inventory balance$$#DIV/0!#DIV/0!#DIV/0!#DIV/0!#DIV/0!#DIV/0!WIP unitsUnits producedDM unit costDL unit costFOH RateUnits produced per machine hourper machine hour

Income Statement: Company's income and expenditures along with profit or loss during the…

Ginocera Inc. is a designer, manufacturer, and distributor of custom gourment kitchen knives. A new kitchen knife series called the Kitchen Ninja was released for production in early 20Y8. In January, the company spent $600,000 to develop a late-night advertising infomercial for the new product. During 20Y8, the company spent an additional $1,400,000 promoting the product through these infomercials, and $800,000 in legal costs. The knives were ready for manufacture on January 1, 20Y8. Ginocera uses job order costing to accumulate costs associated with the Kitchen Ninja Knife. The unit direct materials cost for the knife is: Hardened steel blanks (used for knife shaft and blade) $4.00 Wood (for handle) 1.50 Packaging 0.50 The production process is straightforward. First, the hardened steel blanks, which are purchased directly from a raw material supplier, are stamped into a single piece of metal that includes both the blade and the shaft. The stamping machine requires one hour per 250 knives. After the knife shafts are stamped, they are brought to an assembly area where an employee attaches the handle to the shaft and packs the knife into a decorative box. The direct labor cost

Ginocera Inc. is a designer, manufacturer, and distributor of custom gourment kitchen knives. A new kitchen knife series called the Kitchen Ninja was released for production in early 20Y8. In January, the company spent $600,000 to develop a late-night advertising infomercial for the new product. During 20Y8, the company spent an additional $1,400,000 promoting the product through these infomercials, and $800,000 in legal costs. The knives were ready for manufacture on January 1, 20Y8. Ginocera uses job order costing to accumulate costs associated with the Kitchen Ninja Knife. The unit direct materials cost for the knife is: Hardened steel blanks (used for knife shaft and blade) $4.00 Wood (for handle) 1.50 Packaging 0.50 The production process is straightforward. First, the hardened steel blanks, which are purchased directly from a raw material supplier, are stamped into a single piece of metal that includes both the blade and the shaft. The stamping machine requires one hour per 250 knives. After the knife shafts are stamped, they are brought to an assembly area where an employee attaches the handle to the shaft and packs the knife into a decorative box. The direct labor cost

Financial & Managerial Accounting

14th Edition

ISBN:9781337119207

Author:Carl Warren, James M. Reeve, Jonathan Duchac

Publisher:Carl Warren, James M. Reeve, Jonathan Duchac

Chapter16: Job Order Costing

Section: Chapter Questions

Problem 16.5APR: Flow of costs and income statement Ginocera Inc. is a designer, manufacturer, and distributor of...

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Flow of costs and income statement Ginocera Inc. is a designer, manufacturer, and distributor of custom gourment kitchen knives. A new kitchen knife series called the Kitchen Ninja was released for production in early 20Y8. In January, the company spent 600,000 to develop a late-night advertising infomercial for the new product. During 20Y8, the company spent an additional 1,400,000 promoting the product through these infomercials, and 800,000 in legal costs. The knives were ready for manufacture on January 1, 20Y8. Ginocera uses a job order cost system to accumulate costs associated with the Kitchen Ninja Knife. The unit direct materials cost for the knife is: Hardened steel blanks (used (or knife shaft and blade) 4.00 Wood (for handle) 1.50 Packaging 0.50 The production process is straightforward. First, the hardened steel blanks, which are purchased directly from a raw material supplier, are stamped into a single piece of metal that includes both the blade and the shaft. The stamping machine requires one hour per 250 knives. After the knife shafts are stamped, they are brought to an assembly area where an employee attaches the handle to the shaft and packs the knife into a decorative box. The direct labor cost is 0.50 per unit. The knives are sold to stores. Each store is given promotional materials, such as posters and aisle displays. Promotional materials cost 60 per store. In addition, shipping costs average 0.20 per knife. Total completed production was 1,200,000 units during the Near. Other information is as follows: Number of customers (stores) 60,000 Number of knives sold 1,120,000 Wholesale price (to store) per knife 16 Factory overhead cost is applied to jolts at the rate of 800 per stamping machine hour after the knife blanks are stamped. There were an additional 25,000 stamped knives, handles, and cases in process and waiting to be assembled on December 51, 20Y8. Instructions 1. Prepare an annual income statement for the Kitchen Ninja knife series, including supporting calculations, from the information provided. 2. Determine the balances in the work in process and finished goods inventories for the Kitchen Ninja knife series on December 31, 20Y8.
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