just a quick study guide for final exam
How do you alculate break-even point from dollars?
How do you calculate operation Leverage?
If given Fixed and variable overheads determine what amount wouldbe escorted on the variable cost sheet?
How do they relate: net present value and present value future cashflows?
How do you determine the equivalent units of production
How do you determine the rate of return on investment
How do you determine the budget cost of goods manufacturered
What's a budget? What's it's purpose?
If given the numbers for production beg inventory desired inventoryand sales volume determine how many you need to manufacture forthat month to meet the desired inventory?
High low method example:
Budgeted sale and conversion cost rate: what's included inthem?
Break even sales example with variable cost decreased by...
what kind of principal is inventory reduction?
Figure out overhead cost per unit when given labor hours machinehours and number of units with the cost of everything
Single plant wide multiple department and activity based costingpurpose?
Absorption cost balances sheet (has fixed amounts)
How do you determine activity rate for 6 differentdepartments
What's in conversion cost
just a quick study guide for final exam
How do you alculate break-even point from dollars?
How do you calculate operation Leverage?
If given Fixed and variable overheads determine what amount wouldbe escorted on the variable cost sheet?
How do they relate: net present value and present value future cashflows?
How do you determine the equivalent units of production
How do you determine the rate of return on investment
How do you determine the budget cost of goods manufacturered
What's a budget? What's it's purpose?
If given the numbers for production beg inventory desired inventoryand sales volume determine how many you need to manufacture forthat month to meet the desired inventory?
High low method example:
Budgeted sale and conversion cost rate: what's included inthem?
Break even sales example with variable cost decreased by...
what kind of principal is inventory reduction?
Figure out overhead cost per unit when given labor hours machinehours and number of units with the cost of everything
Single plant wide multiple department and activity based costingpurpose?
Absorption cost balances sheet (has fixed amounts)
How do you determine activity rate for 6 differentdepartments
What's in conversion cost
Related questions
i only need help with questions : 12, 14, 16,17c, 17d
1. (5 points) Make a list of materials needed tomanufacture one finished good. Include the following criteria:material (including block size), color, number required, cost perblock, and total cost per type of block. Determine the totalmaterial cost to manufacture one finished good. Include packagingfor the finished product.
2. (4 points) Determine how many direct labor employeesare necessary to meet demand. You do not intend to pay overtime.Laborers work eight hours a day Monday through Friday, which doesnot include time for lunch since it is not paid. They receive twoweeks of paid vacation, but six paid holidays. If your calculationresults in a partial person, remember that you will have to roundup to a whole number. You do not intend to hire any part-timelabor.
3. (3 points) Determine the annual cost fordirect labor (including benefits). Do notround.
4. (2 points) What is the direct labor costper finished product? Do not round.
5. Cost identification.
The following accounts are to be used in 5a-5e:
Account Name | Annual Amount |
Office Supplies | $500 |
Factory Utilities | $2400 |
Sales Commissions | $40000 |
Factory Equipment Depreciation | $500 |
Factory Rent | $5000 |
Advertising | $12000 |
Factory Managerâs Salary | $35000* |
Indirect Labor | $35000 |
Office Utilities | $600 |
Factory Insurance | $3600 |
Office Maintenance (Annual Contract) | $200 |
Sales Salaries | $60000* |
Office Equipment Depreciation | $1200 |
Indirect Materials | $5000 |
Freight-Out | $200000 |
Factory Equipment Repairs (based on expected quarterlyservice calls) | $800 |
*Includes medical benefits.
- (4 points) From the above list, select four variablemanufacturing overhead accounts.
- (4 points) From the above list, select four variableselling expense or administrative expense accounts.
- (4 points) From the above list, select four fixed sellingexpense or administrative expense accounts.
- (4 points) From the above list, select four fixedmanufacturing overhead accounts.
- (4 points) Fill out the attached spreadsheet with theinformation given in 5a-5d. That means you will have to keepreading these discussion areas.
Make sure your answers for the following questions reflectall of the costs on the 5e spreadsheet.
6. (3 points) What is the total manufacturingoverhead?
7. (5 points) Create a Cost of Goods ManufacturedSchedule. Do not round.
8. (4 points) What is the predetermined overhead ratebased on direct labor cost? Round to two decimal places and makesure your answer is in the correct format.
9. (4 points) What is the total manufacturing cost perunit? Do not round.
10. (5 points) Calculate the projected net income/(loss)for the first year. This should be in the form of an simple incomestatement including captions for revenue, cost of goods sold (donot round.), gross profit, operating expenses, and netincome/(loss). All operating expenses must be listed individually.Do not round.
11. Cost Identification
a. (2 points) What is the total variable cost?
b. (1 point) What is the total fixed cost?
- (5 points) How many finished units will you have to sellannually to break even? Do not round variable costs or contributionmargin. You will have to round the number of units to break even,since you cannot sell a partial unit. Remember to always round upfor break even, no matter what the decimal.
