Exam 2: Cost Terms,concepts,and Classifications

At a sales volume of 32,000 units, CD Company's total fixed costs are $64,000 and total variable costs are $60,000. The relevant range is 30,000 to 55,000 units. -If CD Company sells 50,000 units,what is the total expected cost per unit? (Do not round intermediate computations).Round final answer to the nearest cent.

Boardman Company reported the following data for the month of January: Inventories: / Raw materials \ 32,000 \ 31,000 Work in process \ 18,000 \ 12,000 Finished goods \ 30,000 \ 35,000 Additional information: Sales revenue \ 210,000 Direct labour costs \ 40,000 Manufacturing overhead costs \ 70,000 Selling expenses \ 25,000 Administrative expenses \ 35,000 -Assuming that cost of goods sold for January was $124,000,what was the net income for January?

What would be the classification of corporate controller's salary?

Boardman Company reported the following data for the month of January: Inventories: / Raw materials \ 32,000 \ 31,000 Work in process \ 18,000 \ 12,000 Finished goods \ 30,000 \ 35,000 Additional information: Sales revenue \ 210,000 Direct labour costs \ 40,000 Manufacturing overhead costs \ 70,000 Selling expenses \ 25,000 Administrative expenses \ 35,000 -If raw materials costing $35,000 were purchased during January,what were the total manufacturing costs for the month?

The following data (in thousands of dollars)have been taken from the accounting records of Larmont Corporation for the year just completed: Sales \ 990 Purchases of raw materials* \ 100 Direct labour \ 240 Indirect labour \ 100 Indirect material \ 10 Other Factory Overhead \ 100 Administrative expenses \ 100 Selling expenses \ 140 Raw materials inventory, beginning* \ 20 Raw materials inventory, ending* \ 80 Work in process inventory, beginning \ 50 Work in process inventory, ending \ 30 Finished goods inventory, beginning \ 160 Finished goods inventory, ending \ 150 *Raw Materials Inventory consist of both direct and indirect materials. Required: (a.)Prepare a schedule of cost of goods manufactured in good form. (b.)Compute the cost of goods sold. (c.)Using data from your answers above as needed,prepare an income statement in good form.

How would the wages of factory maintenance personnel usually be classified?

Haack Inc.is a merchandising company.Last month,the company's cost of goods sold was $84,000.The company's beginning merchandise inventory was $20,000,and its ending merchandise inventory was $18,000.What was the total amount of the company's merchandise purchases for the month?

During January,the cost of goods manufactured was $93,000.The beginning finished goods inventory was $16,000,and the ending finished goods inventory was $20,000.What was the cost of goods sold for the month?

Some companies classify labour fringe benefits for direct labour workers as part of the direct labour cost and some classify these costs as manufacturing overhead.

Bill Pope has developed a new device that is so exciting he is considering quitting his job in order to produce and market it on a large-scale basis.Bill will rent a garage for $300 per month for production purposes.Utilities will cost $40 per month.Bill has already taken an industrial design course at the local community college to help prepare for this venture.The course cost $300.Bill will rent production equipment at a monthly cost of $800.He estimates the material cost will be $5 per unit,and the labour cost will be $3 per unit.He will hire workers and spend his time promoting the product.To do this,he will quit his job,which pays $3,000 per month.Advertising and promotion will cost $900 per month. Required: Complete the chart below by placing an "X" under each heading that helps to identify the cost involved.You can place an "X" under more than one heading for a single cost: for example,a cost may be a sunk cost,an overhead cost,and a product cost; you would place an "X" under each of these headings opposite the cost. * Between the alternatives of going into business to make the device or not going into business to make the device.See columnheading "Differential Cost". Opportunity Cost Sunk Cost Variable Cost Fixed Cost Mfg. Overhead Product Cost Selling Cost Differential Cost Garage rent Utilities Cost of the industrial design course Equipment rented Material cost Labour cost Present salary Advertising

In a manufacturing firm,depreciation is always considered a product cost for external financial reporting purposes.

The following would typically be considered indirect costs of manufacturing a particular Boeing 747 to be delivered to Singapore Airlines: electricity to run production equipment,the factory manager's salary,and the cost of the General Electric jet engines installed on the aircraft.

A brewery produces many variety of beer.If the cost object is a particular brand of beer the factory supervisor salary is classified a/an _____________ cost of the brand of beer and a _____________ cost of the entire division.

