Managerial Accounting
15th Edition
ISBN: 9781337912020
Author: Carl Warren, Ph.d. Cma William B. Tayler
Publisher: South-Western College Pub
expand_more
expand_more
format_list_bulleted
Concept explainers
Videos
Textbook Question
Chapter 2, Problem 4PA
Analyzing
Fire Rock Company manufactures designer paddle boards in a wide variety of sizes and styles. The following incomplete ledger accounts refer to transactions that are summarized for June:
In addition, the following information is available:
- A. Materials and direct labor were applied to six jobs in June:
- B. Factory
overhead is applied to each job at a rate of 140% of direct labor cost. - C. The June 1 Work in Process balance consisted of two jobs, as follows:
- D. Customer jobs completed and units sold in June were as follows:
Instructions
- 1. Determine the missing amounts associated with each letter. Provide supporting computations by completing a table with the following headings:
- 2. Determine the June 30 balances for each of the inventory accounts and factory overhead.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
What's the difference between calculating EPS for a simple capital structure versus a complex capital structure?
In the first two years of operations, a company reports taxable income of $115,000 and $165,000, respectively. In the first two years, the tax rates were 38% and 32% respectively. It is now the end of the third year, and the company has a loss of $160,000 for tax purposes. The company carries losses to the earliest year possible. The tax rate is currently 25%.
Required
How much tax was paid in year 1 and year 2?
Compute the amount of income tax payable or receivable in the current (third) year.
Question 22 (18 points)
Problem 2 – Accounting Changes (18 marks)
During the audit of Hoppy Ending Brewery for the fiscal year ended June 30, 2027, the auditors identified the following issues:
a. The company sells beer for $1 each plus $0.10 deposit on each bottle. The deposit collected is payable to the provincial recycling agency. During 2026, the company had recorded $12,000 of deposits as revenue. The auditors believe this amount should have been recorded as a liability.
b. The company had been using the first-in, first-out cost flow assumption for its inventories. In fiscal 2027, management decided to switch to the weighted-average method. This change reduced inventory by $25,000 at June 30, 2026, and $40,000 at June 30, 2027.
c. The company has equipment costing $6,000,000 that it has been depreciating over 10 years on a straight-line basis. The depreciation for fiscal 2026 was $600,000 and accumulated depreciation on June 30,…
Chapter 2 Solutions
Managerial Accounting
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 - Applying factory overhead Bergan Company estimates...Ch. 2 - Job costs At the end of May, Bergan Company had...Ch. 2 - Cost of goods sold Pine Creek Company completed...Ch. 2 - Transactions in a job order cost system Five...Ch. 2 - The following information is available for the...Ch. 2 - Cost of materials issuances under the FIFO method...Ch. 2 - Materials issued are as follows: Journalize the...Ch. 2 - Kingsford Furnishings Company manufactures...Ch. 2 - A summary of the time tickets is as follows:...Ch. 2 - Entry for factory labor costs The weekly time...Ch. 2 - Schumacher Industries Inc. manufactures...Ch. 2 - Eclipse Solar Company operates two factories. The...Ch. 2 - Exotic Engine Shop uses a job order cost system to...Ch. 2 - Predetermined factory overhead rate Poehling...Ch. 2 - The following account appears in the ledger prior...Ch. 2 - Collegiate Publishing Inc. began printing...Ch. 2 - The following events took place for Rushmore...Ch. 2 - Job order cost accounting for a service company...Ch. 2 - Job order cost accounting for a service company...Ch. 2 - Barnes Company uses a job order cost system. The...Ch. 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 - Antolini Enterprises produces mens sports coats...Ch. 2 - Alvarez Manufacturing Inc. is a job shop. The...Ch. 2 - Prob. 3MADCh. 2 - Prob. 4MADCh. 2 - Ethics in Action TAC Industries Inc. sells heavy...Ch. 2 - Prob. 2TIFCh. 2 - Communication Carol Creedence, the plant manager...Ch. 2 - RIRA Company makes attachments such as backhoes...Ch. 2 - Todd Lay just began working as a cost accountant...Ch. 2 - Baldwin Printing Company uses a job order cost...Ch. 2 - John Sheng, a cost accountant at Starlet Company,...Ch. 2 - Lucy Sportswear manufactures a specialty line of...Ch. 2 - Patterson Corporation expects to incur 70,000 of...
