SURVEY OF ACCOUNTING 360DAY CONNECT CAR
5th Edition
ISBN: 9781260591811
Author: Edmonds
Publisher: MCG
expand_more
expand_more
format_list_bulleted
Question
Chapter 10, Problem 3ATC
a.
To determine
Explain whether the cost incurred for manufacturing the products of Company S is primarily designed to meet the needs of internal or external needs.
b.
To determine
Whether Company S treats handling cost and shipping cost as non-product or product costs.
c
To determine
Whether Company S treats promotion and advertising costs as non-product or product costs.
d.
To determine
Identify the categories of inventory reported by Company S in its annual report.
e.
To determine
The cost of land owned by Company S, and the cost of machinery and equipment.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
Question 1.
Case 2. Book problem. Incomplete manufacturing costs, expenses and selling data for two different cases are shown below:
Required:
1. Indicate the missing amount for each letter
2. Prepare a schedule of cost of goods manufactured
3. Prepare a schedule of cost of goods sold
4. Prepare an income statement (Optional)
Case 1
Case 2
Raw materials used
9,600
g)
Direct labor cost
5,000
8,000
Total Factory overhead
8,000
4,000
Total Manufacturing costs
a)
16,000
Beginning work in process inventory
1,000
h)
Ending work in process inventory
b)
3,000
Sales revenue
24,500
i)…
Exercise 2-27 Statement of comprehensive Income and schedule of cost of goods manufactured.
The Howell Corporation has the following account balances (all in millions):
For Specific Date
Direct Materials, January 01, 2019 $18
Work in process, January 01, 2019 12
Finished Goods, January 01, 2019 84
Direct Materials, December 31, 2019 24
Work in Process, December 31, 2019 6
Finished Goods, December 31, 2019 66
For the Year 2019
Purchased of Direct Materials $390
Direct Manufacturing Labour 120
Depreciation, - Plant, Building, and Equipment 96
Plant Supervisory Salaries 6
Miscellaneous Plant Overhead 42
Revenues 1140
Marketing, Distribution and Customer Service Cost 288
Plant Supplies Used 12
Plant Utilities 36
Indirect Manufacturing Labour 72
Required:
Prepare a statement of Comprehensive Income and a supporting schedule of goods manufactured for…
Problem 1-27A Importance of cost classification
Campbell Manufacturing Company (CMC) was started when it acquired $80,000 by issuing common stock. During the first year of operations, the company incurred specifically identifiable product costs (materials, labor, and overhead) amounting to $75,000. CMC also incurred $60,000 of engineering design and planning costs. There was a debate regarding how the design and planning costs should be classified. Advocates of Option 1 believe that the costs should be classified as general, selling, and administrative costs. Advocates of Option 2 believe it is more appropriate to classify the design and planning costs as product costs. During the year, CMC made 5,000 units of product and sold 4,000 units at a price of $35 each. All transactions were cash transactions.
Required
4. Assume a 30 percent income tax rate. Determine the amount of income tax expense under each of the two options. Identify the option that minimizes the amount of the company’s…
Chapter 10 Solutions
SURVEY OF ACCOUNTING 360DAY CONNECT CAR
Ch. 10 - 1. What are some differences between financial and...Ch. 10 - 2. What does the value-added principle mean as it...Ch. 10 - 4. How does product costing used in financial...Ch. 10 - 5. What does the statement costs can be assets or...Ch. 10 - 6. Why are the salaries of production workers...Ch. 10 - 7. How do product costs affect the financial...Ch. 10 - 8. What is an indirect cost? Provide examples of...Ch. 10 - 9. How does a product cost differ from a selling,...Ch. 10 - 10. Why is cost classification important to...Ch. 10 - 11. What is cost allocation? Give an example of a...
