Question: Refer to the information for Ambient Inc.

> Suppose you purchase a Treasury bond futures contract at a price of 95 percent of the face value, $100,000. a. What is your obligation when you purchase this futures contract? b. Assume that the Treasury bond futures price falls to 94 percent. What is yo

> Consider the following two financial institutions: Managers of the money center bank are concerned that interest rates may fall over the next four years, while managers of the savings bank are concerned that interest rates may rise over the next four y

> A commercial bank has $200 million of floating-rate loans yielding the T-bill rate plus 2 percent. These loans are financed with $200 million of fixed-rate deposits costing 9 percent. A savings bank has $200 million of mortgages with a fixed rate of 13 p

> An insurance company owns $50 million of floating-rate bonds yielding LIBOR plus 1 percent. These loans are financed with $50 million of fixed-rate guaranteed investment contracts (GICs) costing 10 percent. A finance company has $50 million of auto loans

> An FI has purchased a $200 million cap of 9 percent at a premium of 0.65 percent of face value. A $200 million floor of 4 percent is also available at a premium of 0.69 percent of face value. a. If interest rates rise to 10 percent, what is the amount r

> Calculate the yield to maturity on the following bonds: a. A 9 percent coupon (paid semiannually) bond, with a $1,000 face value and 15 years remaining to maturity. The bond is selling at $985. b. An 8 percent coupon (paid quarterly) bond, with a $1,000

> A particular security’s equilibrium rate of return is 8 percent. For all securities, the inflation risk premium is 1.75 percent and the real risk-free rate is 3.5 percent. The security’s liquidity risk premium is 0.25 percent and maturity risk premium is

> A factory manufactures jelly. The jars of jelly are packed six to a box, and the boxes are sold to grocery stores. The following types of cost were incurred: Required: Classify each of the costs as direct materials, direct labor, or overhead by using t

> Loring Company incurred the following costs last year: Required: 1. Classify each of the costs using the following table format. Be sure to total the amounts in each column. Example: Direct materials, $216,000. 2. What was the total product cost for

> Tidwell Company experienced the following during 20X1: a. Sold preferred stock for $480,000. b. Declared dividends of $150,000 payable on March 1, 20X2. c. Borrowed $575,000 from a bank on a 2-year note. d. Purchased $80,000 of its own common stock to ho

> Brunello Winery produces expensive wines. Brunello’s enterprise risk management team has chosen its particular risk response to each of its top five inherent risks. The risk graph below shows Brunello’s risks after all

> Blaylock Company wants to buy a numerically controlled (NC) machine to be used in producing specially machined parts for manufacturers of tractors. The outlay required is $384,000. The NC equipment will last 5 years with no expected salvage value. The ex

> Spiro Hospital is investigating the possibility of investing in new dialysis equipment. Two local manufacturers of this equipment are being considered as sources of the equipment. After-tax cash inflows for the two competing projects are as follows: Bo

> Barolo Company manufactures laptop stickers for Italian sports teams. Barolo’s risk management team has identified the company’s top five inherent risks and plans to manage them using a typical ERM portfolio perspectiv

> The Avila Division of Maldonado Company had operating income last year of $136,400 and average operating assets of $1,900,000. Maldonado’s minimum acceptable rate of return is 9%. (Note: Round all answers to two decimal places.) Required: 1. Calculate t

> Data follow for the Consumer Products Division of Kisler Inc.: Required: 1. Compute the margin and turnover ratios for each year. 2. Compute the ROI for the Consumer Products Division for each year. Year 1 Year 2 Sales $ 92,100,000 $ 98,750,000 Ope

> Pelak Company had sales of $25,000,000, expenses of $17,500,000, and average operating assets of $10,000,000. Required: Compute the (1) operating income, (2) margin and turnover ratios, and (3) ROI.

