Acct 5210- accounting problems

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Description

This homework
assignment is worth 25 points that will be awarded based on the following:

Points

QUESTIONS 1–7, 9–11, 14, 16–19 1 point
each

15

QUESTIONS 8, 12, 13, 15, 20 2 points each

10

TOTAL

25

1.
(1 point) Aesop Douglas plans
on selling autographed souvenir rugs at the Olympics. Based on similar events, he has the following
projected figures:

Selling price per rug

$170.00

Contribution margin per rug

$60.00

Total fixed costs

$125,500

What selling price per rug would be
needed to obtain a before-tax profit of $189,500 at a volume of 3,500 rugs?

a.
$ 90.00

b.
$110.00

c.
$150.00

d.
$170.00

e.
$200.00

f.
$230.00

g.
$260.00

h.
None of the above.

2.
(1 point) The following
information pertains to Butter, Inc. for the month of June:

Beginning work-in-process inventory
$ 110,000

Ending work-in-process inventory
$ 80,000

Cost of goods manufactured $ 350,000

Manufacturing overhead $ 170,000

If prime costs
are 75% of conversion costs, what was the direct labor cost incurred for June?
a.$112,500

b.
$200,000

c.
$90,000

d.
$30,000

e.
$20,000

f.
$127,500

g.
$150,000

h.
None of the above

3. (1 point) Abbagnale Enterprises will ship all of the USA athletes’
gear to Russia for the Olympics. The
company has the following historical information based on similar trips taken
overseas:

Trip Nautical
Miles Operating
Costs

1
500,000 $356,000

2
580,000 $380,000

3
660,000 $420,000

What is the best estimate of total
operating costs using the high-low method if the expected mileage for the trip
to Russia is 590,000 miles?

a.
$236,000

b.
$375,455

c.
$386,552

d.
$386,441

e.
$392,000

f.
$391,977

g.
$420,080

h.
None of the above

4.
(1 point) Jones Manufacturing
reports that finished goods inventory was $14,000 on April 1 and $16,500 on
April 30. Beginning and ending work-in-process inventories were $12,000 and
$24,000, respectively. If cost of goods sold for the month of April was
$80,000, what was the cost of goods manufactured during April?

a.
$82,500

b.
$49,500

c.
$68,500

d.
$77,500

e.
$110,500

f.
$92,000

g.
$96,500

h.
None of the above

5.
(1 point) Cash Company has a
predetermined overhead rate of $4 per machine hour. Last year the company
incurred $112,400 of actual manufacturing overhead cost and the account was
$4,200 over-applied. How many machine hours were used during the year?

a.
16,800 machine hours

b.
20,000 machine hours

c.
28,100 machine hours

d.
30,200 machine hours

e.
27,050 machine hours

f.
29,150 machine hours

g.
28,250 machine hours

h.
None of the above.

6.
(1 point) The Adams Corporation
has the following data for 2014:

Units
sold 10,000
units

Total
fixed costs $48,000

Selling
price per unit $20

Variable
cost per unit $12

The margin of safety in units (round
to the nearest whole unit) and operating leverage are, respectively:

a.
2,000 units; 2.5.

b.
2,000 units; 1.67.

c.
4,000 units; 2.5.

d.
4,000 units; 1.67.

e.
6,000 units; 2.5.

f.
6,000 units; 1.67

g.
0 units; 1.67

h.
None of the above.

Use the following information
to answer questions the next two questions:

Nicoll, Inc., completed
the following jobs during 2014:

Job 10

Job 20

Direct materials

$350

$1,200

Direct labor

$345

$1,350

Units completed

100

360

Direct labor hours

30

80

Number of setups

7

3

Number of orders

7

4

Machine hours

60

32

Kilowatt hours

125

150

At the
beginning of 2014, the company identified the following overhead costs and
activity drivers:

Expected

Expected

Expected

Expected

Overhead
Activity

Cost

Activity Driver

Quantity

Setups

$120,000

Number of setups

400

Ordering

$ 70,000

Number of orders

250

Maintenance

$180,000

Machine hours

3,000

Power

$ 30,000

Kilowatt hours

75,000

The company’s
normal activity is 5,000 direct labor hours.