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
- Les Mills Ltd.'s policy is to report all cash flows arising from interest and dividends in the operating section. Les Mills activities for the year ended December 31, 2026, included the following: • Income tax expense for the year was $30,000. • Sold an investment at FVOCI for $45,000. The original cost of the investment was $52,000. • Depreciation expense for the year was $19,000. • Sales for the year were $1,030,000. • Selling and administration expenses for the year totaled $240,000. • Les Mills cost of goods sold in 2026 was $315,000. • Interest expense for the period was $12,000. The interest payable account increased $5,000. • Accounts payable increased $20,000 in 2026. • Accounts receivable decreased $36,000 in 2026. • Les Mills inventory increased $13,000 during the year. • Dividends were not declared during the year; however, the dividends payable account decreased $5,000. Required Prepare the cash flows from operating activities…arrow_forwardThe following is an excerpt from a company's financial records at year-end. Balance in CAD US dollars chequing account. $10,000 Cash in sinking fund account for a future repurchase of common shares. 50,000 Term deposit maturing 100 days after the year-end. 78,000 Bank loan (60,000) Cash restricted for plant expansion. 45,000 Cash on hand. 7,800 Bank overdraft - part of cash management system (9,000) The "cash and cash equivalents" in the cash flow statement will be: Question 20 options: ($51,200) $8,800 ($1,200) $17,800arrow_forwardWhat are investing activities? Question 19 options: Activities involving the acquisition and disposal of long-term assets and other investments. Activities involving the principal revenue-producing activities of the entity. Activities involving changes in the size and composition of the equity's borrowings. Activities that do not involve cash.arrow_forward
- What are financing activities? Question 18 options: Activities that result in changes in the size and composition of the contributed equity and borrowings of the entity. Activities involving the principal revenue-producing activities of the entity. Activities involving the acquisition and disposal of long-term assets.arrow_forwardIf a company has gaps between the change in cash and the net income for the year: Question 17 options: the financial statement notes provide explanation for the sources of these changes. the statement of cash flow and balance sheet provide explanation for these changes. the statement of cash flow provides explanation of the sources of these changes. the income statement provides sufficient explanation for the sources of these changes.arrow_forwardIf a company has gaps between the change in cash and the net income for the year: Question 17 options: the financial statement notes provide explanation for the sources of these changes. the statement of cash flow and balance sheet provide explanation for these changes. the statement of cash flow provides explanation of the sources of these changes. the income statement provides sufficient explanation for the sources of these changes.arrow_forward
- A company had taxable income of $2 million in fiscal 2026 and paid taxes of 0.7 million; the company incurred a loss of $8 million in fiscal 2027 when the tax rate is 50%. How much refund is the company entitled to? Question 16 options: $3.85 million $4 million Nil $0.7 millionarrow_forwardWhen will there be recapture and a capital gain? Question 15 options: When proceeds of disposal are between undepreciated capital cost and original cost. When proceeds of disposal are less than undepreciated capital cost. When proceeds of disposal are more than original cost. When proceeds of disposal are more than undepreciated capital cost.arrow_forwardA company has income before tax of $350,000, which includes a permanent difference of $65,000 relating to non-taxable dividend income. There are no other permanent or temporary differences. The income tax rate is 45%. The taxes payable are: Question 14 options: $128,250 $157,500 $186,750 $285,000arrow_forward
- Which accurately describes the purpose of the taxes payable method? Question 13 options: It represents the amount of income recognized for accounting purposes. It calculates tax expense based on the accounting income before tax. It calculates tax expense based on the amount payable to tax authorities. It represents the amount of income recognized for tax purposes.arrow_forwardWhich of the following statements is true? Question 12 options: A change in accounting policy is an accounting change made at the discretion of management. Over time, the number of areas where management has a free choice over accounting policies has increased. The last-in, first-out (LIFO) cost flow assumption is an acceptable method for costing inventories in Canada. Changes in accounting policy occur more frequently than changes in estimates.arrow_forwardFor a company using the straight-line method of depreciation that changes the estimated useful life from 20 years to 15 years remaining as at the beginning of the year, the accountant should do the following: Question 11 options: Adjust the amount of accumulated depreciation as at the beginning of the year. Adjust prior year's depreciation. Compute current year depreciation as (carrying amount) x 15/20. Compute current year depreciation as (carrying amount - residual value) divided by 15 years.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Managerial AccountingAccountingISBN:9781337912020Author:Carl Warren, Ph.d. Cma William B. TaylerPublisher:South-Western College Pub
Financial And Managerial AccountingAccountingISBN:9781337902663Author:WARREN, Carl S.Publisher:Cengage Learning,
Cornerstones of Cost Management (Cornerstones Ser...AccountingISBN:9781305970663Author:Don R. Hansen, Maryanne M. MowenPublisher:Cengage Learning
Managerial Accounting: The Cornerstone of Busines...AccountingISBN:9781337115773Author:Maryanne M. Mowen, Don R. Hansen, Dan L. HeitgerPublisher:Cengage Learning
Principles of Cost AccountingAccountingISBN:9781305087408Author:Edward J. Vanderbeck, Maria R. MitchellPublisher:Cengage Learning
College Accounting, Chapters 1-27AccountingISBN:9781337794756Author:HEINTZ, James A.Publisher:Cengage Learning,
Managerial Accounting
Accounting
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:South-Western College Pub
Financial And Managerial Accounting
Accounting
ISBN:9781337902663
Author:WARREN, Carl S.
Publisher:Cengage Learning,
Cornerstones of Cost Management (Cornerstones Ser...
Accounting
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Cengage Learning
Managerial Accounting: The Cornerstone of Busines...
Accounting
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Cengage Learning
Principles of Cost Accounting
Accounting
ISBN:9781305087408
Author:Edward J. Vanderbeck, Maria R. Mitchell
Publisher:Cengage Learning
College Accounting, Chapters 1-27
Accounting
ISBN:9781337794756
Author:HEINTZ, James A.
Publisher:Cengage Learning,
Cost Accounting - Definition, Purpose, Types, How it Works?; Author: WallStreetMojo;https://www.youtube.com/watch?v=AwrwUf8vYEY;License: Standard YouTube License, CC-BY