1. The overhead allocation rate used in the 1987 model year strategy study at the Automotive Component & Fabrication Plant (ACF) was 435% of direct labor dollar cost. Calculated the overhead allocation rate using the 1987 model year budget. Calculate the overhead allocation rate for each of the model years 1988 through 1990. Are the changes since 1987 in overhead allocation rates significant? Why have these changes occurred? Solution: Based on the given info we calculate Overhead Allocation
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Time Value of Money Q1. Mr. Sundaram is planning to retire this year. His company can pay him a lump sum retirement payments of Rs 2‚ 00‚000 or Rs 25‚000 life time annuity whichever he chooses. Mr. Sundaram is in good health and estimates to live for at least 20 more years. If his interest rate is 12%‚ which alternative should he choose? Ans Present Value of Annuity 25000*7.469*1.12 = 2‚09‚132 Which is greater than lump sum value of Rs. 2‚00‚000. So Annuity option is better
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Assignment 3 Question 1 Question 2 Question 3 a) It would be beneficial for the company as a whole if logs were transferred to the Sawing Division at the suggested price of $61.50 per log. CM from selling externally = $75 - $40.50 - $9.50 = $25/unit $25 x 10‚000 units = $250‚000 CM from selling to Sawing division = $122-Trasnfer costs from Harvesting-Production costs = $122-40.50-9.50-35-4.5-2.5 = $30/unit $30 x 10‚000 units = $300‚000 $300‚000 - $250‚000 = $50‚000 The CM is greater
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PROBLEM 2-21B Predetermined Overhead Rate; Disposition of Underapplied or Overapplied Overhead (LO1‚ LO7) CHECK FIGURE (2) Underapplied: $68‚600 Adriana Company is highly automated and uses computers to control manufacturing operations. The company uses a job-order costing system and applies manufacturing overhead cost to products on the basis of computer-hours. The following estimates were used in preparing the predetermined overhead rate at the beginning of the year: Computer-hours
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1-5 a. Historical costs are not useless in rapidly changing environment. Even though it does not tell us the fair market value of a certain item‚ it gives us an idea of how the price has changed as time passes. It allows us to record the depreciation and forecast the future costs. b. 1-8 2-4 A lotion bundle consists of 2 cases of 4oz‚ 4 cases of 8oz and 1 case of 12oz bottles. For each lotion bundle: Revenue=2*$36+4*$66+1*72=$408‚ Variable cost=2*$13+4*$24.5+1*27=$151 Contribution
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Case 8-29 1. a. Sales budget: April May June Quarter Budgeted sales in units 35‚000 45‚000 60‚000 140‚000 Selling price per unit × $8 × $8 × $8 × $8 Total sales $280‚000 $360‚000 $480‚000 $1‚120‚000 b. Schedule of expected cash collections: February sales $ 48‚000 $ 48‚000 March sales 112‚000 $ 56‚000 168‚000 April sales 70‚000 140‚000 $ 70‚000 280‚000 May sales 90‚000 180
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OL3210--Principles of Managerial Accounting—unit 2 complete There are various ways that financial statement information is presented in this article on Nokia. The first way I see is in the Good News section on page 1 “the bulk of its revenues—more than quadrupled‚ from $2.1 billion in 1993 to $8.7 billion last year (1997)‚” and on say “the recent June quarter surging to $616 million‚ up 76% from the same quarter in 1997” this is an partial example of an horizontal analysis (Stone‚ 1998). A horizontal
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Chapter 01 The Changing Role of Managerial Accounting in a Dynamic Business Environment True / False Questions 1. Controlling involves the coordination of daily business functions within an organization. True False 2. Measuring the performance of managers and subunits is not an objective of managerial accounting. True False 3. Middle-level managers would likely be considered internal users of accounting information rather than external users. True False
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Problem 19-2: Vt. Sugar Enterprises Given: Syrup Sugar Total Units produced 20‚000 1‚000 21‚000 Unit selling price $15.00 $2.00 Total process costs: After split-off $12‚000 $280 $12‚280 Joint costs $100‚000 a. Calculate the cost of the syrup if the sugar is considered a by-product and the gross margin from its sale is considered to be a reduction of syrup costs. Products Sales Value Costs beyond split-off Difference Joint costs allocation Syrup $300‚000 12‚000 288‚000
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1. The Allen Company uses a job-order costing system. The following activity took place during the month of March: Required: Prepare journal entries to record the information above. Key your entries by the letters a through i. Assume all purchases are made on account. 1 2 2. Hirpara Inc. has provided the following data for July: Required: Prepare T-accounts for Raw Materials‚ Work in Process‚ Finished Goods‚ and Manufacturing Overhead‚ and Cost of Goods Sold. Record the beginning
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