Question: Knitpix Products is a division of Parker

> The following information pertains to Chacon Inc. for last year:Beginning inventory in units ……………………………………………. 5,000Units produced ……………………………………………………………… 20,000Units sold ……………………………………………………………………… 23,700Costs per unit:Direct materials ……………………………………

> Susan Lewis, owner of a florist shop, is interested in predicting the cost of delivering floral arrangements. She collected monthly data on the number of deliveries and the total monthly delivery cost (depreciation on the van, wages of the driver, and fu

> The controller for Beckham Company believes that the number of direct labor hours is associated with overhead cost. He collected the following data on the number of direct labor hours and associated factory overhead cost for the months of January through

> Luisa Crimini has been operating a beauty shop in a college town for the past 10 years. Recently, Luisa rented space next to her shop and opened a tanning salon. She anticipated that the costs for the tanning service would primarily be fixed but found th

> Bender Automotive Works Inc. manufactures a variety of front-end assemblies for automobiles. A front-end assembly is the unified front of an automobile that includes the headlamps, fender, and surrounding metal/plastic. Bender has two producing departmen

> At the beginning of the year, Smith Company budgeted overhead of $129,600 as well as 13,500 direct labor hours. During the year, Job K456 was completed with the following information: direct materials cost, $2,750; direct labor cost, $5,355. The average

> Smooth Move Company manufactures professional paperweights and has been approached by a new customer with an offer to purchase 15,000 units at a per-unit price of $7.00. The new customer is geographically separated from Smooth Move’s other customers, and

> The Lubbock plant of Morril’s Small Motor Division produces a major subassembly for a 6.0 horsepower motor for lawn mowers. The plant uses a standard costing system for production costing and control. The standard cost sheet for the subassembly follows:D

> Willow Company produces lawn mowers. One of its plants produces two versions of mowers: a basic model and a deluxe model. The deluxe model has a sturdier frame, a higher horsepower engine, a wider blade, and mulching capability. At the beginning of the y

> Ramsey Company produces speakers (Model A and Model B). Both products pass through two producing departments. Model A’s production is much more labor-intensive than that of Model B. Model B is also the more popular of the two speakers.

> Suppose that Kicker had the following sales and cost experience (in thousands of dollars) for May of the current year and for May of the prior year:In May of the prior year, Kicker started an intensive quality program designed to enable it to build origi

> Millie Company produces a product that passes through an assembly process and a finishing process. All manufacturing costs are added uniformly for both processes. The following information was obtained for the assembly department for June:a. WIP, June 1,

> Willison Company produces stuffed toy animals; one of these is Betty Rabbit. Each rabbit takes 0.2 yards of fabric and six ounces of poly fiberfill. Fabric costs $3.50 per yard, and poly fiberfill is $0.05 per ounce. Willison has budgeted production of s

> Folsom Company manufactures specialty tools to customer order. There are three producing departments. Departmental information on budgeted overhead and various activity measures for the coming year is as follows:Currently, overhead is applied on the basi

> The controller of Feinberg Company is gathering data to prepare the cash budget for July. He plans to develop the budget from the following information:a. Of all sales, 40% are cash sales.b. Of credit sales, 45% are collected within the month of sale. Ha

> Alfombra Inc. manufactures throw rugs. The throw-rug department weaves cloth and yarn into throw rugs of various sizes. Alfombra uses the weighted average method. Materials are added uniformly throughout the weaving process. In August, Alfombra switched

> Farnsworth Company has gathered data on its overhead activities and associated costs for the past 10 months. Tracy Heppler, a member of the controller’s department, has convinced management that overhead costs can be better estimated an

> Cuneo Company’s income statements for the last 3 years are as follows:Required:1. Prepare a common-size income statement for Year 1 by expressing each line item as a percentage of sales revenue. (Note: Round percentages to the nearest t

> Tristar Manufacturing produces two types of battery-operated toy soldiers: infantry and special forces. The soldiers are produced by using one continuous process. Four activities have been identified: machining, setups, receiving, and packing. Resource d

> Orchard Fresh Inc. purchases fruit from numerous growers and packs fruit boxes and fruit baskets for sale. Orchard Fresh has developed the following flexible budget for overhead for the coming year. Activity level is measured in direct labor hours.Requir

> Hayward Company, a manufacturing firm, has supplied the following information from its accounting records for the month of May:Direct labor cost ……………………………………………………………………………..…… $10,500Purchases of raw materials …………………………………………………………………… 15,000Supplies

> Allison Manufacturing produces a subassembly used in the production of jet aircraft engines. The assembly is sold to engine manufacturers and aircraft maintenance facilities. Projected sales in units for the coming five months follow:January â&#128

