Bundle: Managerial Accounting, Loose-leaf Version, 14th - Book Only
14th Edition
ISBN: 9781337541398
Author: Carl Warren; James M. Reeve; Jonathan Duchac
Publisher: Cengage Learning
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Chapter 2, Problem 14E
(a)
To determine
Income statement:
The financial statement which reports revenues and expenses from business operations and the result of those operations as net income or net loss for a particular time period is referred to as income statement.
To prepare: the income statement for Company CL.
(b)
To determine
the inventory balance at the end of the first month of operations for company CL.
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Financial Statements of a Manufacturing Firm
The following events took place for Rushmore Biking Inc. during February, the first month of operations as a producer of road bikes:
•
Purchased $570,100 of materials.
•
Used $490,300 of direct materials in production.
•
Incurred $420,000 of direct labor wages.
•
Applied factory overhead at a rate of 80% of direct labor cost.
•
Transferred $1,196,400 of work in process to finished goods.
•
Sold goods with a cost of $1,128,800.
•
Revenues earned by selling bikes, $2,020,600.
•
Incurred $485,400 of selling expenses.
•
Incurred $180,600 of administrative expenses.
a. Prepare the income statement for Rushmore Biking Inc. for the month ending February 28. Assume that Rushmore Biking Inc. uses the perpetual inventory method.
Financial Statements of a Manufacturing Firm
The following events took place for Focault Inc. during July 20Y2, the first month of
operations as a producer of road bikes:
• Purchased $267,400 of materials
• Used $230,000 of direct materials in production
• Incurred $196,000 of direct labor wages
• Applied factory overhead at a rate of 75% of direct labor cost
• Transferred $550,100 of work in process to finished goods
• Sold goods with a cost of $532,100
• Sold goods for $952,500
• Incurred $228,800 of selling expenses
• Incurred $85,100 of administrative expenses
a. Prepare the July income statement for Focault. Assume that Focault uses the
perpetual inventory method.
Focault Inc.
Income Statement
For the Month Ended July 31, 20Y2
Selling and administrative expenses:
Total selling and administrative expenses
b. Determine the inventory balances at the end of the first month of operations.
Materials inventory, July 31
Work in process inventory, July 31
Finished goods inventory, July 31
Financial Statements of a Manufacturing Firm
The following events took place for Rushmore Biking Inc. during February, the first month of operations as a producer of road bikes:
•
Purchased $385,900 of materials.
•
Used $331,900 of direct materials in production.
•
Incurred $284,000 of direct labor wages.
•
Applied factory overhead at a rate of 80% of direct labor cost.
•
Transferred $809,400 of work in process to finished goods.
•
Sold goods with a cost of $771,800.
•
Revenues earned by selling bikes, $1,381,500.
•
Incurred $331,900 of selling expenses.
•
Incurred $123,500 of administrative expenses.
a. Prepare the income statement for Rushmore Biking Inc. for the month ending February 28. Assume that Rushmore Biking Inc. uses the perpetual inventory method.
Rushmore Biking Inc.
Income Statement
For the Month Ended February 28
$
$
Selling and administrative expenses:
$
Total selling and administrative…
Chapter 2 Solutions
Bundle: Managerial Accounting, Loose-leaf Version, 14th - Book Only
Ch. 2 - A. Name two principal types of cost accounting...Ch. 2 - What kind of firm would use a job order cost...Ch. 2 - Which account is used in the job order cost system...Ch. 2 - What document is the source for (A) debiting the...Ch. 2 - What is a job cost sheet?Ch. 2 - Prob. 6DQCh. 2 - Discuss how the predetermined factory overhead...Ch. 2 - A. How is a predetermined factory overhead rate...Ch. 2 - Prob. 9DQCh. 2 - Describe how a job order cost system can be used...
Ch. 2 - Issuance of materials On May 7, Bergan Company...Ch. 2 - Direct labor costs During May, Bergan Company...Ch. 2 - Factory overhead costs During May, Bergan Company...Ch. 2 - Prob. 4BECh. 2 - Prob. 5BECh. 2 - Cost of goods sold Pine Creek Company completed...Ch. 2 - Transactions in a job order cost system Five...Ch. 2 - Prob. 2ECh. 2 - Cost of materials issuances under the FIFO method...Ch. 2 - Prob. 4ECh. 2 - Entries for materials GenX Furnishings Company...Ch. 2 - Prob. 6ECh. 2 - Entry for factory labor costs The weekly time...Ch. 2 - Prob. 8ECh. 2 - Prob. 9ECh. 2 - Prob. 10ECh. 2 - Predetermined factory overhead rate Poehling...Ch. 2 - Prob. 12ECh. 2 - Entries for factory costs and jobs completed Old...Ch. 2 - Prob. 14ECh. 2 - Prob. 15ECh. 2 - Job order cost accounting for a service company...Ch. 2 - Prob. 1PACh. 2 - Entries and schedules for unfinished jobs and...Ch. 2 - Job cost sheet Remnant Carpet Company sells and...Ch. 2 - Analyzing manufacturing cost accounts Fire Rock...Ch. 2 - Prob. 5PACh. 2 - Entries for costs in a job order cost system Royal...Ch. 2 - Entries and schedules for unfinished jobs and...Ch. 2 - Job cost sheet Stretch and Trim Carpet Company...Ch. 2 - Analyzing manufacturing cost accounts Clapton...Ch. 2 - Flow of costs and income statement Technology...Ch. 2 - Alvarez Manufacturing Inc. is a job shop. The...Ch. 2 - Prob. 2ADMCh. 2 - Prob. 3ADMCh. 2 - Ethics in Action TAC Industries Inc. sells heavy...Ch. 2 - Prob. 2TIFCh. 2 - Communication Carol Creedence, the plant manager...
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