> Refer to the information for Slap shot Company on the previous page. Required: Prepare an income statement for Slap shot for the month of June. Data for Question 24: Slap shot Company makes ice hockey sticks and sold 1,880 sticks during the month of J

> Healing Hands Massage Hut offers high-end, specialized massages and grooming services, including manicures, pedicures, facials, and full-body massages. Healing Hands is a new startup service organization that generates monthly sales of $200,000. As a sta

> Refer to the information for Morning Smiles Coffee Company on the previous page. Required: Prepare an income statement for Morning Smiles for the month of March and calculate the percentage of sales revenue represented by each line of the income stateme

> Refer to the information for Morning Smiles Coffee Company on the previous page. Required: Prepare an income statement for Morning Smiles for the month of March. Data for Question 32: Morning Smiles Coffee Company manufactures Stoneware French Press c

> Morning Smiles Coffee Company manufactures Stoneware French Press coffee makers. During the month of March, 8,100 coffee makers were completed at a cost of goods manufactured of $607,500. Suppose that on March 1, Morning Smiles had 1,000 units in finishe

> Morning Smiles Coffee Company manufactures Stoneware French Press coffee makers. During the month of March, the company purchased $350,000 of materials. Also during the month of March, Morning Smiles incurred direct labor cost of $74,000 and manufacturin

> Morning Smiles Coffee Company manufactures Stoneware French Press coffee makers. On March 1, Morning Smiles had $25,000 of materials in inventory. During the month of March, the company purchased $350,000 of materials. On March 31, materials inventory eq

> Refer to the information for Morning Smiles Coffee Company on the previous page. Required: 1. Calculate the total prime cost for last week. 2. Calculate the per-unit prime cost. 3. Calculate the total conversion cost for last week. 4. Calculate the per-

> Refer to the information for Morning Smiles Coffee Company above. Required: 1. Calculate the total product cost for last week. 2. Calculate the per-unit cost of one coffee maker that was produced last week. Data for Question 27: Morning Smiles Coffee

> Cardenas Pharmaceutical produces antibiotics. During April, Cardenas’s tableting department had the following data: Units in BWIP……………………………………… — Units completed …………………………..105,000 Units in EWIP (30% complete) ………15,750 Required: Calculate April’s ou

> Hardy Company produces 18-ounce boxes of a rolled oat cereal in three departments: mixing, cooking, and packaging. During September, Hardy produced 200,000 boxes with the following costs: Required: 1. Calculate the costs transferred out of each departm

> During April, the grinding department of Tranx Inc. completed and transferred out 315,000 units. At the end of April, there were 112,500 units in process, 60% complete. Tranx incurred manufacturing costs totaling $2,295,000. Required: 1. Calculate the u

> Refer to the information for Saludable Inc. above. Required: 1. Calculate the equivalent units for November. 2. Calculate the unit cost. (Note: Round to two decimal places.) 3. Assign costs to units transferred out and EWIP using the FIFO method. Data

> Refer to the information for Saludable Inc. above. Required: 1. Calculate the equivalent units for November. 2. Calculate the unit cost. (Note: Round to two decimal places.) 3. Assign costs to units transferred out and EWIP using the FIFO method. Data

> Craig Company produces electronic components for cell phone producers. The receiving department at Craig has eight clerks who process incoming goods. The total cost of their salaries is $440,000. The work distribution for the activities that they perform

> Refer to the information above for Cinturas Company. The following activity data have been collected: Cutting ………………â€&brv

> Tara Company takes 8,000 hours to produce 40,000 units of a product. Required: What is the velocity? Cycle time?

> Evans Inc. has the following two activities: (1) Reworking products, cost: $740,000. The reworking cost of the most efficient similar-sized competitor is $200,000. (2) Purchasing parts, cost: $900,000 (45,000 purchasing hours). A benchmarking study revea

> Refer to the information in Brief Exercise 4-31 for data. Now, assume that Jonson has decided to use a plant wide overhead rate based on direct labor hours. Required: 1. Calculate the predetermined plant wide overhead rate. (Note: Round to the nearest c

> Refer to the data for Beyta Company above. Required: 1. Calculate the cost of goods sold under variable costing. 2. Prepare an income statement using variable costing. Data for Exercise 33: During the most recent year, Beyta Company had the following

> Refer to the data for Beyta Company above. Required: 1. Calculate the cost of goods sold under absorption costing. 2. Prepare an income statement using absorption costing. Data for Exercise 32: During the most recent year, Beyta Company had the follow

> Refer to the data for Pelham Company on the previous page. Required: 1. How many units are in ending inventory? 2. Using variable costing, calculate the per-unit product cost. 3. What is the value of ending inventory under variable costing? Data for Ex

> Refer to the information for Zapato Company given above. The following activity data have been collected: Cutting ………………â€

> At the end of the year, Estes Company provided the following actual information: Overhead …………………………………$412,600 Direct labor cost …………………………532,000 Estes uses normal costing and applies overhead at the rate of 75% of direct labor cost. At the end of th