- ( 7 points) Using the break even or contribution marginequations, compute how many units need to be sold to earn a netincome of $60000. Create a C-V-P income statement to prove yourcalculations. Show all of your work to get the C-V-P incomestatement. Do not round variable costs or contribution margin. Youwill have to round the number of units to break even, since youcannot sell a partial unit. Remember to always round up for breakeven, no matter what the decimal.
- (4 points) Create a flexible manufacturing overheadbudget at a level of 110,000 finished units.
- (5 points) Prepare a flexible budget report given thatactual production was 110,000 finished units.
Actual overhead for the year included:
Factory Repairs $950
Factory Utilities $2430
Indirect Labor $36750
Indirect Materials $5700
Freight-Out $215000
Office Supplies $510
Commissions $43000
Office Utilities $750
Advertising $12000
Office Maintenance $300
Sales Salaries $60000
Office Depreciation $1200
Factory Depreciation $500
Factory Rent $5100
Manager's Salary $ 35000
Factory Insurance $3800
- (3 points) Sales per quarter are expected to be 10,000units, 30,000 units, 40,000 units, and 20,000 units, respectively.Prepare a correctly formatted sales budget.
- There is a shortage of large rectangular blocks! (None atall.)
a. (3 points) What is the new total product cost per unitif two small rectangular blocks are substituted for every largerectangular block? Do not round.
b. (5 points) Prepare an income statement to show the newnet income/(loss) with sales totaling 100,000 units. Use the newtotal product cost in Q17a. Do not round.
c. (5 points) How many finished units need to be soldannually to break even? Do not round variable costs or contributionmargin. You will have to round the number of units to break even,since you cannot sell a partial unit. Remember to always round upfor break even, no matter what the decimal. Use the new totalproduct cost in Q17a.
d. (5 points) Create a C-V-P income statement to proveyour break-even. Do not round variable costs or contributionmargin. You will have to round the number of units to break even,since you cannot sell a partial unit. Remember to always round upfor break even, no matter what the decimal. Use the new totalproduct cost in Q17a.
Mannarelli Corporation uses the FIFO method in its processcosting system. Operating data for the Casting Department for themonth of September appear below:
| Units | PercentComplete with Respect to Conversion | |
| Beginning workin process inventory | 19,000 | 25% |
| Transferred infrom the prior department during September | 99,000 | |
| Ending work inprocess inventory | 29,000 | 90% |
According to the company's records, the conversion cost inbeginning work in process inventory was $16,160 at the beginning ofSeptember. Additional conversion costs of $531,556 were incurred inthe department during the month. |
The cost per equivalent unit for conversion costs for Septemberis closest to (Round off to three decimal places.): |
$4.642
$4.817
$5.369
$4.669
During February, Degan Inc. transferred $55,000 from Work inProcess to Finished Goods and recorded a Cost of Goods Sold of$60,000 (assume there was enough beginning balance in the Finishedgoods inventory account). The journal entries to record thesetransactions would include a:
credit to Finished Goods of $55,000
debit to Finished Goods of $60,000
credit to Cost of Goods Sold of $60,000
credit to Work in Process of $55,000
Carr Company produces a single product. During the past year,Carr manufactured 42,000 units and sold 28,500 units. Productioncosts for the year were as follows:
| Fixed manufacturing overhead | $ 420,000 |
| Variable manufacturing overhead | $ 525,000 |
| Direct labor | $ 344,400 |
| Direct materials | $ 445,200 |
Sales totaled $2,137,500, variable selling expenses totaled$424,200, and fixed selling and administrative expenses totaled$187,000. There were no units in beginning inventory. Assume thatdirect labor is a variable cost.
Under absorption costing, the ending inventory for the year wouldbe valued at (Do not round your intermediate calculations.):
$557,550
$646,129
$752,657
$711,284
| The followingdata were taken from the accounting records of Abacus Company whichuses the FIFO method in its process costing system: |
| Beginning work in process inventory: | 30,000 units(materials 100% complete, labor and overhead 70% complete) |
| Started in process during the period: | 100,000units |
| Endingwork in process inventory: | 40,000 units(materials 100% complete, labor and overhead 80% complete) |
The equivalent units are:
Material, 134,000 units; labor and overhead, 132,000 units
Material, 130,000 units; labor and overhead, 122,000 units
Material, 100,000 units; labor and overhead, 101,000 units
Material, 91,000 units; labor and overhead, 83,000 units
Budget data for the Bidwell Company are as follows:
| Sales (170,000 units) | $1,700,000 | ||
| Expenses: | Fixed | Variable | |
| Raw materials | $ 510,000 | ||
| Direct labor | 340,000 | ||
| Overhead | $ 170,000 | 255,000 | |
| Selling and administrative | 187,000 | 85,000 | |
| Total expenses | $ 357,000 | $ 1,190,000 | 1,547,000 |
| Netoperating income | $ 153,000 |
| The number ofunits Bidwell would have to sell to earn a net operating income of$255,000 is: |
170,000 units
119,000 units
204,000 units
255,000 units
DeAnne Company produces a single product. The company's variablecosting income statement for August appears below:
| DeAnne Company Income statement For the month ended August 31 | |
| Sales ($21 per unit) | $1,134,000 |
| Variable expenses: | |
| Variable cost of goods sold | 486,000 |
| Variable selling expense | 108,000 |
| Total variable expenses | 594,000 |
| Contribution margin | 540,000 |
| Fixed expenses: | |
| Fixed manufacturing | 147,000 |
| Fixed selling and administrative | 49,000 |
| Total fixed expenses | 196,000 |
| Netoperating income | $344,000 |
The company produced 49,000 units in August and the beginninginventory consisted of 22,000 units. Variable production costs perunit and total fixed costs have remained constant over the pastseveral months.
