Devry ACCT346 Week 4-7 Assignment 27468

Question

DeVry University

ACCT346 Weekly Assignment

Week 4

Directions: Your assignment this week is to answer the question below which has four parts. Please show your work for full credit and use the boxes provided. Please add more rows or columns to the box if needed.

1. MountainAir Company has the following selected data for the past year:

Units sold during year

30,000

Units produced during year

45,000

Units in ending inventory

15,000

Variable manufacturing cost per unit

$4.50

Fixed manufacturing overhead (in total)

$20,250

Selling price per unit

$12.00

Variable selling and administrative expense per unit

$1.00

Fixed selling and administrative expenses (in total)

$4,000

There were no units in beginning inventory.

Required:

1a. Prepare an income statement for last year using absorption costing.

1b. Calculate the value of the ending inventory using absorption costing.

1c. Prepare an income statement for last year using variable costing.

1d. Calculate the value of the ending inventory using variable costing.

DeVry University
ACCT346 Weekly Assignment
Week 5

Directions: Your assignment this week is to answer the below three questions. Please note that question #1 has 2 parts, part a and part b and question #2 has 3 parts, part a, part b and part c. Please show your work for full credit and use the box provided. Please add more rows or columns to the box if needed.

1. Palmer's Gourmet Chocolates produces and sells assorted boxed chocolates. The unit selling price is $50, unit variable costs are $25, and total fixed costs are $2,000. 1a. How many boxes of chocolates must Palmer's Gourmet Chocolates sell to breakeven? 1b. What are breakeven sales in dollars? 2. Extreme Sports received a special order for 1,000 units of its extreme motorbike at a selling price of $250 per motorbike. Extreme Sports has enough extra capacity to accept the order. No additional selling costs will be incurred. Unit costs to make and sell this product are as follows: Direct materials, $100; direct labor, $50; variable manufacturing overhead, $14; fixed manufacturing overhead, $10, and variable selling costs, $2. 2a. List the relevant costs. 2b. What will be the change in operating income if Extreme Sports accepts the special order? 2c. Should Extreme Sports accept the special order? Why or why not? 3. Totally Technology manufactures Cameras and Video Recorders. The company's product line income statement follows:

	Camera	Video Recorder	Total
Sales revenue	$3,00,000	$1,00,000	$4,00,000
Cost of goods sold
Variable	$75,000	$49,000	$1,24,000
Fixed	$82,000	$28,000	$1,10,000
Total cost of goods sold	$1,57,000	$77,000	$2,34,000
Gross profit	$1,43,000	$23,000	$1,66,000
Marketing and administrative expenses
Variable	$25,000	$28,000	$53,000
Fixed	$32,000	$19,000	$51,000
Total marketing and administrative expenses	$57,000	$47,000	$1,04,000
Operating income (loss)	$86,000	(24,000)	$62,000

Management is considering discontinuing the Video Recorder product line. Accountants for the company estimate that discontinuing the Video Recorder line will decrease fixed cost of goods sold by $10,000 and fixed marketing and administrative expenses by $4,000.

*Prepare an analysis supporting your opinion about whether or not the Video Recorder product line should be discontinued.*

DeVry University
ACCT346 Weekly Assignment
Week 5

Directions: Your assignment this week is to answer the below three questions. Please note that question #1 has 2 parts, part a and part b and question #2 has 3 parts, part a, part b and part c. Please show your work for full credit and use the box provided. Please add more rows or columns to the box if needed.

1. Palmer's Gourmet Chocolates produces and sells assorted boxed chocolates. The unit selling price is $50, unit variable costs are $25, and total fixed costs are $2,000. 1a. How many boxes of chocolates must Palmer's Gourmet Chocolates sell to breakeven? 1b. What are breakeven sales in dollars? 2. Extreme Sports received a special order for 1,000 units of its extreme motorbike at a selling price of $250 per motorbike. Extreme Sports has enough extra capacity to accept the order. No additional selling costs will be incurred. Unit costs to make and sell this product are as follows: Direct materials, $100; direct labor, $50; variable manufacturing overhead, $14; fixed manufacturing overhead, $10, and variable selling costs, $2. 2a. List the relevant costs. 2b. What will be the change in operating income if Extreme Sports accepts the special order? 2c. Should Extreme Sports accept the special order? Why or why not? 3. Totally Technology manufactures Cameras and Video Recorders. The company's product line income statement follows:

