Question: Alden Co.’s monthly sales and cost

> Use the following selected data from Business Solutions’s income statement for the three months ended March 31, 2016, and from its March 31, 2016, balance sheet to complete the requirements below: computer services revenue, $25,307; net sales (of goods)

> Santana Rey, owner of Business Solutions, decides to prepare a statement of cash flows for her business. (Although the serial problem allowed for various ownership changes in earlier chapters, we will prepare the statement of cash flows using the followi

> Milano Co. manufactures and sells three products: product 1, product 2, and product 3. Their unit selling prices are product 1, $40; product 2, $30; and product 3, $20. The per unit variable costs to manufacture and sell these products are product 1, $30

> This year Best Company earned a disappointing 5.6% after-tax return on sales (net income/sales) from marketing 100,000 units of its only product. The company buys its product in bulk and repackages it for resale at the price of $20 per unit. Best incurre

> Stam Co. produces and sells two products, BB and TT. It manufactures these products in separate factories and markets them through different channels. They have no shared costs. This year, the company sold 50,000 units of each product. Sales and costs fo

> Rivera Co. sold 20,000 units of its only product and incurred a $50,000 loss (ignoring taxes) for the current year as shown here. During a planning session for year 2016’s activities, the production manager notes that variable costs can

> Hip-Hop Co. manufactures and markets several products. Management is considering the future of one product, electronic keyboards, that has not been as profitable as planned. Since this product is manufactured and marketed independently of the other produ

> Sun Co.’s monthly sales and cost data for its operating activities of the past year follow. Management wants to use these data to predict future fixed and variable costs. (Dollar amounts are in thousands.) Required 1. Prepare a scatte

> The following costs result from the production and sale of 12,000 CD sets manufactured by Gilmore Company for the year ended December 31, 2015. The CD sets sell for $18 each. The company has a 25% income tax rate. Required 1. Prepare a contribution mar

> For each of the following three separate cases, use the information provided about the calendar-year 2016 operations of Sahim Company to compute the required cash flow information. Case X: Compute cash received from customers: Sales .... $515,000 Ac

> Belda Co. makes organic juice in two departments: cutting and blending. Direct materials are added at the beginning of each process, and conversion costs are added evenly throughout each process. The company uses the FIFO method of process costing. Durin

> During May, the production department of a process manufacturing system completed a number of units of a product and transferred them to finished goods. Of these transferred units, 62,500 were in process in the production department at the beginning of M

> Refer to the information in Problem 20-4B. Assume that Switch uses the FIFO method to account for its process costing system. The following additional information is available. * Beginning work in process consists of 10,000 units that were 75% complete w

> Switch Co. manufactures a single product in one department. Direct labor and overhead are added evenly throughout the process. Direct materials are added as needed. The company uses monthly reporting periods for its weighted-average process costing. Duri

> Braun Company produces its product through a single processing department. Direct materials are added at the beginning of the process. Conversion costs are added to the product evenly throughout the process. The company uses monthly reporting periods for

> Abraham Company uses process costing to account for its production costs. Conversion is added evenly throughout the process. Direct materials are added at the beginning of the process. During September, the production department transferred 80,000 units

> Dream Toys Company manufactures video game consoles and accounts for product costs using process costing. The company uses a single processing department. The following information is available regarding its June inventories. The following additional i

> King Company produces variations of its product, a megatron, in response to custom orders from its customers. On June 1, the company had no inventories of work in process or finished goods but held the following raw materials. On June 3, the company be

> In December 2014, Pavelka Company’s manager estimated next year’s total direct labor cost assuming 50 persons working an average of 2,000 hours each at an average wage rate of $15 per hour. The manager also estimated t

> Starr Mfg.’s predetermined overhead rate is 200% of direct labor. Information on the company’s production activities during September 2015 follows. a. Purchased raw materials on credit, $125,000. b. Materials requisiti

> The following transactions and events occurred during the year. Assuming that this company uses the direct method to report cash provided by operating activities, indicate where each item would appear on the statement of cash flows by placing an x in the