> Botella Company produces plastic bottles. The unit for costing purposes is a case of 18 bottles. The following standards for producing one case of bottles have been established:Direct materials (4 lbs. @ $0.95) ……………………………. $ 3.80Direct labor (1.25 hours

> Phono Company manufactures a plastic toy cell phone. The following standards have been established for the toy’s materials and labor inputs:During the first week of July, the company had the following results:Units produced â&#128

> Mike Sanders is considering the purchase of Kepler Company, a firm specializing in the manufacture of office supplies. To be able to assess the financial capabilities of the company, Mike has been given the company’s financial statement

> Grammatico Company has just completed its third year of operations. The income statement is as follows:Sales …………………………………………………………………………… $ 2,460,000Less: Cost of goods sold ………………………………………………… (1,410,000)Gross profit margin ……………………………………………………… $ 1,05

> Farnsworth Company has gathered data on its overhead activities and associated costs for the past 10 months. Tracy Heppler, a member of the controller’s department, has convinced management that overhead costs can be better estimated an

> Foster Company wants to buy a numerically controlled (NC) machine to be used in producing specially machined parts for manufacturers of trenching machines (to replace an existing manual system). The outlay required is $3,500,000. The NC equipment will la

> Each of the following scenarios is independent. Assume that all cash flows are after-tax cash flows.a. Cobre Company is considering the purchase of new equipment that will speed up the process for extracting copper. The equipment will cost $3,600,000 and

> The following selected information is taken from the financial statements of Arnn Company for its most recent year of operations:Beginning balances:Inventory ……………………………………………… $200,000Accounts receivable ………………………………… 300,000Ending balances:Inventory ……

> Bowman Company manufactures cooling systems. Bowman produces all the parts necessary for its product except for one electronic component, which is purchased from two local suppliers: Manzer Inc. and Buckner Company. Both suppliers are reliable and seldom

> Ladan Suriman, controller for Healthy Pet Company, has been instructed to develop a flexible budget for overhead costs. The company produces two types of dog food. Basic Diet is a standard mixture for healthy dogs. Special Diet is a reduced protein formu

> The maternity wing of the city hospital has two types of patients: normal and cesarean. The standard quantities of labor and materials per delivery for 2013 are:\[/\]/The standard price paid per pound of direct materials is $10. The standard rate for lab

> Basu Company produces two types of sleds for playing in the snow: basic sled and aerosled. The projected income for the coming year, segmented by product line, follows:The selling prices are $30 for the basic sled and $60 for the aerosled.Required:1. Com

> Suppose that Stillwater Designs has two classes of distributors: JIT distributors and non JIT distributors. The JIT distributor places small, frequent orders, and the non JIT distributor tends to place larger, less frequent orders. Both types of distribu

> Jasper Company provided the following information for last year:Sales in units ………………………………………………. 280,000Selling price ………………………………………………………. $ 12Direct materials …………………………………………… 180,000Direct labor …………………………………………………. 505,000Manufacturing overhead …

> Zanda Drug Corporation buys three chemicals that are processed to produce two types of analgesics used as ingredients for popular over-the-counter drugs. The purchased chemicals are blended for two to three hours and then heated for 15 minutes. The resul

> Booth Manufacturing has provided the following financial statements.\[/\]/Booth ManufacturingIncome StatementFor the Year Ended December 31, 2014Revenues …………â€&br

> Suppose that a surgical ward has gathered the following information for four nursing activities and two types of patients:Required:1. Determine the total nursing costs assigned to each patient category.2. Output is measured in patient days. Assuming that

> The following information pertains to Chacon Inc. for last year:Beginning inventory in units ………………………………………. 5,000Units produced ………………………………………………………… 20,000Units sold …………………………………………………………………. 23,700Costs per unit:Direct materials …………………………………………………

> Dr. Whitley Avard, a plastic surgeon, had just returned from a conference in which she learned of a new surgical procedure for removing wrinkles around eyes, reducing the time to perform the normal procedure by 50%. Given her patient-load pressures, Dr.

> Booth Manufacturing has provided the following financial statements.Booth ManufacturingIncome StatementFor the Year Ended December 31, 2014Revenues ……………&

> Golding Company, a job-order costing firm, worked on three jobs in July. Data are as follows:Overhead is applied to jobs at the rate of $16 per machine hour. By July 31, Jobs 106 and 108 were completed. Jobs 102 and 106 were sold. Job 107 remained in pro

> Ondi Airlines is interested in acquiring a new aircraft to service a new route. The route will be from Tulsa to Denver. The aircraft will fly one round-trip daily except for scheduled maintenance days. There are 15 maintenance days scheduled each year. T

> The following financial statements were provided by Roberts Company:\]/At the end of 2014, Roberts purchased some additional equipment for $20,000.Required:Calculate operating cash flows using the direct method