Ch. 10 - 13. What are some of the common ethical conflicts...Ch. 10 - 14. What costs should be considered in determining...Ch. 10 - 15. What is a just-in-time (JIT) inventory system?...Ch. 10 - Prob. 14QCh. 10 - Prob. 15QCh. 10 - Prob. 16QCh. 10 - Prob. 17QCh. 10 - Prob. 18QCh. 10 - Prob. 19QCh. 10 - Prob. 1ECh. 10 - Exercise 1-2A Identifying product versus selling,...Ch. 10 - Prob. 3ECh. 10 - Prob. 4ECh. 10 - Prob. 5ECh. 10 - Exercise 1-6A Identifying product versus SGA costs...Ch. 10 - LO 1-3 Exercise 1-7A Recording product versus SGA...Ch. 10 - Prob. 8ECh. 10 - LO 1-4 Exercise 1-9A Upstream, midstream, and...Ch. 10 - Prob. 10ECh. 10 - Prob. 11ECh. 10 - Prob. 12ECh. 10 - Prob. 13ECh. 10 - Cost of goods manufactured and sold The following...Ch. 10 - Prob. 15ECh. 10 - Exercise 1-14A Using JIT to minimize waste and...Ch. 10 - Prob. 17ECh. 10 - Prob. 18ECh. 10 - Prob. 19ECh. 10 - Prob. 20ECh. 10 - Problem 1-19A Characteristics of financial versus...Ch. 10 - Prob. 22PCh. 10 - Problem 1-21A Effect of product versus period...Ch. 10 - Problem 1-22A Product versus SGA costs The...Ch. 10 - Prob. 25PCh. 10 - Prob. 26PCh. 10 - Prob. 27PCh. 10 - Prob. 28PCh. 10 - Prob. 29PCh. 10 - Prob. 30PCh. 10 - Prob. 31PCh. 10 - Prob. 32PCh. 10 - Prob. 1ATCCh. 10 - Prob. 2ATCCh. 10 - Prob. 3ATCCh. 10 - Prob. 4ATCCh. 10 - Ethical Dilemma Product cost versus selling and...
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- Problem 1-27A Importance of cost classification Campbell Manufacturing Company (CMC) was started when it acquired $80,000 by issuing common stock. During the first year of operations, the company incurred specifically identifiable product costs (materials, labor, and overhead) amounting to $75,000. CMC also incurred $60,000 of engineering design and planning costs. There was a debate regarding how the design and planning costs should be classified. Advocates of Option 1 believe that the costs should be classified as general, selling, and administrative costs. Advocates of Option 2 believe it is more appropriate to classify the design and planning costs as product costs. During the year, CMC made 5,000 units of product and sold 4,000 units at a price of $35 each. All transactions were cash transactions. Required Prepare a GAAP-based income statement and balance sheet under each of the two options. Identify the option that results in financial statements that are more likely to leave…arrow_forwardProblem 2-62 (Static) Prepare Statements for a Manufacturing Company (LO 2-2, 4) Mesa Designs produces a variety of hardware products, primarily for the do-it-yourself (DIY) market. As part of your job interview as a summer intern at Mesa, the cost accountant provides you with the following (fictitious) data for the year (in $000). Inventory information: 1/1/00 12/31/00 Direct materials $96 $110 Work-in-process 152 136 Finished goods 1,974 2,026 Other information: For the year ’00 Administrative costs $4,200 Depreciation (Factory) 5,560 Depreciation (Machines) 9,240 Direct labor 13,000 Direct materials purchased 10,300 Indirect labor (Factory) 3,340 Indirect materials (Factory) 960 Property taxes (Factory) 370 Selling costs 2,140 Sales revenue 60,220 Utilities (Factory) 1,060 Required: 1. Prepare a cost of goods sold statement. 2. Prepare an income statement.arrow_forwardCS_3_QA3_LA: Req 3A: Compute the unit product cost for Year 1, Year 2, and Year 3. (Round your intermediate calculations and final answers to 2 decimal places.) Unit Product Cost Year 1 Year 2 Year 3 Req 3B: Prepare an income statement for Year 1, Year 2, and Year 3. (Round your intermediate calculations to 2 decimal places.) O’Brien Company Absorption Costing Income Statement Year 1 Year 2 Year 3 Sales Cost of goods sold Gross margin 0 0 0 Selling and administrative expenses Net operating income $0 $0 $0arrow_forward