> Cavallo Mfg.’s computer system generated the following trial balance on December 31, 2015. The company’s manager knows that the trial balance is wrong because it does not show any balance for Work in Process Inventory

> Perez Mfg.’s August 31 inventory of raw materials is $150,000. Raw materials purchase in September are $400,000, and factory payroll cost in September is $232,000. Overhead costs incurred in September are: indirect materials, $30,000; i

> Shown here are annual financial data at December 31, 2015, taken from two different companies. Required 1. Compute the cost of goods sold section of the income statement at December 31, 2015, for each company. Include the proper title and format in the

> Racer’s Edge makes specialty skates for the ice skating circuit. On December 31, 2014, the company had (a) 1,500 skates in finished goods inventory and (b) 2,500 blades at a cost of $20 each in raw materials inventory. During 2015, Racer’s Edge purchase

> Using the information from Problem 18-2B and the inventory information for Best Bikes below, complete the requirements below. Assume income tax expense is $136,700 for the year. Required 1. Prepare the company’s 2015 schedule of cost

> The following calendar year-end information is taken from the December 31, 2015, adjusted trial balance and other records of Best Bikes. Required 1. Identify and classify each of the costs above as either a product or period cost. 2. Classify each of t

> Listed here are the total costs associated with the 2015 production of 15,000 Blu-ray Discs (BDs) manufactured by Maxwell. The BDs sell for $18 each. Required 1. Classify each cost and its amount as (a) either variable or fixed and (b) either product

> Selected account balances from the adjusted trial balance for Harbor Corp. as of its calendar year-end December 31, 2015, follow. Required Answer each of the following questions by providing supporting computations. 1. Assume that the companyâ&#1

> Summary information from the financial statements of two companies competing in the same industry follows. Required 1. For both companies compute the (a) current ratio, (b) acid-test ratio, (c) accounts (including notes) receivable turnover, (d) invent

> Selected year-end financial statements of Overton Corporation follow. (All sales were on credit; selected balance sheet amounts at December 31, 2014, were inventory, $17,400; total assets, $94,900; common stock, $35,500; and retained earnings, $18,800.)

> In 2015, Randa Merchandising, Inc., sold its interest in a chain of wholesale outlets, taking the company completely out of the wholesaling business. The company still operates its retail outlets. A listing of the major sections of an income statement fo

> Koto Corporation began the month of June with $300,000 of current assets, a current ratio of 2.5:1, and an acid-test ratio of 1.4:1. During the month, it completed the following transactions (the company uses a perpetual inventory system). June 1 Sold

> Selected comparative financial statement information of Bluegrass Corporation follows. Required 1. Compute each year’s current ratio. (Round ratio amounts to one decimal.) 2. Express the income statement data in common-size percents.

> Selected comparative financial statements of Tripoly Company follow. Required 1. Compute trend percents for all components of both statements using 2009 as the base year. (Round percents to one decimal.) Analysis Component 2. Analyze and comment on t

> Refer to Satu Company’s financial statements and related information in Problem 16-6B. Required Prepare a complete statement of cash flows; report its cash flows from operating activities according to the direct method. Information fr

> Refer to the information reported about Satu Company in Problem 16-6B. Required Prepare a complete statement of cash flows using a spreadsheet as in Exhibit 16A.1; report operating activities under the indirect method. Identify the debits and credits in

> Satu Company, a merchandiser, recently completed its 2015 operations. For the year, (1) all sales are credit sales, (2) all credits to Accounts Receivable reflect cash receipts from customers, (3) all purchases of inventory are on credit, (4) all debits

> Refer to Gazelle Corporation’s financial statements and related information in Problem 16-3B. Required Prepare a complete statement of cash flows; report its operating activities according to the direct method. Disclose any noncash inv

> Refer to the information reported about Gazelle Corporation in Problem 16-3B. Required Prepare a complete statement of cash flows using a spreadsheet as in Exhibit 16A.1; report its operating activities using the indirect method. Identify the debits and