> Mino Inc. manufactures chocolate syrup in three departments: Cooking, Mixing, and Bottling. Mino uses the weighted average method. The following are cost and production data for the cooking department for April (Note: Assume that units are measured in ga

> Langer Company produces plastic items, including plastic housings for humidifiers. Each housing requires about 15 ounces of plastic costing $0.08 per ounce. Langer molds the plastic into the proper shape. Langer has budgeted production of the housings fo

> Juroe Company provided the following income statement for last year:Sales …………………………………………………………..……… $11,300,000Cost of goods sold ………………………………………………… 3,000,000Gross margin …………………………………………….……… $ 8,300,000Operating expenses ……………………………………………… 3,800,

> In March, Chilton Company purchased materials costing $25,000 and incurred direct labor cost of $10,000. Overhead totaled $42,000 for the month. Information on inventories was as follows:\[/\]/Required:1. What was the cost of direct materials used in Mar

> Smooth Move Company manufactures professional paperweights and has been approached by a new customer with an offer to purchase 15,000 units at a per-unit price of $7.00. The new customer is geographically separated from Smooth Move’s other customers, and

> The following information was obtained for the grinding department of Harlan Company for May:a. BWIP had 91,500 units, 30% complete with respect to manufacturing costs.b. EWIP had 25,200 units, 25% complete with respect to manufacturing costs.c. Started

> Alard Company produces blenders and coffee makers. During the past year, the company produced and sold 65,000 blenders and 75,000 coffee makers. Fixed costs for Alard totaled $340,000, of which $184,000 can be avoided if the blenders are not produced and

> Peanut-Fresh Inc. produces all-natural organic peanut butter. The peanut butter is sold in 12-ounce jars. The sales budget for the first four months of the year is as follows:Company policy requires that ending inventories for each month be 20% of next m

> At the beginning of the year, Lopez Company had the following standard cost sheet for one of its chemical products:Direct materials (4 lbs. @ $2.80) ………………… $11.20Direct labor (2 hrs. @ $18.00) ……………………... 36.00FOH (2 hrs. @ $5.20) …………………………………. 10.40VO

> Borques Company produces and sells wooden pallets that are used for moving and stacking materials. The operating costs for the past year were as follows:Variable costs per unit:Direct materials ……………………………………… $2.85Direct labor …………………………………………….. $1.92V

> H. Banks Company would like to design, produce, and sell versatile toasters for the home kitchen market. The toaster will have four slots that adjust in thickness to accommodate both slim slices of bread and oversized bagels. The target price is $60. Ban

> The income statement for Piura Merchandising Corporation is as follows:Other information is as follows:a. Accounts payable decreased by $20,000 during the year.b. Accounts receivable increased by $20,000.c. All wages were paid at the beginning of the yea

> Texas-Q Company produces and sells barbeque grills. Texas-Q sells three models: a small portable gas grill, a larger stationary gas grill, and the specialty smoker. In the coming year, Texas-Q expects to sell 20,000 portable grills, 50,000 stationary gri

> Leslie Blandings, division manager of Audiotech Inc., was debating the merits of a new product—a weather radio that would put out a warning if the county in which the listener lived were under a severe thunderstorm or tornado alert.The budgeted income of

> Bryce Company manufactures pet supplies. However, Bryce’s electronic accounting system recently crashed and, unfortunately, only a partial recovery of the company’s year-end accounting records (which included several profitability ratios) was possible. A

> Each of the following scenarios is independent. Assume that all cash flows are after-tax cash flows.a. Colby Hepworth has just invested $400,000 in a book and video store. She expects to receivea cash income of $120,000 per year from the investment.b. Ky

> During the past year, the high and low use of three different resources for Fly High Airlines occurred in July and April. The resources are airplane depreciation, fuel, and airplane maintenance. The number of airplane flight hours is the driver. The tota

> Cherry Blossom Products Inc. produces and sells yoga-training products: how-to DVDs and a basic equipment set (blocks, strap, and small pillows). Last year, Cherry Blossom Products sold 13,500 DVDs and 4,500 equipment sets. Information on the two product

> Cherry Blossom Products Inc. produces and sells yoga-training products: how-to DVDs and a basic equipment set (blocks, strap, and small pillows). Last year, Cherry Blossom Products sold 13,500 DVDs and 4,500 equipment sets. Information on the two product

> Oliver Company provided the following information for the years 2013 and 2014:Oliver CompanyIncome StatementFor the Year Ended December 31, 2014Sales …………â€&brvbar

> Budgeted amounts for the year:Materials ………………………………….. 2 leather strips @ $7.00Labor …………………….…………………………….. 1.5 hr. @ $18.00VOH ……………………………..………………………… 1.5 hr. @ $1.20FOH …………………………………………………………………… $6,800Required:1. Prepare a flexible budget for 3,500,