7.
(1 point) If Nicoll, Inc. uses
direct labor hours in a traditional costing system to assign overhead, what is
the total cost of Job 10?

a.
$2,400

b.
$8,950

c.
$2,550

d.
$6,550

e.
$3,095

f.
$8,405

g.
$5,495

h.
None of the above

8.
(2 points) If Nicoll, Inc. uses
an activity-based costing system to assign overhead, what is the total cost of
Job 20?

a.
$3,095

b.
$4,950

c.
$5,110

d.
$5,650

e.
$8,405

f.
$8,950

g.
$6,550

h.
None of the above

9.
(1 point) The work-in-process
of Parrott Corporation increased $11,500 from the beginning to the end of
November. Costs incurred during November
included $12,000 for direct materials, $63,000 for direct labor, and $21,000
for overhead. What was the cost of goods
manufactured during November?

a.
$11,500

b.
$84,500

c.
$74,500

d.
$75,000

e.
$107,500

f.
$95,500

g.
$96,000

h.
None of the above

10. (1 point) Information from the records of Place, Inc., for the month
of December is as follows:

Sales

$962,000

Direct materials purchases

$188,000

Direct labor

$280,000

Direct materials, December 1

$ 25,000

Work in process, December 1

$ 37,000

Finished goods, December 1

$120,000

Direct materials, December 31

$ 11,000

Work in process, December 31

$ 85,000

Finished goods, December 31

$ 55,000

Factory overhead

$290,000

Selling and administrative expenses

$170,000

The operating income (loss) for the
month of December is

a.
$(148,000)

b.
$(117,000)

c.
$3,000

d.
$20,000

e.
$34,000

f.
$68,000

g.
$173,000

h.
None of the above

Use the following information
to answer the next two questions:

Fred’s Frozen Creations has been
contracted to train the USA’s synchronized ice sculpting team. They have identified two different
independent variables (ice sculpting hours and number of ice blocks used in
training) in two different equations to evaluate the cost of training. The
results of the two regressions are as follows:

SUMMARY OUTPUT – Sculpting hours

.gif”>

Regression Statistics

Multiple R

0.6986

R Square

0.4532

Adjusted R Square

0.3143

Standard Error

$40,587

Observations

24

Coefficients

Standard Error

t
Stat

P-value

Intercept

$1,214.35

$398.12

3.05

0.0254

Sculpting hours

$21.90

$7.71

2.84

0.1200

SUMMARY OUTPUT – Number of ice blocks

.gif”>

Regression Statistics

Multiple R

0.6145

R Square

0.3320

Adjusted R Square

0.2874

Standard Error

$43,127

Observations

24

Coefficients

Standard Error

t
Stat

P-value

Intercept

$6,764.58

$2,073.09

3.26

0.0125

Number of blocks

$223.48

$69.83

3.20

0.0240

11. (1 point) Using the best cost driver,
what is the estimated total cost of training these athletes if 12,300 sculpting
hours are incurred and Fred’s uses 1,190 ice blocks during training? Assume
these estimates are within the relevant range.

a.
$27,275.35

b.
$96,047.35

c.
$272,705.78

d.
$296,645.35

e.
$270,584.35

f.
$303,409.73

g.
$309,957.00

h.
None of the above

12. (2 points) Assume Fred’s Frozen Creations chooses to use the number
of ice blocks to estimate the cost of training. Construct a 90% confidence
interval for the cost of training when the number of ice blocks used is
estimated at 1,300. Assume 1,300 ice blocks is within the relevant range.
(Round all calculations to the nearest dollar)

a.
($223,240, $371,338)

b.
($211,035, $383,543)

c.
($227,601, $366,977)

d.
($196,535, $344,633)

e.
($207,844, $386,734)

f.
($189,817, $404,761)

g.
($223,499, $371,079)

h.
None of the above.

13. (2 point) Eden Company manufactures two products, Brights and Dulls,
from a joint process. The cost of the joint process is $50,000 and results in
250 units of Brights and 1,000 units of

Dulls. Both products must be
processed past the split-off point, incurring separable costs for

Brights of $60 per unit and $40 per
unit for Dulls. The market price is $250 for Brights and $200 for Dulls. What is the amount of
joint costs allocated to Brights using the net realizable value method?

a.
$10,000

b.
$11,446

c.
$25,000

d.
$27,143

e.
$27,778

f.
$30,000

g.
$50,000

h.
None of the above

Use the following information
to answer the next two questions:

Jay Manufacturing Company has two support
departments, Maintenance and Personnel, and two producing departments, A and B.
The Maintenance Department costs of $40,000 are allocated on the basis of
standard service hours used. The Personnel Department costs of $6,000 are
allocated on the basis of number of employees. The direct overhead costs of
Departments A and B are $8,000 and $20,000, respectively. The company provided the following data:

Maint.

