Accounting -V

Running Head: ACCOUNTING 1

QUESTIONS 2

Title: QUESTIONS

Student’s Name:

Institution:

Chapter 2

Exercise 2-28

1. The tire costs incurred by Ford Motor Company

Variable, Product cost, direct material

2. The sales commissions paid to the sales force of Dell Inc.

Variable, Period cost

3. Wood glue consumed in the manufacture of Thomasville furniture

Variable, Direct material, Product cost

4. Hourly wages of refinery security guards employed by ExxonMobil Corporation

Manufacturing overhead, Product cost, variable

5. The salary of a financial vice president of Hewlett Packard

Period cost, Fixed

6. Advertising costs of Coca-Cola

Fixed, Period costs

7. Straight line depreciation on factory machinery of Boeing Corporation.

Manufacturing overhead, fixed, Product cost

8. Wages of assembly line personnel of Whirlpool Corporation

Variable, direct labor, Product cost

9. Delivery costs incurred by Ben & Jerry’s for a shipment of their ice cream to a grocery store

Variable, Period cost

10. Newsprint consumed in printing The New York Times

variable, Product cost, direct material

11. Plant insurance costs in Texas instruments

Fixed, Product cost, manufacturing overhead

12. LED costs incurred in light bulb manufacturing of GE Lighting.

Product cost, direct material, variable

Problem 2-37

1. Salaries of players on the Boston Red Sox. Cost of Goods Manufactured

2. Year-end completed goods of Levi Strauss jeans. Balance Sheet

3. Executive compensation costs at Home Depot: Balance Sheet and Income Statement

4. Advertising costs for Sony. Income Statement

5. Costs incurred during the period to insure a Ford plant against fire and flood losses. Income Statement

6. Current year's depreciation on a Carnival Cruise Line ship. Income Statement and Balance Sheet

7. The cost of printer ink and paper used during the period by Shutterfly. Balance Sheet

8. Assembly-line wage cost incurred at a Kona bicycle plant. Income Statement

9. Year-end production in process at Lenovo Computer manufacturers. Cost of Goods Manufactured

10. The cost of products sold to customers of a Target store. Cost of products sold

11. The cost of products sold to distributors of carpet manufacturer Shaw Floors. Income statement

1. What major assets will normally be insignificant for service enterprises and relatively substantial for retailers, wholesalers and manufacturers? Briefly discuss.

The assets which are normally insignificant for service enterprises and relatively substantial for retailers, wholesalers and manufactures are the inventory.

2. Briefly explain the major differences between income statements of service enterprises versus those of retailers, wholesalers and manufacturers.

The firms used in the production processes are used in ensuring that the different goods are produced while the retailers are used to carry out purchases and merchandise inventory.

Problem 2-45

Cost items

1. Cost of fabric used in T-shirt- Direct material

2. Wages of shirt makers- Direct labor

3. Cost of new sign in front of retail T-shirt shop- Direct labor

4. Wages of the employee who repair the firm’s sewing machines- Direct labor

5. Cost of electricity used in the sewing department- Variable

6. Wages of T-shirts designers and painters- Direct labor

7. Wages of sales personnel- Direct labor

8. Depreciation on sewing machines- Selling

9. Rent on the building. Part of the building’s first floor is used to make and paint T-shirts. Part of it is used for the retail sales shop. The second floor is used for administrative offices and storage of raw material and finished goods- Period

10. Cost of daily advertisements in local media- Period cost

11. Wages of designers who experiment with new fabrics, paints and T-shirt designs- Direct labor

12. Cost of hiring a pilot to fly along the beach pulling a banner advertising the shop- Period and fixed

13. Salary of the owner’s secretary- Period and fixed

14. Cost of repairing the gas furnace- Variable

15. Cost of insurance for the production employee- manufacturing overhead.

References

Lau, M., & Elby, A. (2018). Accounting for variability in a teacher’s epistemology: Resources and framing.

Bartelmus, P., & Seifert, E. K. (Eds.). (2018). Green accounting. Routledge.

Wildavsky, A., Lockhart, C., & Coughlin, R. M. (2018). Accounting for the Environment 1. In Culture and Social Theory (pp. 85-112). Routledge.