The value of the company's inventory on August 31 under theabsorption costing method is (Do not round your intermediatecalculations.):
$204,000
$238,000
$153,000
$253,426
Candice Corporation has decided to introduce a new product. Theproduct can be manufactured using either a capital-intensive orlabor-intensive method. The manufacturing method will not affectthe quality or sales of the product. The estimated manufacturingcosts of the two methods are as follows:
| Capital-Intensive | Labor-Intensive | |||||||
| Variable manufacturing cost per unit | $ | 14.00 | $ | 17.60 | ||||
| Fixed manufacturing cost per year | $ | 2,606,000 | $ | 1,417,600 | ||||
The company's market research department has recommended anintroductory selling price of $30 per unit for the new product. Theannual fixed selling and administrative expenses of the new productare $600,000. The variable selling and administrative expenses are$2 per unit regardless of how the new product is manufactured. |
Required: | |
| a. | Calculate the break-even point in units if Candice Corporationuses the (Do not round intermediatecalculations.): |
| Break-evenpoint in units | |
| Capital-intensive manufacturing method | |
| Labor-intensive manufacturing method | |
| b. | Determine the unit sales volume at which the net operatingincome is the same for the two manufacturing methods. (Donot round intermediate calculations. Round your answer to thenearest whole number.) |
| Sales volume |
| c. | Assuming sales of 440,000 units, what is the degree of operatingleverage if the company uses the: (Do not roundintermediate calculations. Round your answers to 2 decimalplaces.) |
| Degree ofoperating leverage | |
| Capital-intensive manufacturing method | |
| Labor-intensive manufacturing method | |
| d. | What is your recommendation to management concerning whichmanufacturing method should be used, if the sales volume is inexcess of the one calculated under Requirement (b)? | ||||
|
| Hickory Company manufactures two productsâ13,000 units ofProduct Y and 5,000 units of Product Z. The company uses aplantwide overhead rate based on direct labor-hours. It isconsidering implementing an activity-based costing (ABC) systemthat allocates all of its manufacturing overhead to four costpools. The following additional information is available for thecompany as a whole and for Products Y and Z: (The totalestimated overhead cost may not agree with the sum of allocatedoverhead costs to each product.)
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Ermoin Inc. uses the FIFO method in its process costing system.The following data concern the operations of the company's firstprocessing department for a recent month.
| Workin process, beginning: | |||||
| Units in process | 2,400 | ||||
| Percent complete with respect tomaterials | 70 | % | |||
| Percent complete with respect toconversion | 30 | % | |||
| Costs in the beginning inventory: | |||||
| Materials cost | $ | 4,140 | |||
| Conversion cost | $ | 6,265 | |||
| Units started into production during the month | 17,900 | ||||
| Units completed and transferred out | 17,900 | ||||
| Costs added to production during the month: | |||||
| Materials cost | $ | 165,490 | |||
| Conversion cost | $ | 560,270 | |||
| Workin process, ending: | |||||
| Units in process | 2,400 | ||||
| Percent complete with respect tomaterials | 50 | % | |||
| Percent complete with respect toconversion | 30 | % | |||
| Required: |
Using the FIFO method: |
| a. | Determine theequivalent units of production for materials and conversioncosts. |
| Materials | Conversion | |
| Equivalent units of production | ||
| b. | Determine the cost per equivalent unit for materials andconversion costs. (Round your answers to 2 decimalplaces.) |
| Materials | Conversion | |
| Costper equivalent unit | $ | $ |
| c. | Determine the cost of ending work in process inventory.(Round your intermediate calculations to 2 decimal placesand final answer to the nearest dollar amount.) |
| Costof ending work in process inventory | $ |
| d. | Determine the cost of units transferred out of the departmentduring the month. (Round your intermediate calculations to2 decimal places and final answer to the nearest dollaramount.) |
| Costof units transferred out | $ |