Person.

Dept.

Dept.

Dept.

Dept.

A

B

Standard service hours used

90

100

630

270

Number of employees

120

60

200

200

Direct labor hours

125

125

500

250

14. (1 point) What are the total overhead costs associated with
Department B after allocating the Maintenance and Personnel Departments using
the direct method? (Hint: You are finding
the TOTAL cost in Department B after all allocations).

a.
$31,000

b.
$32,200

c.
$35,000

d.
$36,333

e.
$38,667

f.
$39,000

g.
$41,800

h.
None of the above

15. (2 points) What are the total overhead costs associated with
Department B after allocating the Maintenance and Personnel Departments using
the step (sequential) method? Assume the
company allocates the cost of the Maintenance department first. (Hint: You are
finding the TOTAL cost in Department B after all allocations).

a.
$32,080

b.
$32,800

c.
$35,000

d.
$38,200

e.
$39,000

f.
$35,800

g.
$41,920

h.
None of the above

16. (1 point) If a company’s contribution margin ratio is 0.40, targeted
after tax net income is $28,000 (tax rate of 30%), and targeted sales volume in
dollars is $300,000, then total fixed costs are:

a.
$ 43,333

b.
$ 80,000

c.
$ 92,000

d.
$118,000

e.
$140,000

f.
$152,000

g.
$213,333

h.
None of the above

17. (1 point) Eden Company manufactures two products, Brights and Dulls,
from a joint process. The cost of the joint process is $50,000 and results in
250 units of Brights and 1,000 units of

Dulls. Both products must be
processed past the split-off point, incurring separable costs for

Brights of $60 per unit and $40 per
unit for Dulls. The market price is $250 for Brights and $200 for Dulls. What is the gross profit for Brights assuming the physical
units method is used?

a.
$12,500

b.
$17,500

c.
$18,000

d.
$35,500

e.
$42,500

f.
$47,500

g.
$62,500

h.
None of the above

Use the following information
to answer the next two questions:

Holms Company
has a job-order costing system and uses a predetermined overhead rate based on
direct labor-hours to apply manufacturing overhead to jobs. Manufacturing
overhead cost and direct labor hours were estimated at $400,000 and 80,000
hours, respectively, for the year. In May, Job #158 was completed at a cost of
$6,000 in direct materials and $4,000 in direct labor. The labor rate is $8 per
hour. By the end of the year, Holms had worked a total of 75,000 direct
labor-hours and had incurred $365,500 actual manufacturing overhead cost.

18. (1 point) The total cost of Job #158 recorded on the completed job
cost sheet would be: a.$ 8,500

b.
$10,000

c.
$11,600

d.
$12,003

e.
$12,667

f.
$12,500

g.
$14,000

h.
None of the above

19. (1 point) Holms’ manufacturing overhead for the year was:

a. $1,500 under-applied

b. $1,500 over-applied

c.
$25,000 under-applied

d.
$25,000 over-applied

e.
$9,500 under-applied

f.
$9,500 over-applied

g.
$34,500 under-applied

h.
$34,500 over-applied

i.
None of the above

20. (2 points) Tier Inc. sells two products – Small and Large. The
company has the following information available:

Small Large Total

Variable cost per unit $18 $28

Contribution margin ratio 40%
20%

Total fixed costs $60,000

Assuming a constant mix of 3 units of
Small for 2 units of Large, what is the breakeven point in units? (round all
ratios to 4 decimal places)

a.
1,637 units of Small and 1,091
units of Large

b.
3,600 units of Small and 2,400
units of Large

c.
2,667 units of Small and 4,000
units of Large

d.
3,375 units of Small and 2,625
units of Large

e.
3,000 units of Small and 2,000
units of Large

f.
2,400 units of Small and 3,600
units of Large

g.
1,895 units of Small and 1,263
units of Large

h.
None of the above

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