Pro-Leather Company is a manufacturer of leather cases for tablets. The following information pertains to operations during the 2020 calendar year. Sales Revenue $14,275,000 Direct Factory Labor Indirect Factory Labor Total Depreciation ' Total Utilities 2 3,952,600 1,232,250 400,000 525,000 Distribution & Customer Service Costs 76,800 Insurance on Plant & Equipment Property Taxes 3 Administrative Wages & Salaries Advertising Expenses 585,000 90,000 1,076,000 57,700 Sales Commission 6% of Sales Revenue "Of the total depreciation, 80% relates to factory plant & equipment and 20% relates to general and administrative costs. 2 Of the total utilities, 75% relates to production and 25% relates to general and administrative costs. 3 The property taxes should be shared: 85% production & 15% general & administrative costs The following additional information is also available: Inventory Data: 1/1/2020 Purchases 31/12/2020 Raw Materials $750,000 $4,330,000 $807,000 Indirect Materials 55,000 320,000 71,500 Work in Progress Finished Goods n/a n/a 924,000 1,720,200 1,115,400 1,142,600

Pro-Leather Company is a manufacturer of leather cases for tablets. The following information pertains to operations during the 2020 calendar year. Sales Revenue $14,275,000 Direct Factory Labor Indirect Factory Labor Total Depreciation ' Total Utilities 2 3,952,600 1,232,250 400,000 525,000 Distribution & Customer Service Costs 76,800 Insurance on Plant & Equipment Property Taxes 3 Administrative Wages & Salaries Advertising Expenses 585,000 90,000 1,076,000 57,700 Sales Commission 6% of Sales Revenue "Of the total depreciation, 80% relates to factory plant & equipment and 20% relates to general and administrative costs. 2 Of the total utilities, 75% relates to production and 25% relates to general and administrative costs. 3 The property taxes should be shared: 85% production & 15% general & administrative costs The following additional information is also available: Inventory Data: 1/1/2020 Purchases 31/12/2020 Raw Materials $750,000 $4,330,000 $807,000 Indirect Materials 55,000 320,000 71,500 Work in Progress Finished Goods n/a n/a 924,000 1,720,200 1,115,400 1,142,600

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter2: Building Blocks Of Managerial Accounting

Section: Chapter Questions

Problem 4EB: Roper Furniture manufactures office furniture and tracks cost data across their process. The...

