Accounting wk6
Cclegg00
week_6.docExercise 1-5
Ikerd Company is a manufacturer of personal computers. Various costs and expenses associated with its operations are as follows. The company intends to classify these costs and expenses into the following categories: (a) direct materials, (b) direct labor, (c) manufacturing overhead, and (d) period costs. For each item, indicate the cost category to which it belongs.
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Item |
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Category |
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1. |
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Property taxes on the factory building. |
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2. |
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Production superintendents’ salaries. |
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3. |
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Memory boards and chips used in assembling computers. |
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4. |
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Depreciation on the factory equipment. |
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5. |
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Salaries for assembly-line quality control inspectors. |
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6. |
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Sales commissions paid to sell personal computers. |
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7. |
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Electrical components used in assembling computers. |
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8. |
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Wages of workers assembling personal computers. |
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9. |
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Soldering materials used on factory assembly lines. |
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10. |
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Salaries for the night security guards for the factory building. |
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Exercise 1-7
Kwik Delivery Service reports the following costs and expenses in June 2014.
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Indirect materials |
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$5,857 |
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Drivers’ salaries |
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$16,652 |
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Depreciation on delivery equipment |
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12,267 |
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Advertising |
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4,206 |
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Dispatcher’s salary |
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5,900 |
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Delivery equipment repairs |
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499 |
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Property taxes on office building |
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975 |
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Office supplies |
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701 |
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CEO’s salary |
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13,036 |
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Office utilities |
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1,021 |
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Gas and oil for delivery trucks |
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2,641 |
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Repairs on office equipment |
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202 |
Determine the total amount of (a) delivery service (product) costs and (b) period costs.
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Delivery service (product) costs |
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$
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Period costs |
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$
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(b)
The parts of this question must be completed in order. This part will be available when you complete the part above.
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Exercise 1-12 (Part Level Submission)Cepeda Corporation has the following cost records for June 2014. Indirect factory labor $5,500 Factory utilities $440 Direct materials used 22,280 Depreciation, factory equipment 1,690 Work in process, 6/1/14 3,560 Direct labor 41,160 Work in process, 6/30/14 4,440 Maintenance, factory equipment 1,970 Finished goods, 6/1/14 5,960 Indirect materials 2,390 Finished goods, 6/30/14 8,280 Factory manager’s salary 3,880 |
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Exercise 5-3 (Part Level Submission)The controller of Furgee Industries has collected the following monthly expense data for use in analyzing the cost behavior of maintenance costs. Month Total Maintenance Costs Total Machine Hours January $2,980 310 February 3,480 460 March 4,080 610 April 4,980 580 May 3,680 510 June 5,270 710 |
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(a)
Determine the variable cost components using the high-low method. (Round variable cost to 3 decimal places e.g. 12.250.) Variable cost per machine hour $
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Exercise 5-4
Family Furniture Corporation incurred the following costs. Identify the costs as variable, fixed, or mixed.
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1. |
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Wood used in the production of furniture. |
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2. |
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Fuel used in delivery trucks. |
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3. |
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Straight-line depreciation on factory building. |
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4. |
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Screws used in the production of furniture. |
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5. |
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Sales staff salaries. |
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6. |
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Sales commissions. |
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7. |
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Property taxes. |
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8. |
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Insurance on buildings. |
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9. |
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Hourly wages of furniture craftsmen. |
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10. |
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Salaries of factory supervisors. |
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11. |
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Utilities expense. |
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12. |
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Telephone bill. |
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Exercise 5-9
The Green Acres Inn is trying to determine its break-even point. The inn has 50 rooms that it rents at $50 a night. Operating costs are as follows.
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Salaries |
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$5,600 |
per month |
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Utilities |
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$1,200 |
per month |
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Depreciation |
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$800 |
per month |
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Maintenance |
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$400 |
per month |
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Maid service |
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$6 |
per room |
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Other costs |
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$24 |
per room |
Determine the inn’s break-even point in (1) number of rented rooms per month and (2) dollars.
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(1) |
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Break-even point |
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rooms |
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(2) |
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Break-even point |
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$
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Exercise 5-16
Glacial Company estimates that variable costs will be 60% of sales, and fixed costs will total $756,960. The selling price of the product is $4. Compute the break-even point in (1) units and (2) dollars.
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(1) |
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Break-even sales |
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units |
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(2) |
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Break-even sales |
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$
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Compute the margin of safety in (1) dollars and (2) as a ratio, assuming actual sales are $2,336,296. (Round ratio to 0 decimal places, e.g. 20%.)
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(1) |
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Margin of safety |
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$
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(2) |
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Margin of safety ratio |
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% |
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