	Camera	Video Recorder	Total
Sales revenue	$3,00,000	$1,00,000	$4,00,000
Cost of goods sold
Variable	$75,000	$49,000	$1,24,000
Fixed	$82,000	$28,000	$1,10,000
Total cost of goods sold	$1,57,000	$77,000	$2,34,000
Gross profit	$1,43,000	$23,000	$1,66,000
Marketing and administrative expenses
Variable	$25,000	$28,000	$53,000
Fixed	$32,000	$19,000	$51,000
Total marketing and administrative expenses	$57,000	$47,000	$1,04,000
Operating income (loss)	$86,000	(24,000)	$62,000

Management is considering discontinuing the Video Recorder product line. Accountants for the company estimate that discontinuing the Video Recorder line will decrease fixed cost of goods sold by $10,000 and fixed marketing and administrative expenses by $4,000.

*Prepare an analysis supporting your opinion about whether or not the Video Recorder product line should be discontinued.*

DeVry University

ACCT346 Weekly Assignment

Week 6

Directions: Your assignment this week is to answer the two questions below. Please note that Question #2 has 2 parts, Part A and Part B. Please show your work for full credit and use the box provided. Please add more rows or columns to the box if needed.

1. Cave Hardware's forecasted sales for April, May, June, and July are $200,000, $230,000, $190,000, and $240,000, respectively. Sales are 65% cash and 35% credit with all accounts receivables collected in the month following the sale. Cost of goods sold is 75% of sales and ending inventory is maintained at $60,000 plus 10% of the following month's cost of goods sold. All inventory purchases are paid 22% in the month of purchase and 78% in the following month.

What are the cash collections budgeted for June?

2. Madden Corporation manufactures t-shirts, which is its only product. The standards for t-shirts are as follows:

Standard direct labor cost per hour $17

Standard direct labor hours per t-shirt 0.6

During the month of January, the company produced 1,250 t-shirts. Related production data for the month is as follows:

Actual direct labor hours 770

Actual direct labor cost incurred $13,000

2a. What is the direct labor rate variance for the month? Is it favorable or unfavorable?

2b. What is the direct labor efficiency variance for the month? Is it favorable or unfavorable?

DeVry University
ACCT346 Weekly Assignment
Week 7

Directions: Your assignment this week is to answer the four questions below. Please note that Question #1 has 2 parts, Part A and Part B. Please show your work for full credit and use the box provided. Please add more rows or columns to the box if needed.

1. Gomez Corporation is considering two alternative investment proposals with the following data:

	Proposal X	Proposal Y
Investment	$8,50,000	$4,68,000
Useful life	8 years	8 years
Estimated annual net	$1,25,000	$78,000
cash inflows for 8 years
Residual value	$40,000	$ -
Depreciation method	Straight-line	Straight-line
Required rate of return	14%	10%

1a. How long is the payback period for Proposal X?

1b. What is the accounting rate of return for Proposal Y?

2. You have been awarded a scholarship that will pay you $500 per semester at the end of each of the next 8 semesters that you earn a GPA of 3.5 or better. You are a very serious student and you anticipate receiving the scholarship every semester. Using a discount rate of 3% per semester, which of the following is the correct calculation for determining the present value of the scholarship? PLEASE STATE WHY YOU CHOSE THE ANSWER THAT YOU DID.

A) PV = $500 × 3% × 8

B) PV = $500 × (Annuity PV factor, i = 3%, n = 8)

C) PV = $500 × (Annuity FV factor, i = 6%, n = 4)

D) PV = $1,000 × (PV factor, i = 3%, n = 4)

3. Maersk Metal Stamping is analyzing a special investment project. The project will require the purchase of two machines for $30,000 and $8,000 (both machines are required). The total residual value at the end of the project is $1,500. The project will generate cash inflows of $11,000 per year over its 8-year life.

If Maersk requires a 6% return, what is the net present value (NPV) of this project? (Use present value tables or Excel.)

4. Hincapie Manufacturing is evaluating investing in a new metal stamping machine costing $30,924. Hincapie estimates that it will realize $12,000 in annual cash inflows for each year of the machine's 3-year useful life.

Approximately, what is the the internal rate of return (IRR) for the machine? (Use present value tables or Excel.)

11 years ago

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