> At the beginning of the year, Estes Company estimated the following costs: Overhead ……………………………………..$450,000 Direct labor cost ……………………………..600,000 Estes uses normal costing and applies overhead on the basis of direct labor cost. (Direct labor cost i

> Chillmax Company plans to sell 3,500 pairs of shoes at $60 each in the coming year. Unit variable cost is $21 (includes direct materials, direct labor, variable factory overhead, and variable selling expense). Total fixed cost equals $78,000 (includes fi

> Refer to the information for Speedy Pete’s above. Assume that this information was used to construct the following formula for monthly delivery cost. Total Delivery Cost = $41,850 + ($12.00 × Number of Deliveries) Required

> Chillmax Company plans to sell 3,500 pairs of shoes at $60 each in the coming year. Unit variable cost is $21 (includes direct materials, direct labor, variable factory overhead, and variable selling expense). Fixed factory overhead is $30,000 and fixed

> Chillmax Company plans to sell 3,500 pairs of casual shoes at $60 each in the coming year. Product costs include: Direct materials per pair …………………………………..$12 Direct labor per pair ……………………………………………4 Variable factory overhead per pair ……………………….2 Total

> Corey Company provided the following information: Standard fixed overhead rate (SFOR) per direct labor hour …….$10.00 Actual fixed overhead ………………………………………………………...$425,000 Budgeted fixed overhead …………………………………………………..$500,000 Actual production in units

> Bulger Company provided the following data: Standard fixed overhead rate (SFOR) ……..$8 per direct labor hour Actual fixed overhead costs ………………………………………….$985,300 Standard hours allowed per unit ………………………………………6 hours Actual production …………………………………………

> Potter Company provided the following information: Required: Prepare a performance report that shows the variances for each variable overhead item (inspection and power). Standard variable overhead rate (SVOR) per direct labor hour $5.00 Actual v

> Patrick Inc. sells industrial solvents in 5-gallon drums. Patrick expects the following units to be sold in the first 3 months of the coming year: January ………………………….41,000 February …………………………38,000 March ……………………………..50,000 The average price for a dru

> Refer to the information for Ambient Inc. above. Required: Calculate the total variance for production labor for the month of May. Data for Problem 36: Ambient Inc. produces aluminum cans. Each can has a standard labor requirement of 0.03 hour. During

> Refer to the information for Young Inc. above. Required: Calculate the materials price and usage variances using the columnar and formula approaches. Data for Exercise 35: Young Inc. produces plastic bottles. Production of 16-ounce bottles has a stand

> Refer to the information for Young Inc. above. Required: Calculate the total variance for plastic for the month of June Data for Exercise 34: Young Inc. produces plastic bottles. Production of 16-ounce bottles has a standard unit quantity of 0.45 ounc

> During the last 6 weeks, the actual costs of labor for Solsana Company were as follows: The standard materials cost for each week was $40,000 with an allowable deviation of ±5,000. Required: Plot the actual costs over time against the

> Dulce Company produces chocolate. Each pound of chocolate requires 400 cocoa beans (the unit quantity standard) and 0.15 labor hour (the unit labor standard). During the year, 480,000 pounds of chocolate were produced. Required: 1. Calculate the number

> Balboa Company budgeted production of 4,500 units with the following amounts: At the end of the year, Balboa had the following actual costs for production of 4,700 units: Required: 1. Calculate the budgeted amounts for each cost category listed ab

> Balboa Company budgeted the following amounts: Required: Prepare a flexible budget for 4,000 units, 4,500 units, and 5,000 units. Variable costs of production: Direct materials 3 pounds @ $1.30 per pound 0.5 hr. @ $18.00 per hour 0.5 hr. @ $3.40

> Oliver’s Bistro provided the following information for the month of October: a. Sales are budgeted to be $395,000. About 80% of sales is cash; the remainder is on account. b. Oliver’s Bistro expects that, on average, 70% of credit sales will be paid in t

> Pilsner Inc. purchases raw materials on account for use in production. The direct materials purchases budget shows the following expected purchases on account: April …………………………..$374,400 May ……………………………….411,200 June …………………………….416,000 Pilsner typica

> Weiland and Company is a medical billing services firm. All sales of billing services are billed to the client (there are no cash sales). Weiland expects that, on average, 15% will be paid in the month of billing, 40% will be paid in the month following

> During the year, Swasey Company sold equipment with a book value of $560,000 for $760,000 (original purchase cost of $960,000). New equipment was purchased. Swasey provided the following comparative balance sheets: Required: Calculate the investing cas