- PROBLEM 2-27 Schedule of Cost of Goods Manufactured; Income Statement; Cost Behavior[LO1, LO2, LO3, LO4, LO5]The following selected account balances for the year ended December 31 are provided for ValenkoCompany Advertising expense . . . . . . . . . . . . . . . . . . $215,000Insurance, factory equipment. . . . . . . . . . . . $8,000Depreciation, sales equipment. . . . . . . . . . . $40,000Rent, factory building . . . . . . . . . . . . . . . . . . $90,000Utilities, factory. . . . . . . . . . . . . . . . . . . . . . . $52,000Sales commissions . . . . . . . . . . . . . . . . . . . $35,000Cleaning supplies, factory . . . . . . . . . . . . . . $6,000Depreciation, factory equipment . . . . . . . . . $110,000Selling and administrative salaries. . . . . . . . $85,000Maintenance, factory . . . . . . . . . . . . . . . . . . $74,000Direct labor. . . . . . . . . . . . . . . . . . . . . . . . . . ?Purchases of raw materials . . . . . . . . . . . . . $260,000 Inventory balances at the beginning and…arrow_forwardquestion 4 CTSha Sdn. Bhd., a local business involved in the manufacturing of plastic, metal and other moulds for a wide variety of industrial customers, had the following balances extracted from its books on 31 December 2020. Name of Account RM WIP - Raw materials, 1 January 2020 14,630 WIP - Factory wages, 1 January 2020 18,330 WIP - Factory overhead, 1 January 2020 21,660 Raw materials, 1 January 2020 36,700 Raw materials purchases 251,340 Transportation of raw materials 8,340 Custom duties on raw materials 9,600 Insurance on raw materials 3,500 Factory wages 285,430 Group accident insurance on factory workers 12,340 Depreciation of plant and factory machinery 48,000 Oils and lubricants 5,700 Factory supervisor's wages 30,400 Factory cleaner’s wages 12,300 Factory security's staff salaries 18,600 Factory repairs and maintenance 9,560 Factory insurance…arrow_forwardCS_3_QA3_LA_2ND_CH Req 3A: Compute the unit product cost for Year 1, Year 2, and Year 3. (Round your intermediate calculations and final answers to 2 decimal places.) Unit Product Cost Year 1 Year 2 Year 3 Req 3B: Prepare an income statement for Year 1, Year 2, and Year 3. (Round your intermediate calculations to 2 decimal places.) O’Brien Company Absorption Costing Income Statement Year 1 Year 2 Year 3 Salesselected answer correct Cost of goods soldselected answer correct Gross marginselected answer correct Selling and administrative expensesselected answer correct Net operating incomeselected answer correctarrow_forward
- Q#2 The ASF Corporation manufactures one product and accounts for costs by a job orders cost system You have obtained the following information for the year ended December 31 2010 from the Corporations books and records Total manufacturing cost added during 2010 was 1,000,000 Cost of goods manufactured was 970,000 Factory overhead was applied to work in process inventory at 80% of direct labor (applied factory overhead for the year 27% of the total manufacturing cost) Beginning work in process inventory January 1 was 80% of ending work-in – process inventory December 31 Required 1. Prepare a formal statement of cost good manufacturedarrow_forwardQuestion 6- Previously answered incorrectly (attached) The following selected account balances are provided for Delray Mfg. Sales $ 1,250,000 Raw materials inventory, Dec. 31, 2016 37,000 Work in process inventory, Dec. 31, 2016 53,900 Finished goods inventory, Dec. 31, 2016 62,750 Raw materials purchases 175,600 Direct labor 225,000 Factory computer supplies used 17,840 Indirect labor 47,000 Repairs—Factory equipment 5,250 Rent cost of factory building 57,000 Advertising expense 94,000 General and administrative expenses 129,300 Raw materials inventory, Dec. 31, 2017 42,700 Work in process inventory, Dec. 31, 2017 41,500 Finished goods inventory, Dec. 31, 2017 67,300arrow_forwardQ # 2 XYZ Incorporation provides the following financial data for the month of July 2020: Beginning Inventories 'Rs.' Direct Material 12,000 WIP - Finished Goods - 1. Purchased material on accounts for Rs. 200,000 2. Defective material returned to supplier worth Rs. 5,000 3. Material and labor issued to job during the month Direct material Direct Labor Job # 101 40,000 65,000 Job # 102 50,000 80,000 Job # 103 30,000 50,000 Job # 104 25,000 40,000 Indirect 5,000 15,000 4. FOH rate is 120% of direct labor cost 5. Actual FOH cost incurred on account Rs. 250,000 Required a) Prepare journal entries to…arrow_forward
