Questions from General Accounting

Q: Magic Floor produces and sells a complete line of floor care products

Magic Floor produces and sells a complete line of floor care products: wax strippers, floor soaps, and floor waxes. All of these products are packaged on a new high-speed bottling fill line. Empty bot...

Q: Lys Wheels manufactures high-performance mountain bikes. Lys uses a

Lys Wheels manufactures high-performance mountain bikes. Lys uses a predetermined overhead rate based on direct labor hours to absorb overhead to mountain bikes. For the last fiscal year, the firm had...

Q: The following data summarize the operating performance of your company’s wholly owned

The following data summarize the operating performance of your company’s wholly owned Canadian subsidiary for 2009 to 2011. The cost of capital for this subsidiary is 10 percent. Req...

Q: You are evaluating ways to expand an optometry practice and its earnings

You are evaluating ways to expand an optometry practice and its earnings capacity. Optometrists perform eye exams, prescribe corrective lenses (eyeglasses and contact lenses), and sell corrective lens...

Q: IVAX manufactures commercial brushes in two operating divisions (O1 and O2

IVAX manufactures commercial brushes in two operating divisions (O1 and O2) and has two service departments (Human Resources and Janitorial/Maintenance). The two service departments’...

Q: Ab Landlord owns a dilapidated 30-year-old apartment building

Ab Landlord owns a dilapidated 30-year-old apartment building in Los Angeles. The net cash flow from renting the apartments last year was $200,000. She expects that inflation will cause the net cash f...

Q: Pebble Beach Sandals has designed and patented a luxury golf sandal for

Pebble Beach Sandals has designed and patented a luxury golf sandal for both men and women. The unique handmade designs include spikes and cleats to prevent the golfer from slipping during the swing....

Q: To generate needed foreign exchange, the Cuban government entered into a

To generate needed foreign exchange, the Cuban government entered into a joint venture with Domingo Cigars of Spain. The joint venture manufactures Domingo Cigars in Cuba using Cuban tobacco and emplo...

Q: A plant manufactures two products, Hi-V and Lo-

A plant manufactures two products, Hi-V and Lo-V. Hi-V is the high-volume product that represents most of the plant’s revenue. It is produced 10 times per year, inventoried, and ship...

Q: Software Associates (SA) is a computer software consulting firm that

Software Associates (SA) is a computer software consulting firm that specializes in designing and implementing integrated marketing database warehousing programs. Humphrey Catalog is a client. In prep...