week 6 accounting problems

Exercise 21-3

Thome and Crede, CPAs, are preparing their service revenue (sales) budget for the coming year (2017). The practice is divided into three departments: auditing, tax, and consulting. Billable hours for each department, by quarter, are provided below.

Department		Quarter 1		Quarter 2		Quarter 3		Quarter 4
Auditing		2,520		1,870		2,100		2,620
Tax		3,150		2,790		2,310		2,680
Consulting		1,770		1,770		1,770		1,770

Average hourly billing rates are auditing $82, tax $93, and consulting $102. Prepare the service revenue (sales) budget for 2017 by listing the departments and showing for each quarter and the year in total, billable hours, billable rate, and total revenue.

THOME AND CREDE, CPAs Sales Revenue Budget
	Quarter 1	Quarter 2
Dept.	Billable Hours	Billable Rate	Total Rev.	Billable Hours	Billable Rate	Total Rev.
Auditing		$	$		$	$
Tax
Consulting
Totals			$			$

WHEN YOU ANSWER THIS PUT IT IN TABLE FORM IT WILL BE EASIER FOR ME TO KNOW WHAT ANSER GOES WHERE!

Exercise 23-1

Parsons Company is planning to produce 1,100 units of product in 2017. Each unit requires 2.60 pounds of materials at $4.80 per pound and a half-hour of labor at $14.00 per hour. The overhead rate is 90% of direct labor. (a) Compute the budgeted amounts for 2017 for direct materials to be used, direct labor, and applied overhead.

Direct materials		$
Direct labor		$
Overhead		$

(b) Compute the standard cost of one unit of product. (Round answer to 2 decimal places, e.g. 2.75.)

Standard cost

$

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Brief Exercise 20-3

At Bargain Electronics, it costs $35 per unit ($18 variable and $17 fixed) to make an MP3 player at full capacity that normally sells for $50. A foreign wholesaler offers to buy 3,250 units at $24 each. Bargain Electronics will incur special shipping costs of $3 per unit. Assuming that Bargain Electronics has excess operating capacity, indicate the net income (loss) Bargain Electronics would realize by accepting the special order. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

		Reject Order		Accept Order		Net Income Increase (Decrease)
Revenues		$		$		$
Costs-Manufacturing
Shipping
Net income		$		$		$

The special order should be .

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Brief Exercise 20-4

Manson Industries incurs unit costs of $7 ($5 variable and $2 fixed) in making an assembly part for its finished product. A supplier offers to make 14,700 of the assembly part at $6 per unit. If the offer is accepted, Manson will save all variable costs but no fixed costs. Prepare an analysis showing the total cost saving, if any, Manson will realize by buying the part. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

		Make		Buy		Net Income Increase (Decrease)
Variable manufacturing costs		$		$		$
Fixed manufacturing costs
Purchase price
Total annual cost		$		$		$

The decision should be to the part.

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Brief Exercise 20-8

Lisah, Inc., manufactures golf clubs in three models. For the year, the Big Bart line has a net loss of $5,300 from sales $199,000, variable costs $175,000, and fixed costs $29,300. If the Big Bart line is eliminated, $19,600 of fixed costs will remain. Prepare an analysis showing whether the Big Bart line should be eliminated. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

		Continue		Eliminate		Net Income Increase (Decrease)
Sales		$		$		$
Variable costs
Contribution margin
Fixed costs
Net Income / (Loss)		$		$		$

The Big Bart product line should be .