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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)
Self-Construction Olson Machine Company manufactures small and large milling machines. Selling prices of these machines range from 35,000 to 200,000. During the 5-month period from August 1, 2019, through December 31, 2019, Olson manufactured a milling machine for its own use. This machine was built as part of the regular production activities. The project required a large amount of time front planning and supervisory personnel, as well as that of some of the companys officers, because it was a more sophisticated type of machine than the regular production models. Throughout the 5-month period, Olson charged all costs directly associated with the construction of the machine to a special account entitled Asset Construction Account. An analysis of the charges to this account as of December 31, 2019, follows: Olson allocates factory overhead to normal production as a percent of direct labor dollars as follows: Olson uses a flat rate of 40% of direct labor dollars to allocate general and administrative overhead. During the machine testing period, a cutter head malfunctioned and did extensive damage to the machine table and one cutter housing. This damage was not anticipated and was the result of an error in the assembly operation. Although no additional raw materials were needed to make the machine operational after the accident, the following labor for rework was required: Olson has included all these labor charges in the asset construction account. In addition, it included in the account the repairs and maintenance charges of 1,340 that it incurred as a result of the malfunction. Required: 1. Compute, consistent with GAAP and common practice, the amount that Olson should capitalize for the milling machine as of December 31, 2019, when it declares the machine operational. 2. Next Level Identify the costs you included in Requirement 1 for which there are acceptable alternative procedures. Describe the alternative procedure(s) in each case.
Hicks Products produces and sells patio furniture through a national dealership network. They purchase raw materials from a variety of suppliers and all manufacturing, and assembly work is performed at their plant outside of Cleveland, Ohio. They recorded these costs for the year ending December 31, 2017. Construct an income statement for Hicks Products, to reflect their net income for 2017.
Classifying costs as factory overhead Which of the following items are properly classified as part of factory overhead for Caterpillar? a. Amortization of patents on new assembly process b.Consultant fees for a study of production line employee productivity C. Depreciation on Peoria. Illinois, headquarters building d.Factory supplies used in the Morganton. North Carolina, engine parts plant e.Interest expense on debt f. Plant manager's salary at Aurora, Illinois, manufacturing plant g.Properly taxes on the Danville, Kentucky, tractor tread plant h.Sales incentive fees to dealers i. Steel plate j. Vice president of finance's salary
Pro-Leather Company is a manufacturer of leather cases for tablets. The following information pertainsto operations during the 2020 calendar year.Sales Revenue $14,275,000Direct Factory Labor 3,952,600Indirect Factory Labor 1,232,250Total Depreciation 1 400,000Total Utilities 2 525,000Distribution & Customer Service Costs 76,800Insurance on Plant & Equipment 585,000Property Taxes 3 90,000Administrative Wages & Salaries 1,076,000Advertising Expenses 57,700Sales Commission 6% of Sales Revenue1Of the total depreciation, 80% relates to factory plant & equipment and 20% relates to general andadministrative costs.2 Of the total utilities, 75% relates to production and 25% relates to general and administrativecosts.3 The property taxes should be shared: 85% production & 15% general & administrative costsThe following additional information is also available:Inventory Data: 1/1/2020 Purchases 31/12/2020Raw Materials $750,000 $4,330,000 $807,000Indirect Materials 55,000…
Pro-Leather Company is a manufacturer of leather cases for tablets. The following information pertains to operations during the 2020 calendar year.Sales Revenue $14,275,000Direct Factory Labor 3,952,600Indirect Factory Labor 1,232,250Total Depreciation 1 400,000Total Utilities 2 525,000Distribution & Customer Service Costs 76,800Insurance on Plant & Equipment 585,000Property Taxes 3 90,000Administrative Wages & Salaries 1,076,000Advertising Expenses 57,700Sales Commission 6% of Sales Revenue Of the total depreciation, 80% relates to factory plant & equipment and 20% relates to general and administrative costs.Of the total utilities, 75% relates to production and 25% relates to general and administrative costs.The property taxes should be shared: 85% production & 15% general & administrative costs. The following additional information is also available:Inventory Data: 1/1/2020 Purchases 31/12/2020Raw Materials…
Please Help Me ASAP For the year 2020, the following cost data pertain to the Leatherex Company's manufacturing activities: Costs of manufacturing overhead: Factory property taxes are $1,500. Factory 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 3,000 indirect materials 5,000 hours of indirect work Factory depreciation is 12,000 dollars. 3,000 in factory insurance $27,000 in total Other expenses incurred include: Direct material purchases totaled $16,000. $20,000 was spent on direct labour. Stockpiles: January 1st, direct materials $4,000 December 31st, direct materials $3,500.00 $3,000 for work in progress as of January 1st. December 31st, work in progress $3,750.00 January 1st, Finished Goods $3,850 December 31 Finished Goods $3,400 To apply manufacturing, the company uses a fixed overhead rate based on machine hour. Production costs include overhead. Last year, the cost was $5.00 per machine-hour. At the start of this, The production manager expected to…
Pro-Leather Company is a manufacturer of leather cases for tablets. The following information pertains to operations during the 2020 calendar year. Sales Revenue $14,275,000 Direct Factory Labor 3,952,600 Indirect Factory Labor 1,232,250 Total Depreciation 1 400,000 Total Utilities 2 525,000 Distribution & Customer Service Costs 76,800 Insurance on Plant & Equipment 585,000 Property Taxes 3 90,000 Administrative Wages & Salaries 1,076,000 Advertising Expenses 57,700 Sales Commission 6% of Sales Revenue Of the total depreciation, 80% relates to factory plant & equipment and 20% relates…
Pro-Leather Company is a manufacturer of leather cases for tablets. The following information pertains to operations during the 2020 calendar year. Sales Revenue $14,275,000 Direct Factory Labor 3,952,600 Indirect Factory Labor 1,232,250 Total Depreciation 1 400,000 Total Utilities 2 525,000 Distribution & Customer Service Costs 76,800 Insurance on Plant & Equipment 585,000 Property Taxes 3 90,000 Administrative Wages & Salaries 1,076,000 Advertising Expenses 57,700 Sales Commission 6% of Sales Revenue a) Of the total depreciation, 80% relates to factory plant & equipment and 20% relates to general and administrative costs. b) Of the total utilities, 75% relates to production and 25% relates to general and administrative costs. c) The property taxes should be shared: 85% production & 15% general & administrative costs. The following additional information is also available: Inventory Data:…
Pro-Leather Company is a manufacturer of leather cases for tablets. The following information pertains to operations during the 2020 calendar year. Sales Revenue $14,275,000 Direct Factory Labor 3,952,600 Indirect Factory Labor 1,232,250 Total Depreciation 1 400,000 Total Utilities 2 525,000 Distribution & Customer Service Costs 76,800 Insurance on Plant & Equipment 585,000 Property Taxes 3 90,000 Administrative Wages & Salaries 1,076,000 Advertising Expenses 57,700 Sales Commission 6% of Sales Revenue a) Of the total depreciation, 80% relates to factory plant & equipment and 20% relates to general and administrative costs. b) Of the total utilities, 75% relates to production and 25% relates to general and administrative costs. c) The property taxes should be shared: 85% production & 15% general & administrative costs. The following additional information is also available: Inventory…
Pro-Leather Company is a manufacturer of leather cases for tablets. The following information pertains to operations during the 2020 calendar year. Sales Revenue $14,275,000 Direct Factory Labor 3,952,600 Indirect Factory Labor 1,232,250 Total Depreciation 1 400,000 Total Utilities 2 525,000 Distribution & Customer Service Costs 76,800 Insurance on Plant & Equipment 585,000 Property Taxes 3 90,000 Administrative Wages & Salaries 1,076,000 Advertising Expenses 57,700 Sales Commission 6% of Sales Revenue Of the total depreciation, 80% relates to factory plant & equipment and 20% relates…
Pro-Leather Company is a manufacturer of leather cases for tablets. The following information pertains to operations during the 2020 calendar year. Sales Revenue $14,275,000 Direct Factory Labor 3,952,600 Indirect Factory Labor 1,232,250 Total Depreciation 1 400,000 Total Utilities 2 525,000 Distribution & Customer Service Costs 76,800 Insurance on Plant & Equipment 585,000 Property Taxes 3 90,000 Administrative Wages & Salaries 1,076,000 Advertising Expenses 57,700 Sales Commission 6% of Sales Revenue a) Of the total depreciation, 80% relates to factory plant & equipment and 20% relates to general and administrative costs. b) Of the total utilities, 75% relates to production and 25% relates to general and administrative costs. c) The property taxes should be shared: 85% production & 15% general & administrative costs. The following additional information is also available: Inventory Data:…