Accounting hw PENDING

Marketing salaries

$

52,100   

  Property taxes, factory

12,

400

  Administrative travel

100,800   

  Sales commissions

52,800   

  Indirect labor

38,400   

  Direct materials

173,900   

  Advertising

139,900   

  Depreciation of production equipment

39,100   

  Direct labor

87,400   

a.

What is the total amount of product cost listed above? (Omit the “$” sign in your respons

e.

)

  Total product cost

$  

b.

What is the total amount of period cost listed above? (Omit the “$” sign in your response.)

  Total period cost

2) Whitman Corporation, a merchandising company, reported sales of 10,

60

0 units for May at a selling price of $7

50

per unit. The cost of goods sold (all variable) was $492 per unit and the variable selling expense was $55 per unit. The total fixed selling expense was $162,400. The variable administrative expense was $33 per unit and the total fixed administrative expense was $375,400.

Required:

a.

Prepare a contribution format income statement for May. (Input all amounts as positive values. Omit the “$” sign in your response.)

Whitman Corporation
Income Statement

  Variable expenses

:

  Fixed expenses:

b.

Prepare a traditional format income statement for May. (Input all amounts as positive values. Omit the “$” sign in your response.)

  Operating expenses:

3) In October, Patnode In

c.

, a merchandising company, had sales of $373,000, selling expenses of $34,800, and administrative expenses of $42,400. The cost of merchandise purchased during the month was $268,600. The beginning balance in the merchandise inventory account was $38,700 and the ending balance was $39,400.

Prepare a traditional format income statement for October. (Input all amounts as positive values. Omit the “$” sign in your response.)

Patnode Inc.,
Income Statement

4) Alam Company is a manufacturing firm that uses job-order costin

g.

At the beginning of the year, the company’s inventory balances were as follows:

  Raw materials

24,

30

0  

  Work in process

73,300  

  Finished goods

27,300  

The company applies overhead to jobs using a predetermined overhead rate based on machine-hours. At the beginning of the year, the company estimated that it would work 45,300 machine-hours and incur $181,200 in manufacturing overhead cost. The following transactions were recorded for the year:

Raw materials were purchased, $416,300.

Raw materials were requisitioned for use in production, $423,000 ($380,300 direct and $42,700 indirect).

c.

The following employee costs were incurred: direct labor, $414,300; indirect labor, $60,300; and administrative salaries, $212,300.

d.

Selling costs, $141,300.

Factory utility costs, $20,300.

f.

Depreciation for the year was $81,600 of which $73,300 is related to factory operations and $8,300 is related to selling, general, and administrative activities.

Manufacturing overhead was applied to jobs. The actual level of activity for the year was 48,300 machine-hours.

h.

The cost of goods manufactured for the year was $1,004,300.

i.

Sales for the year totaled $1,416,300 and the costs on the job cost sheets of the goods that were sold totaled $989,300.

j.

The balance in the Manufacturing Overhead account was closed out to Cost of Goods Sold.

Prepare the appropriate journal entry for each of the items above (a. through j.). You can assume that all transactions with employees, customers, and suppliers were conducted in cash. (Round your answers to the nearest dollar amount. Omit the “$” sign in your response.)

General Journal

Debit

Credit

5) Nygaard Corporation uses the weighted-average method in its process costing. The following data pertain to its Assembly Department for September.

Percent Complete

Units

Materials

Conversion

  Work in process, September 1

650    

65

%

30%       

  Units started into production during September

8,800    

  Units completed during September and     transferred to the next department

7,800    

  Work in process, September 30

1,650    

70%     

50%       

Compute the equivalent units of production for both materials and conversion costs for the Assembly Department for September using the weighted-average method.

  Equivalent units of production

6) Dana Inc. uses the FIFO method in its process costing system. The following data concern the operations of the company’s first processing department for a recent month.

  Work in process beginning:

  Units in process

  Percent complete with respect to materials

  Percent complete with respect to conversion

  Costs in the beginning inventory:

  Materials

cost

$505

  Conversion

cost

$2,093

  Units started into production during the month

11,000

  Units completed and transferred out

  Costs added to production during the month:

$17,664

$279,112

  Work in process,ending:

Using the FIFO method:

Determine the equivalent units of production for materials and conversion costs.

Equivalent Units
of Production

Determine the cost per equivalent unit for materials and conversion costs. (Do not round intermediate calculations and final answers to 2 decimal places.)

Cost per
Equivalent Unit

$   

Determine the cost of ending work in process inventory. (Do not round intermediate calculations. Omit the “$” sign in your response.)

  Cost of ending WIP

Determine the cost of units transferred out of the department during the month. (Do not round intermediate calculations. Omit the “$” sign in your response.)

  Cost of units transferred out

7) Data concerning Tietz Corporation’s single product appear below:

Per Unit

Percent of Sales

  Selling price

160  

100%

40  

  25%

  Contribution margin

120  

  75%

Fixed expenses are $1,036,000 per month. The company is currently selling 9,500 units per month.

The marketing manager would like to introduce sales commissions as an incentive for the sales staff. The marketing manager has proposed a commission of $10 per unit. In exchange, the sales staff would accept an overall decrease in their salaries of $110,000 per month. The marketing manager predicts that introducing this sales incentive would increase monthly sales by 520 units.

What should be the overall effect on the company’s monthly net operating income of this change? (Negative amount should be indicated by a minus sign. Omit the “$” sign in your response.)

  Change in net operating income

8) Colen Corporation produces and sells a single product. In January, the company sold 1,600 units. Its total sales were $162,000, its total variable expenses were $80,800, and its total fixed expenses were $57,700.

Compute the company’s Net operating income for January. (Do not round intermediate calculations. Omit the “$” sign in your response.)

  Net operating income

Compute the company’s Net operating income assuming that the company sells 1,500 units. (Do not round intermediate calculations. Omit the “$” sign in your response.)