Questions from General Accounting

Q: Zola Company manufactures and sells one product. The following information pertains

Zola Company manufactures and sells one product. The following information pertains to the company’s first year of operations: Variable cost per unit: Direct materials ..................................

Q: Phoenix Company manufactures only one product and uses a standard cost system

Phoenix Company manufactures only one product and uses a standard cost system. The company uses a plantwide predetermined overhead rate that relies on direct labor-hours as the allocation base The pre...

Q: The management of Kunkel Company is considering the purchase of a $

The management of Kunkel Company is considering the purchase of a $27,000 machine that would reduce operating costs by $7,000 per year. At the end of the machine’s five-year useful life, it will have...

Q: Wendell’s Donut Shoppe is investigating the purchase of a new $18

Wendell’s Donut Shoppe is investigating the purchase of a new $18,600 donut-making machine. The new machine would permit the company to reduce the amount of part-time help needed, at...

Q: Lukow Products is investigating the purchase of a piece of automated equipment

Lukow Products is investigating the purchase of a piece of automated equipment that will save $400,000 each year in direct labor and inventory carrying costs. This equipment costs $2,500,000 and is ex...

Q: Derrick Iverson is a divisional manager for Holston Company. His annual

Derrick Iverson is a divisional manager for Holston Company. His annual pay raises are largely determined by his division’s return on investment (ROI), which has been above 20% each...

Q: The Cambro Foundation, a nonprofit organization, is planning to invest

The Cambro Foundation, a nonprofit organization, is planning to invest $104,950 in a project that will last for three years. The project will produce net cash inflows as follows: Year 1 …………………………………...

Q: A piece of labor-saving equipment has just come onto the

A piece of labor-saving equipment has just come onto the market that Mitsui Electronics, Ltd., could use to reduce costs in one of its plants in Japan. Relevant data relating to the equipment follow:...

Q: Henrie’s Drapery Service is investigating the purchase of a new machine for

Henrie’s Drapery Service is investigating the purchase of a new machine for cleaning and blocking drapes. The machine would cost $137,320, including freight and installation. Henrie’s estimated the ne...

Q: Below are certain events that took place at Hazzard, Inc.,

Below are certain events that took place at Hazzard, Inc., last year: a. Collected cash from customers. b. Paid cash to repurchase its own stock. c. Borrowed money from a creditor. d. Paid suppliers f...