> Gazelle Corporation, a merchandiser, recently completed its calendar-year 2015 operations. For the year, (1) all sales are credit sales, (2) all credits to Accounts Receivable reflect cash receipts from customers, (3) all purchases of inventory are on cr

> Refer to the information in Problem 16-1B. Required Prepare the cash flows from operating activities section only of the company’s 2015 statement of cash flows using the direct method. Information from Exercise 16-1B: Salt Lake Compan

> Refer to the information in Exercise 16-11. Using the direct method, prepare the statement of cash flows for the year ended June 30, 2015. Information from Exercise 16-11: The following financial statements and additional information are reported. Ad

> Salt Lake Company’s 2015 income statement and selected balance sheet data (for current assets and current liabilities) at December 31, 2014 and 2015, follow. Required Prepare the cash flows from operating activities section only of t

> Patriot Co. manufactures and sells three products: red, white, and blue. Their unit selling prices are red, $20; white, $35; and blue, $65. The per unit variable costs to manufacture and sell these products are red, $12; white, $22; and blue, $50. Their

> This year Burchard Company sold 40,000 units of its only product for $25 per unit. Manufacturing and selling the product required $200,000 of fixed manufacturing costs and $325,000 of fixed selling and administrative costs. Its per unit variable costs fo

> Henna Co. produces and sells two products, T and O. It manufactures these products in separate factories and markets them through different channels. They have no shared costs. This year, the company sold 50,000 units of each product. Sales and costs for

> Astro Co. sold 20,000 units of its only product and incurred a $50,000 loss (ignoring taxes) for the current year as shown here. During a planning session for year 2016’s activities, the production manager notes that variable costs can

> Praveen Co. manufactures and markets a number of rope products. Management is considering the future of Product XT, a special rope for hang gliding, that has not been as profitable as planned. Since Product XT is manufactured and marketed independently o

> The following costs result from the production and sale of 1,000 drum sets manufactured by Tight Drums Company for the year ended December 31, 2015. The drum sets sell for $500 each. The company has a 25% income tax rate. Required 1. Prepare a contribu

> Dengo Co. makes a trail mix in two departments: roasting and blending. Direct materials are added at the beginning of each process, and conversion costs are added evenly throughout each process. The company uses the FIFO method of process costing. During

> During May, the production department of a process manufacturing system completed a number of units of a product and transferred them to finished goods. Of these transferred units, 37,500 were in process in the production department at the beginning of M

> The following financial statements and additional information are reported. Additional Information a. A $30,000 note payable is retired at its $30,000 carrying (book) value in exchange for cash. b. The only changes affecting retained earnings are net

> Refer to the data in Problem 20-4A. Assume that Tamar uses the FIFO method to account for its process costing system. The following additional information is available: * Beginning work in process consisted of 3,000 units that were 100% complete with res

> Tamar Co. manufactures a single product in one department. All direct materials are added at the beginning of the manufacturing process. Conversion costs are added evenly throughout the process. During May, the company completed and transferred 22,200 un

> Fast Co. produces its product through a single processing department. Direct materials are added at the start of production, and conversion costs are added evenly throughout the process. The company uses monthly reporting periods for its weighted-average

> Victory Company uses weighted-average process costing to account for its production costs. Conversion cost is added evenly throughout the process. Direct materials are added at the beginning of the process. During November, the company transferred 700,00

> Sierra Company manufactures woven blankets and accounts for product costs using process costing. The company uses a single processing department. The following information is available regarding its May inventories. The following additional information

> Sager Company manufactures variations of its product, a technopress, in response to custom orders from its customers. On May 1, the company had no inventories of work in process or finished goods but held the following raw materials. On May 4, the comp

> In December 2014, Learer Company’s manager estimated next year’s total direct labor cost assuming 50 persons working an average of 2,000 hours each at an average wage rate of $25 per hour. The manager also estimated th

> Widmer Watercraft’s predetermined overhead rate for 2015 is 200% of direct labor. Information on the company’s production activities during May 2015 follows. a. Purchased raw materials on credit, $200,000. b. Materials

