Financial and Managerial Accounting 12th. Edition by Carl S. Warren, James M. Reeve, Jonathan Duchac | 9781133952428 | 1133952429 | Holooly

Accounting for Business

Financial and Managerial Accounting

217 SOLVED PROBLEMS

Question: 24.IP.1

Inez Company recently began production of a new product, a digital clock, which required the investment of $1,600,000 in assets. The costs of producing and selling 80,000 units of the digital clock are estimated as follows: Variable costs: Direct materials $10.00 per unit Direct labor 6.00 Factory ...

Verified Answer:

1. $160,000 ($1,600,000 × 10%) 2. a. Total manuf...

Question: 26.IP.1

Hammer Company plans to use activity-based costing to determine its product costs. It presently uses a single plantwide factory overhead rate for allocating factory overhead to products, based on direct labor hours. The total factory overhead cost is as follows: ...

Verified Answer:

1. Single Plantwide Factory Overhead Rate = [late...

Question: 25.IP.1

The capital investment committee of Hopewell Company is currently considering two investments. The estimated income from operations and net cash flows expected from each investment are as follows: ...

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1. a. Average rate of return for the truck: [l...

Question: 23.IP.1

Quinn Company has two divisions, Domestic and International. Invested assets and condensed income statement data for each division for the year ended December 31, 2014, are as follows: ...

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1. Quinn Company Divisional income Statements ...

Question: 22.IP.1

Hawley Inc. manufactures woven baskets for national distribution. The standard costs for the manufacture of Folk Art style baskets were as follows: ...

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1. Direct materials Cost variance price variance...

Question: 21.IP.1

Selected information concerning sales and production for Cabot Co. for July 2014 are summarized as follows: a. Estimated sales: Product K: 40,000 units at $30 per unit Product L: 20,000 units at $65 per unit b. Estimated inventories, July 1, 2014: Material A: 4,000 lbs. Product K: 3,000 units at ...

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Question: 19.IP.1

Wyatt Inc. expects to maintain the same inventories at the end of the year as at the beginning of the year. The estimated fixed costs for the year are $288,000, and the estimated variable costs per unit are $14. It is expected that 60,000 units will be sold at a price of $20 per unit. Maximum sales ...

Verified Answer:

1. a. Contribution Margin Ratio =

\frac...

Question: 18.IP.1

Southern Aggregate Company manufactures concrete by a series of four processes. All materials are introduced in Crushing. From Crushing, the materials pass through Sifting, Baking, and Mixing, emerging as finished concrete. All inventories are costed by the first-in, first-out method. The balances ...

Verified Answer:

1. See page 862 for the cost of production report....

Question: 27.IP.1

Krisco Company operates under the just-in-time philosophy. As such, it has a production cell for its microwave ovens. The conversion cost for 2,400 hours of production is budgeted for the year at $4,800,000. During January, 2,000 microwave ovens were started and completed. Each oven requires six ...

Verified Answer:

1. Budgeted Cell Conversion Cost Rate =

\fr...

Question: 20.IP.1

During the current period, McLaughlin Company sold 60,000 units of product at $30 per unit. At the beginning of the period, there were 10,000 units in inventory and McLaughlin Company manufactured 50,000 units during the period. The manufacturing costs and selling and administrative expenses were ...

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1. Absorption Costing Income Statement Sales...

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