- Problem 2. Statement of Costs of Goods Manufactured and Income statement. The following information are gathered from the accounting records of Genet Inc. for the current month: Inventory information Beginning balance $ Ending balance $ Raw materials inventory $46,800 $43,600 Work-in-Process inventory $33,400 $35,700 Finished goods inventory $42,500 $31,800 Other information $ Revenue $800,000 Purchase of raw materials $72,100 Indirect materials costs $5,600 Indirect labor costs $20,000 Office staff salaries $28,000 Office equipment depreciation $2,000 Factory machinery maintenance costs $5,000 Environmental compliance costs - factory $1,200 Direct labor - Wages of production line workers $32,000 Sales staff salaries $12,000 Advertising costs $8,000 Miscellaneous manufacturing overhead costs $11,000 Required: a.…arrow_forwardProblem 3-13 (Algo) Schedules of Cost of Goods Manufactured and Cost of Goods Sold; Income Statement [LO3-3] Superior Company provided the following data for the year ended December 31 (all raw materials are used in production as direct materials): Selling expenses $ 214,000 Purchases of raw materials $ 268,000 Direct labor ? Administrative expenses $ 159,000 Manufacturing overhead applied to work in process $ 373,000 Actual manufacturing overhead cost $ 355,000 Inventory balances at the beginning and end of the year were as follows: Beginning Ending Raw materials $ 54,000 $ 40,000 Work in process ? $ 24,000 Finished goods $ 39,000 ? The total manufacturing costs added to production for the year were $670,000; the cost of goods available for sale totaled $730,000; the unadjusted cost of goods sold totaled $669,000; and the net operating income was $33,000. The company’s underapplied or overapplied overhead is closed to Cost of Goods Sold.…arrow_forwardCosting inventory Golden Eagle Company begun operations in 2016 by selling a single product. Data on purchases and sales for the year were as follows: Sales: April 16,000 units May 16,000 June 20,000 July 24,000 August 28,000 September 28.000 October 18,000 November 10,000 December 8,000 Total units 168,000 Total sales 10,000,000 On January 4, 2017, the president of the company, Connie Kilmer, asked for your advice on costing the 32,000-unit physical inventory that was taken on December 51, 2016. Moreover, since the firm plans to expand its product line, she asked for your advice on the use of a perpetual inventory system in the future. 1. Determine the cost of the December 31. 2016, inventory under the periodic system, using the (a) first-m, first-out method, (b) last-in, first-out method, and (c) weighted average cost method. 2. Determine the gross profit for the year under each of the three methods in (1). 3. a. Explain varying viewpoints why each of the three inventory costing methods may best reflect the results of operations for 2016. b. Which of the three inventory costing methods may best reflect the replacement cost of the inventory on the balance sheet as of December 31, 2016:' c. Which inventory costing method would you choose to use for income tax purposes? Why? d. Discuss the advantages and disadvantages of using a perpetual inventory system. From the data presented in this case, is there any indication of the adequacy of inventory' levels during the year?arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Financial & Managerial AccountingAccountingISBN:9781285866307Author:Carl Warren, James M. Reeve, Jonathan DuchacPublisher:Cengage LearningAccounting (Text Only)AccountingISBN:9781285743615Author:Carl Warren, James M. Reeve, Jonathan DuchacPublisher:Cengage LearningCornerstones of Financial AccountingAccountingISBN:9781337690881Author:Jay Rich, Jeff JonesPublisher:Cengage Learning
- Corporate Financial AccountingAccountingISBN:9781337398169Author:Carl Warren, Jeff JonesPublisher:Cengage LearningCorporate Financial AccountingAccountingISBN:9781305653535Author:Carl Warren, James M. Reeve, Jonathan DuchacPublisher:Cengage Learning
Financial & Managerial Accounting
Accounting
ISBN:9781285866307
Author:Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:Cengage Learning
Accounting (Text Only)
Accounting
ISBN:9781285743615
Author:Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:Cengage Learning
Cornerstones of Financial Accounting
Accounting
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Cengage Learning
Corporate Financial Accounting
Accounting
ISBN:9781337398169
Author:Carl Warren, Jeff Jones
Publisher:Cengage Learning
Corporate Financial Accounting
Accounting
ISBN:9781305653535
Author:Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:Cengage Learning
Topic 6 - Financial statement analysis; Author: drdavebond;https://www.youtube.com/watch?v=uUnP5qkbQ20;License: Standard Youtube License