> Jameson Company provided the following information for the coming year: Units produced and sold …………………………………………………………..230,000 Cost of goods sold per unit …………………………………………………………….$5.30 Selling price …………………………………………………………………………………$9.70 Variable sellin

> Elwood Company makes and sells plastic trash bags. In the coming year, Elwood expects total sales of $18,620,000. There is a 4% commission on sales. In addition, fixed expenses of the sales and administrative offices include the following: Salaries…………

> Lazlo Company manufactures a line of table lamps. Each lamp takes $5.00 of direct materials and uses 0.9 direct labor hour at $18.00 per direct labor hour. The variable overhead rate is $1.00 per direct labor hour and the fixed overhead rate is $2.00 per

> Lazlo Company manufactures a line of table lamps. Each lamp takes $5 of direct materials and uses 0.9 direct labor hour at $18 per direct labor hour. The variable overhead rate is $1.00 per direct labor hour, and the fixed overhead rate is $2.00 per dire

> Tulum Inc. makes a Mexican chocolate mix. Budgeted direct labor hours for the first 3 months of the coming year are: January ……………………………….9,880 February ……………………………..8,800 March ………………………………….12,200 The variable overhead rate is $0.50 per direct labo

> Tulum Inc. makes a Mexican chocolate mix. Planned production in units for the first 3 months of the coming year is: January ………………………….24,700 February ………………………..22,000 March ……………………………30,200 Each box of chocolate mix takes 0.4 direct labor hour. The

> Tulum Inc. makes a Mexican chocolate mix. In the first 4 months of the coming year, Tulum expects the following unit sales: January …………………………22,000 February ……………………….20,000 March ……………………………30,000 April ……………………………….31,000 Tulum’s policy is to have 2

> Tulum Inc. sells powdered Mexican chocolate to restaurants. Its basic unit is a 4-pound box of the spiced chocolate mixture. Tulum expects the following units to be sold in the first 3 months of the coming year: January …………………………..22,000 February ……………

> Sisters, Inc. manufactures professional-level printers that perform multiple features, such as high-resolution color scanning, printing, faxing, and copying. The new printer model has a target price of $600. Management requires a 20% profit on new produc

> Enviro Consulting Firm provides various environmental consulting services to organizations. Enviro has decided to price its jobs at the total direct variable costs of the job plus 10%. The job for a new client included the following costs: Direct materi

> Refer to the information for Barnard Manufacturing on the previous page. Round answers to two decimal places. Required: Calculate (1) average operating assets, (2) margin, (3) turnover, and (4) return on investment. Data for Exercise 19: Barnard Manuf

> Kraft Bowlen owns two sports franchises—the Bladers (a hockey team) and the Ballers (a basketball team). The following information was provided for the coming year. A sales commission of 5% of sales revenue is paid for each of the two

> Chillmax Company had planned to sell 3,500 pairs of shoes at $60 each in the coming year. Unit variable cost is $21 (includes direct materials, direct labor, variable factory overhead, and variable selling expense). Total fixed cost equals $78,000 (inclu

> Chillmax Company plans to sell 3,500 pairs of shoes at $60 each in the coming year. Unit variable cost is $21 (includes direct materials, direct labor, variable factory overhead, and variable selling expense). Total fixed cost equals $78,000 (includes fi

> Chillmax Company plans to sell 3,500 pairs of shoes at $60 each in the coming year. Unit variable cost is $21 (includes direct materials, direct labor, variable factory overhead, and variable selling expense). Total fixed cost equals $78,000 (includes fi

> Chillmax Company now sells both pairs of shoes and carryalls. Next year, Chillmax expects to produce total revenue of $210,000 and incur total variable cost of $81,375. Total fixed cost is expected to be $91,500. Required: 1. Calculate the break-even po

> Chillmax Company plans to sell 3,500 pairs of shoes at $60 each in the coming year. Variable cost is 35% of the sales price; contribution margin is 65% of the sales price. Total fixed cost equals $78,000 (includes fixed factory overhead and fixed selling

> Vigor Inc. produces an energy drink. The product is sold by the quart. The company has two departments: mixing and bottling. For May, the bottling department had 30,000 quarts in beginning inventory (with transferred-in costs of $63,000) and completed 14

> Ming Inc. had the following production and cost information for its blending department during February (with materials added at the beginning of the process): Ming uses the weighted average method. Required: 1. Prepare an equivalent units schedule. 2

