Njombe Corporation manufactures a variety of products. In the past, Njombe has been using a traditional costing system in which the predetermined overhead rate was 150% of direct labor cost. Selling prices had been set by multiplying total product cost by 200%. Sensing that this system was distorting costs and selling prices, Nj
Managerial Accounting -------------------------------------------------------------------------------- Pricher Corporation's income statement for last year appears below: Sales 2,000,000 Cost of goods sold: Direct materials 500,000 Direct labor (variable) 150,000 Variable manufacturing overhead
Company X sold 25,000 units of product last year. The contribution margin per unit was 2, and fixed expenses totaled 40,000 for the year. This year fixed expenses are expected to increase to 45,000, but the contribution margin per unit will remain unchanged at 2. How many units must be sold this year to earn the same net operati
A company that makes organic fertilizer has supplied the following data: Bags produced and sold 240,000 Sales revenue 1,896,000 Variable manufacturing expense 804,000 Fixed manufacturing expense 520,000 Variable selling and administrative expense 180,000 Fixed selling and administrative expense 270,000
A cement manufacturer has supplied the following data: Tons of cement produced and sold 220,000 Sales revenue 924,000 Variable manufacturing expense 297,000 Fixed manufacturing expense 280,000 Variable selling and administrative expense 165,000 Fixed selling and administrative expense 82,000 Net oper
Pricher Corporation's income statement for last year appears below: Sales 2,000,000 Cost of goods sold: Direct materials 500,000 Direct labor (variable) 150,000 Variable manufacturing overhead 50,000 Fixed manufacturing overhead 600,000 1,300,000 Gross margin 700,000 Selling and ad
Drake Company's income statement for the most recent year appears below: Sales (26,000 units) 650,000 Less: Variable expenses 442,000 Contribution margin 208,000 Less: Fixed expenses 234,000 Net operating loss (26,000) Reference: 6-3 The unit contribution margin is:
The number of X-rays taken and X-ray costs over the last nine months in Beverly Hospital are given below: Month: X-ray taken X-ray costs January 6,250 $28,000 Februray 7,000
Please look this over and let me know what you think. The company intends to classify these costs and expenses into the following categories: (a) direct materials, (b) direct labor, (c) manufacturing overhead, and (d) period costs. Instructions List the items (1) through (10). For each item, indicate the cost category t
The management of Casablanca Manufacturing Corporation believes that machine-hours is an appropriate measure of activity for overhead cost Shown below are machine-hours and total overhead costs for the past six months: Machine- Overhead Hours Cost Jan 150,000 339,000 Feb 140,000 328,000 Mar 160,000 350,0
If the activity level increases, then one would expect the variable cost per unit to increase as well. True False
Cosco, Inc. has accumulated the following data for the cost of maintenance on its machinery for the last four months: Month Maintenance Cost Machine Hours September 26,020 21,000 October 24,600 18,500 November 22,300 15,000 December 25,100 19,000. Assume that the relevant range includes all of the activit
Calculation of fixed costs on a per unit basis is critical for internal reporting to managers. True False
The following costs were incurred in May: Direct materials........................................................................... $41,000 Direct labor................................................................................. $13,000 Manufacturing overhead.....................................................
Leija Manufacturing Company uses a job-order costing system and started the month of March with one job in process (Job #359). This job had $500 of cost assigned to it at this time. During March, Leija assigned production costs as follows to the jobs worked on during the month:
Darvin Company uses the weighted-average method in its process costing system. The first processing department, the Welding Department, started the month with 20,000 units in its beginning work in process inventory that were 10% complete with respect to conversion costs. The conversion cost in this beginning work in process inve
Gunes Corporation uses the weighted-average method in its process costing system. This month, the beginning inventory in the first processing department consisted of 800 units. The costs and percentage completion of these units in beginning inventory were: Cost Percent Complete Materials costs 10,600 65% Conversio
Here are account balances as of December 31, 2003: Cash - $12,000 Accounts Payable - $24,000 Accounts Receivable - $50,000 Salary Payable - $5,000 Trust Account - $40,000 Insurance - $1,000.00 Inventory - $10,000 Accumulated Depreciation - $4,200 Depreciation Exp - $4,800 Notes Payable - $5,000 Retained Earnings - $
Compute the Predetermined Overhead Rate [LO] Harris Fabrics computes its predetermined overhead rate annually on the basis of direct labor hours. At the beginning of the year it estimated that its total manufacturing overhead would be $134,000 and the total direct labor would be 20,000 hours. Its actual total manufacturing overh
How are cost standards developed? Discuss the purpose for cost standards.
Product Cost Flows; Product versus Period Costs [LO2, LO3] The Devon Motor Company produces motorcycles. During April, the company purchased 8,000 batteries at a cost of $10 per battery. Devon withdrew 7,600 batteries from the storeroom during the month. Of these, 100 were used to replace batteries in motorcycles used by the com
Preparation of a Schedule of Cost of Goods Manufactured and Cost of Goods Sold [LO1, LO3, LO4] The following cost and inventory data are taken from the accounting records of Mason Company for the year just completed: Costs incurred: Direct labor cost $70,000 Purchases of raw materials $118,
Differential, Opportunity, and Sunk Costs [LO7] Northwest Hospital is a full-service hospital that provides everything from major surgery and emergency room care to outpatient clinics. The hospital's Radiology Department is considering replacing an old inefficient X-ray machine with a state-of-the-art digital X-ray machine. The
Classification of Costs as Fixed or Variable [LO5] Below are a number of costs that are incurred in a variety of organizations. Required: Classify each cost as being variable or fixed with respect to the number of units of product or services sold by the organization. Cost Behavior Cost ------------
Exercise 2-4: Prepare a Schedule of Cost of Goods Manufactured [LO4] Lompac Products manufactures a variety of products in its factory. Data for the most recent month's operations appear below: Beginning raw materials inventory $60,000 Purchases of raw materials $690,000 Ending raw materials inventory $45,000
Preparation of a schedule of costo goods Manufactured and cost goods sold. The following cost and inventory data for the just completed year are taken from the accounting records of eccfles company: Cost incurred: Advertising Expense:..............................$100,000 Direct labor cost..............................
A company is a merchanding company that used the periodic inventory system. the data below if the from the accounting records for the year ended dec 31, 2004 calculate cost of goods sold for 2004, show all calculations: sales revenue-585,000 sales discounts-3,000 purchases-420,000 purchase returns and allowances-5,000 in
Determine the gross profit ration using the following info: sales 830,000 cost of sales 320,000 income tax expense 120,000 selling expenses 40,000 general and administrative expenses 100,000
Calculate the book value per share: common stock, $1 par, 100,000 shares authorized-$80,000 additional paid in capital common-60,000 retained earnings-40,000 total contributed capital and retained earnings-180,000 less treasury stock (2,000 common shares at cost)-20,000 total stockholders equity 160,000
A company purchased a trunk on Jan 1, 2002 for $40,000. The truck has an estimated life of 6 years and an estimated residual value of $4,000. The company used the straight-line method to depreciate the asset. On July 1, 2004, the truck was sold for $14,000 csh. What's the gain or loss on the sale?