> Bergamo Bay’s computer system generated the following trial balance on December 31, 2015. The company’s manager knows something is wrong with the trial balance because it does not show any balance for Work in Process I

> Marcelino Co.’s March 31 inventory of raw materials is $80,000. Raw materials purchase in April are $500,000, and factory payroll cost in April is $363,000. Overhead costs incurred in April are: indirect materials, $50,000; indirect lab

> A company reported average total assets of $1,240,000 in 2014 and $1,510,000 in 2015. Its net operating cash flow was $102,920 in 2014 and $138,920 in 2015. Calculate its cash flow on total assets ratio for both years. Comment on the results and any chan

> The following transactions and events occurred during the year. Assuming that this company uses the indirect method to report cash provided by operating activities, indicate where each item would appear on its statement of cash flows by placing an x in t

> Compute the total manufacturing cost for a manufacturer with the following information for the month. Raw materials purchased.. Raw materials used in production.. $32,400 53,750 Direct labor used.. 12,000 Factory supervisor salary... 8,000 Salespers

> Compute cost of goods sold using the following information: Finished goods inventory, beginning $ 500 Cost of goods manufactured 4,000 Finished goods inventory, ending 750

> During the current month, a company that uses job order costing incurred a monthly factory payroll of $175,000. Of this amount, $44,000 is classified as indirect labor and the remainder as direct labor for the production of Job 65A. Factory overhead is a

> Refer to information in QS 23-5. Assume the actual cost to manufacture one metal bat was $40. Compute the cost variance and classify it as favorable or unfavorable. Information from QS 23-5: BatCo makes metal baseball bats. Each bat requires 1 kg of alu

> During the current month, a company that uses job order costing incurred a monthly factory payroll of $180,000. Of this amount, $40,000 is classified as indirect labor and the remainder as direct. Prepare journal entries to record these transactions.

> List the four components of a schedule of cost of goods manufactured and provide specific examples of each for Apple.

> This scatter diagram reflects past maintenance hours and their corresponding maintenance costs. 1. Draw an estimated line of cost behavior. 2. Estimate the fixed and variable components of maintenance costs. $12,000 10,000 8,000 6,000 4,000 2,000 1

> Mervon Company has two operating departments: mixing and bottling. Mixing has 300 employees and occupies 22,000 square feet. Bottling has 200 employees and occupies 18,000 square feet. Indirect factory costs for the current period follow: administrative,

> A recent income statement for Volkswagen reports the following (in € millions). Assume 75 percent of the cost of sales and 75 percent of the selling and administrative costs are variable costs, and the remaining 25 percent of each is fix

> A production department’s beginning inventory cost includes $394,900 of conversion costs. This department incurs an additional $907,500 in conversion costs in the month of March. Equivalent units of production for conversion total 740,000 for March. Calc

> A company’s Factory Overhead T-account shows total debits of $624,000 and total credits of $646,000 at the end of the year. Prepare the journal entry to close the balance in the Factory Overhead account to Cost of Goods Sold.

> During the current month, a company that uses job order costing purchases $50,000 in raw materials for cash. It then uses $12,000 of raw materials indirectly as factory supplies and uses $32,000 of raw materials as direct materials. Prepare journal entri

> An advertising agency is estimating costs for advertising a music festival. The job will require 200 direct labor hours at a cost of $50 per hour. Overhead costs are applied at a rate of $65 per direct labor hour. What is the total estimated cost for thi

> On March 1 a dressmaker starts work on three custom-designed wedding dresses. The company uses job order costing and applies overhead to each job (dress) at the rate of 40% of direct materials costs. During the month, the jobs used direct materials as sh

> A company allocates overhead at a rate of 150% of direct labor cost. Actual overhead cost for the current period is $950,000, and direct labor cost is $600,000. Prepare the journal entry to close over- or under-applied overhead to Cost of Goods Sold.

