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Accounting

Compute factory overhead rate; prepare flexible budget; determine variances

Question 1) Arlon Co. manufactures three types of cookies. Fluffs, Crinkles, and Snaps. The production process is relatively simple, and factory overhead costs are allocated to products using a single plant-wide factory rate based on direct labor hours. Information for the month of May 2008, Arlon's first month of operatio

three sectors of an economy

Describe a scenario for the production and consumption of a product that involves all three sectors of an economy. Explain what each sector contributes to the transactions and what each sector receives. Which sector benefits the most from the transactions involved and why? The three sectors of an economy are business,

Compare the liquidation of 3 investments for greatest after tax amount.

Please help with the following problem. Consider three investors who need to partially liquidate investments to raise cash. In this case all investments have been held for 3 or more years. Investor A waited for a $1,500 qualified dividend distribution from her mutual fund, and investor B received $1,500 in interest income fr

Cost drivers; Compute allocation rate for indirect cost

The owner of the gym Mr. Ripple, has notified division managers that their job performance evaluations will by highly influenced by their ability to minimize costs. The gym has three division weight lifting, aerobics and spinning. The owner has formulated a report showing how much it cost to operate each of three divisions last

Introduction to Accounting Information Systems

1. Why do auditors prepare analytic flowcharts of processing systems? 2. Is flow charting useful in analyzing the resources required to implement a system? If so, explain its benefits towards implementing a system.

Standard versus budget, optimum levels, variances, WIP

Question 1 Consider the following statements. Statement A: A standard is a unit amount. Statement B: A budget is a total amount. Option 1: Statement A is true and Statement B is false Option 2: Statement A is false and Statement B is true Option 3: Both Statements A and B are true Option 4: Both Statements A and B

Partnership Liquidation - ABC Partnership

Partnership Liquidation The balance sheet of the ABC partnership just prior to liquidation appears below: ABC PARTNERSHIP Balance Sheet December 31, 2010 Assets Liabilities and Owners' Equity Cash $ 70,000 Liabilities $120,000 Noncash assets 190,000 Agler, Capital 20,000 Bell, Capital 80,000 Colaw, Capital

Accounting Problem: Don's aunt Natalie gave him a house

Please help with the following problem. Provide step by step calculations. During the current year, Don's aunt Natalie gave him a house. At the time of the gift, the house had a FMV of $42,000 and his aunt's adjusted basis was $32,000. After deducting the annual exclusion, the amount of the gift was $30,000. His aunt paid

I:8-13 Passive activities rules for Laura's rentals; Kami's partnerships

I:8-13 Which of the following activities are considered passive for the year? Explain. Consider each situation independently. a. Laura owns a rental unit that she rents out to students. The rental unit is Laura's only business and she spends approximately 875 hours per year managing, collecting the rent, advertising, and

Spain Inn: method of financing to maximize EPS, stock issue or debt

1. Spain Inn has a total value of $21 million. Its stock sells at $32 a share. At present, it has a loan of $5 million at 8% interest. It needs $3 million to renovate the building. It can get the financing by selling 100,000 shares of stock at $30 (net) per share, or by borrowing the money at 9% interest. The expected EBIT after

Holding Period Return, After Tax HPR, Jensen Alpha, etc.

Scenario: Mary and Nick Stalcheck have an investment portfolio containing 4 vehicles. The portfolio contains common stock, industrial bonds, mutual fund shares and options. They are interested in measuring the return on their investment and assessing how well they have done relative to the market. They hope that the return e

Effect of large transaction; Compute Global's EBIT, income, P/E

1. Suppose your firm receives a $5 million order on the last day of the year. The customer picks up the entire order the same day and pays $1 million in upfront in cash; you also issue a bill for the customer to pay the remaining balance of $4 million within 30 days. Suppose your firms tax rate is 0 (ignore taxes). Determine the

Compute Value of Equity, Net Income, Retained Earnings

See the attached file. 2-1 Total Assets Use the following information, compute total assets. Equipment . . . . . . . . . . . . . . . $10,000 Accounts payable . . . . . . . . ....... 900 Capital stock . . . . . . . . . . . . .... 1,500 Cash . . . . . . . . . . . . . . . . . . ....... 800 Loan payable . . . . .

Accounting: Plant assets, Depreciation, Prepaid insurance, interest on a note

1. A main accounting issue for plant assets is: A) Computing the cost of the plant assets. B) Matching the costs of plant assets against revenues for the periods they benefit. C) Accounting for repairs and improvements to plant assets. D) The disposal of plant assets. E) All of the above. 2. Nelson Company purcha

Questions Involving Sales and Production

Sell or process further (adapted from CMA exam) The department of Biggs Company is considering a proposal to install a third production department within its exiting factory building. With the company's present production setup, 200.000 pounds per year of direct materials pass through Department 1 to Produce 100,000 pounds each

Waldo and Company: Transfer pricing in a service business

Waldo and Company, LLP, is a partnership that provides public accounting services. Waldo has three offices located in New Orleans, Baton Rouge, and Lafayette. Each of the offices employs approximately 30 professional accountants who are hired by and work solely for the office to which they are assigned. The offices are run indep

Michigan Mining and Manufacturing has a debt obligation

Michigan Mining and Manufacturing has a debt obligation of $100 million and assets with a value of $90 million. This debt must be paid off very shortly. When this happens, the value of the debt will be $90 million and the value of equity will be $0. Prior to paying off the debt, MMM has an opportunity to make a high-risk investm

Change in Accounting Principles and Financial Statements

BE13- 1 On June 30 Rojas Corporation discontinued its operations in Mexico. On September 1 Rojas disposed of the Mexico facility at a pretax loss of $ 480,000. The applicable tax rate is 25%. Show the discontinued operations section of Rojas's income statement. BE13- 3 On January 1, 2007, Cannon Inc. changed from the LIFO met

Journal Entries Necessary for Accounts

See the attached file. 1. On July 23, Plitt Company factored $300,000 in accounts receivable for cash of $280,000. The factor withheld 7 percent of the cash proceeds to allow for possible customer returns. An allowance for doubtful accounts of $13,000 had previously been established by Plitt in relation to these accounts.

Calculate variable overhead efficiency and spending variance: apply overhead

Company B's production budget for the year ended December 31, 2005 was based on 10,000 units. Each unit requires two standard hours of labor for completion. Total overhead was budgeted at $90,000 for the year, and the fixed overhead rate was estimated to be $6.00 per unit. Both fixed and variable overhead are assigned to the pro