Bergeron Inc. reported the following data for last year: Work-in-process inventory, beginning \ 100 Work-in-process inventory, ending \ 150 Finished goods inventory, beginning \ 180 Finished goods inventory, ending \ 200 Direct labour cost \ 300 Direct materials cost \ 500 Manufacturing overhead cost \ 400 -Which of the following is the conversion cost?

The Target store in your home town is one of many Target department stores across the province.Some of the costs associated with the store in your home town last month appear below: Shoe Department Cost of Sales \ 80,000 Other Department Salaries 62,000 Store Managers Salary 14,000 Shoe Department Sales Commissions 8,000 Store Utilities 13,000 Shoe Department Manager's Salary 9,000 Store Lease Cost 11,000 Store Janitorial Costs 11,000 Other Store Costs 98,000 The Shoe Department is one of many departments in the home town store.The direct costs of the Shoe Department total:

Stony Electronics Corporation manufactures a portable radio designed for mounting on the wall of the bathroom.The following list represents some of the different types of costs incurred in the manufacture of these radios: 1)The plant manager's salary. 2)The cost of heating the plant. 3)The cost of heating executive offices. 4)The cost of printed circuit boards used in the radios. 5)Salaries and commissions of company salespersons. 6)Depreciation on office equipment used in the executive offices. 7)Depreciation on production equipment used in the plant. 8)Wages of janitorial personnel who clean the plant. 9)The cost of insurance on the plant building. 10)The cost of electricity to light the plant. 11)The cost of electricity to power plant equipment. 12)The cost of maintaining and repairing equipment in the plant. 13)The cost of printing promotional materials for trade shows. 14)The cost of solder used in assembling the radios. 15)The cost of telephone service for the executive offices. Required: Classify each of the items above as product (inventoriable)cost or period (noninventoriable)costs for the purpose of preparing external financial statements.

Bergeron Inc. reported the following data for last year: Work-in-process inventory, beginning \ 100 Work-in-process inventory, ending \ 150 Finished goods inventory, beginning \ 180 Finished goods inventory, ending \ 200 Direct labour cost \ 300 Direct materials cost \ 500 Manufacturing overhead cost \ 400 -Which of the following is the cost of goods manufactured?

The beginning balance of the raw materials inventory account for May was $27,500.The ending balance for May was $28,750,and $128,900 of raw materials were used during the month.What was the cost of the materials purchased during the month?

The following costs relate to one month's activity in Martin Company: Indirect materials \ 300 Rent on factory building \ 500 Maintenance of equipment \ 50 Direct material used \ 1,200 Utilities on factory \ 250 Direct labour \ 1,500 Selling expense \ 500 Administrative expense \ 300 Work in process inventory, beginning \ 600 Work in process inventory, ending \ 800 Finished goods inventory, beginning \ 500 Finished goods inventory, ending \ 250 Required: (a.)Prepare a schedule of cost of goods manufactured in good form. (b.)Determine the cost of goods sold. (c.)Assume Martin Company produced the equivalentof 500 units during this particular month.What was the average cost per unit for direct materials? For rent on factory building? (d.)Assume next month Martin Company plans to produce 600 units of product.What average cost per unit and total cost would you expect to be incurred for direct material?,for rent?

Logan Products,a small manufacturer,has submitted the items below concerning last year's operations.The president's secretary,trying to be helpful,has alphabetized the list. Administrative salaries \ 2,400 Advertising expense \ 1,200 Depreciation - factory building \ 800 Depreciation - factory equipment \ 1,600 Depreciation - office equipment \ 180 Direct labour cost \ 21,900 Raw materials inventory, beginning \ 2,100 Raw materials inventory, ending \ 3,200 Finished goods inventory, beginning \ 46,980 Finished goods inventory, ending \ 44,410 General liability insurance expense \ 240 Indirect labour cost \ 11,800 Insurance on factory \ 1,400 Purchases on raw materials \ 14,600 Repairs and maintenance of factory \ 900 Sales salaries \ 2,000 Taxes on factory \ 400 Travel and entertainment expense \ 1,410 Work-in-process inventory, beginning \ 1,670 Work-in-process inventory, ending \ 1,110 Required: a.)Prepare a schedule of cost of goods manufactured in good form for the year. b.)Determine the cost of goods sold for the year.