> Project A requires a $280,000 initial investment for new machinery with a five-year life and a salvage value of $30,000. The company uses straight-line depreciation. Project A is expected to yield annual net income of $20,000 per year for the next five y

> Siemens AG invests €80 million to build a manufacturing plant to build wind turbines. The company predicts net cash flows of €16 million per year for the next eight years. Assume the company requires an 8% rate of return from its investments. 1. What is

> Park Co. is considering an investment that requires immediate payment of $27,000 and provides expected cash inflows of $9,000 annually for four years. If Park Co. requires a 10% return on its investments, what is the net present value of this investment?

> Signal mistakenly produced 1,000 defective cell phones. The phones cost $60 each to produce. A salvage company will buy the defective phones as they are for $30 each. It would cost Signal $80 per phone to rework the phones. If the phones are reworked, Si

> Xia Co. currently buys a component part for $5 per unit. Xia believes that making the part would require $2.25 per unit of direct materials and $1.00 per unit of direct labor. Xia allocates overhead using a predetermined overhead rate of 200% of direct l

> For a recent year L’Oréal reported operating profit of €3,385 (in millions) for its cosmetics division. Total assets were €12,888 (in millions) at the beginning of the year and €13,099 (in millions) at the end of the year. Compute return on investment fo

> Compute and interpret (a) manufacturing cycle time and (b) manufacturing cycle efficiency using the following information from a manufacturing company. Process time ... 15 minutes Inspection time 2 minutes Move time 6.4 minutes Wait time 36.6 minut

> Mervon Company has two operating departments: mixing and bottling. Mixing has 300 employees and occupies 22,000 square feet. Bottling has 200 employees and occupies 18,000 square feet. Indirect factory costs for the current period follow: administrative,

> Walt Disney reports the following information for its two Parks and Resorts divisions. Assume Walt Disney uses a balanced scorecard and sets a target of 85% occupancy in its resorts. Using Exhibit 24.22 as a guide, show how the companyâ€&#15

> A company’s shipping division (an investment center) has sales of $2,420,000, net income of $516,000, and average invested assets of $2,250,000. Compute the division’s profit margin and investment turnover.

> Gordands purchased $600,000 of merchandise in August and expects to purchase $720,000 in September. Merchandise purchases are paid as follows: 25% in the month of purchase and 75% in the following month. Compute cash disbursements for merchandise for Sep

> Hotwax completed products costing $275,000 and transferred them to finished goods. Prepare its journal entry to record the transfer of units from production to finished goods inventory

> Following are selected accounts for a company. For each account, indicate whether it will appear on a budgeted income statement (BIS) or a budgeted balance sheet (BBS). If an item will not appear on either budgeted financial statement, label it NA.

> Prepare journal entries to record the following production activities for Hotwax. 1. Incurred direct labor of $125,000 (credit Factory Payroll Payable). 2. Incurred indirect labor of $10,000 (credit Factory Payroll Payable). 3. Total factory payroll of $

> Hotwax makes surfboard wax in a single operation. This period, Hotwax purchased $62,000 in raw materials. Its production department requisitioned $50,000 of those materials for use in production. Prepare journal entries to record its (1) purchase of raw

> Zilly Co. predicts sales of $400,000 for June. Zilly pays a sales manager a monthly salary of $6,000 and a commission of 8% of sales dollars. Prepare a selling expense budget for the month of June.

> Music World reports the following sales forecast: August, $150,000; September, $170,000. Cash sales are normally 40% of total sales and all credit sales are expected to be collected in the month following the date of sale. Prepare a schedule of cash rece

> The Guitar Shoppe reports the following sales forecast: August, $150,000; September, $170,000. Cash sales are normally 40% of total sales, 55% of credit sales are collected in the month following sale, and the remaining 5% of credit sales are written off

> Based on predicted production of 24,000 units, a company anticipates $300,000 of fixed costs and $246,000 of variable costs. If the company actually produces 20,000 units, what are the flexible budget amounts of fixed and variable costs?

> Corme Company expects sales of $34 million (400,000 units). The company’s total fixed costs are $17.5 million and its variable costs are $35 per unit. Prepare a CVP chart from this information.