> Washburn Inc. manufactures precision tools in two departments: molding and finishing. Washburn uses the weighted average method. Manufacturing costs are added uniformly throughout the process. The following are cost and production data for the molding de

> Craig Inc. just finished its third month of operations. Craig mass-produces carburetors used in motorcycle engines. The following production information is provided for December: Units in process, December 1, 60% complete …………….60,000 Units completed an

> Gorman Nurseries Inc. grows poinsettias and fruit trees in a green house/nursery operation. The following information was provided for the coming year. A sales commission of 4% of sales is paid for each of the two product lines. Direct fixed selling an

> Polson Enterprises produces strawberry gelato. Output is measured in quarts. Polson uses the weighted average method. During July, Polson had the following production data: Units in process, July 1, 60% complete………………….54,000 quarts Units completed and

> During August, the drilling department of Arenal Inc. completed and transferred out 190,000 units. At the end of August, there were 42,700 units in process, 70% complete. Arenal incurred manufacturing costs totaling $1,759,120. Required: 1. Calculate th

> Branch Company provided the following information: Standard fixed overhead rate (SFOR) per direct labor hour ……..$5.00 Actual fixed overhead ……………………………………………………….$305,000 BFO………………………………………………………………………………….$300,000 Actual production in units ………………………

> Rath Company showed the following information for the year: Standard variable overhead rate (SVOR) per direct labor hour …….$3.75 Standard hours (SH) allowed per unit ………………………………………………..4 Actual production in units ………………………………………………………….15,000 Actual

> Refer to the information for Tico Inc. on the previous page. Required: Calculate the total variance for production labor for the month of April. Data for Exercise 25: Tico Inc. produces plastic bottles. Each bottle has a standard labor requirement of

> Refer to the information for Krumple Inc. above. Required: Calculate the materials price and usage variances using the columnar and formula approaches. Data for Exercise 24: Krumple Inc. produces aluminum cans. Production of 12-ounce cans has a standa

> Refer to the information for Krumple Inc. above. Required: Calculate the total variance for aluminum for the month of April. Data for Exercise 23: Krumple Inc. produces aluminum cans. Production of 12-ounce cans has a standard unit quantity of 4.7 oun

> During the last 6 weeks, the actual costs of materials for Brennen Company were as follows: The standard materials cost for each week was $60,000 with an allowable deviation of ±6,000. Required: Plot the actual costs over time against th

> Miel Company produces ready-to-cook oatmeal. Each carton of oatmeal requires 16 ounces of rolled oats per carton (the unit quantity standard) and 0.04 labor hour (the unit labor standard). During the year, 960,000 cartons of oatmeal were produced. Requi

> Powers Inc. produces a protein drink. The product is sold by the gallon. The company has two departments: mixing and bottling. For August, the bottling department had 70,000 gallons in beginning inventory (with transferred-in costs of $283,000) and compl

> During the last 2 years of operations, Haws Company had the following transactions: a. Reported a loss for the year ($800,000). b. Reported profits of $6,000,000 for the most recent year. c. Issued bonds with a 6-year maturity date for $2,000,000. d. Ret

> Carter Inc. had the following production and cost information for its fabrication department during April (with materials added at the beginning of the fabrication process): Carter uses the weighted average method. Required: 1. Prepare an equivalent u

> Golding Inc. just finished its second month of operations. Golding mass-produces integrated circuits. The following production information is provided for December: Units in process, December 1, 80% complete ……………….160,000 Units completed and transferre

> Applegate Enterprises produces premier raspberry jam. Output is measured in pints. Applegate uses the weighted average method. During January, Applegate had the following production data: Units in process, January 1, 60% complete ……………108,000 pints Unit

> Klynveld Company’s balance sheet shows total liabilities of $94,000,000, total stockholders’ equity of $75,000,000, and total assets of $169,000,000. Required: Note: Round answers to two decimal places. 1. Calculate the debt ratio. 2. Calculate the debt

> Alessandra Makeup Manufacturers provided the following income statement for last year: Sales ………………………………………………..$51,350,000 Cost of goods sold ……………………………….19,250,000 Gross margin …………………………………….$32,100,000 Operating expenses ………………………………6,200,000 Oper

> Refer to the information for Toby’s on the previous page. Required: Note: Round answers to one decimal place. 1. Calculate the average accounts receivable. 2. Calculate the accounts receivable turnover ratio. 3. Calculate the accounts