> Information on four independent companies follows. Calculate the correct amount for each question mark. (Note: Round unit dollar amounts and ratios to two decimal places; round break-even units to the nearest whole unit.),,,

> Spiro Hospital is investigating the possibility of investing in new dialysis equipment. Two local manufacturers of this equipment are being considered as sources of the equipment. After-tax cash inflows for the two competing projects are as follows:Both

> For the coming year, Paulson Computers Inc. expects to produce 144,000 computers. Of these, 64,000 will be consumer (personal) computers and 80,000 will be small business computers. Common fixed overhead is $1,700,000. Additional information for the comi

> Cinturon Corporation produces high-quality leather belts. The company’s plant in Boise uses a standard costing system and has set the following standards for materials and labor:Leather (3 strips @ $4) …………………………… $12.00Direct labor (0.75 hr. @ $12) …………

> Quillen Company manufactures a product in a factory that has two producing departments, Cutting and Sewing, and two support departments, S1 and S2. The activity driver for S1 is number of employees, and the activity driver for S2 is number of maintenance

> Pelak Company had sales of $25,000,000, expenses of $17,500,000, and average operating assets of $10,000,000.Required:Compute the (1) operating income,(2) margin and turnover ratios, and(3) ROI

> The following accounting information pertains to two retail stores that specialize in selling winter ski gear. Aspen Sports operates only a few locations and has a market strategy of selling only high-end ski gear. Discount Ski has many locations but sel

> Beth Malone owned a small company that sold boating equipment. The equipment was expensive, and a perpetual system was maintained for control purposes. Even so, lost, damaged, and stolen merchandise normally amounted to 5 percent of the inventory balance

> Frank Jones, the owner of Frank’s Hunting Supplies, is surprised at the amount of actual inventory at the end of the year. He thought there should be more inventory on hand based on the amount of sales for the year. The following inform

> The ending inventory for Oak Co. was erroneously written down, causing an understatement of $6,500 at the end of Year 2. Required: Was each of the following amounts overstated, understated, or not affected by the error? Item No. Year Amount Year 2

> Bosh Company failed to count $22,000 of inventory in its Year 1 year-end physical count. Required: Explain how this error will affect Bosh’s Year 1 financial statements, assuming that Bosh uses the perpetual inventory system.

> Harvey Company carries three inventory items. The following information pertains to the ending inventory: Required: a. Determine the ending inventory that will be reported on the balance sheet, assuming that Harvey applies the lower-of-cost-or market r

> The following information pertains to James Hardware’s ending inventory for the current year: Required: a. Determine the value of the ending inventory using the lower-of-cost-or-market rule applied to (1) each individual inventory ite

> Nash Auto Parts, Inc. had the following transactions for Year 2: Required: a. Determine the quantity and dollar amount of inventory at the end of the year, assuming Nash Auto Parts, Inc. uses the FIFO cost flow assumption and keeps perpetual records. b

> The following inventory transactions apply to Duncan Steel Company for Year 2: The beginning inventory consisted of 180 units at $10 per unit. All transactions are cash transactions. Required: a. Record these transactions in general journal format ass

> Home Gifts Inc. had cash sales of $112,500 for Year 1, its first year of operation. On April 2, the company purchased 150 units of inventory at $180 per unit. On September 1, an additional 200 units were purchased for $200 per unit. The company had 50 un

> The following information pertains to the inventory of the Bryant Company: During the year, Bryant sold 3,500 units of inventory at $50 per unit and incurred $21,000 of operating expenses. Bryant currently uses the FIFO method but is considering a chan

> Scott Sales had the following transactions for jackets in Year 1, its first year of operations: During the year, Scott Sales sold 830 jackets for $40 each. Required: a. Compute the amount of ending inventory Scott would report on the balance sheet, as

> The following information pertains to Stanley Company for Year 2: Ending inventory consisted of 40 units. Stanley sold 370 units at $30 each. All purchases and sales were made with cash. Required: a. Compute the gross margin for Stanley Company using

> The Shirt Shop had the following transactions for T-shirts for Year 1, its first year of operations: During the year, The Shirt Shop sold 810 T-shirts for $20 each. Required: a. Compute the amount of ending inventory The Shirt Shop would report on the

> Cortez Company sells chairs that are used at computer stations. Its beginning inventory of chairs was 100 units at $60 per unit. During the year, Cortez made two batch purchases of this chair. The first was a 150-unit purchase at $68 per unit; the second

> Generally accepted accounting principles (GAAP) and International Financial Reporting Standards (IFRS) treat the LIFO inventory cost flow method differently. Required: a. Briefly describe the position GAAP takes with respect to LIFO. b. Briefly describe

> The following information related to accounting for inventory was taken from the 2016 annual report of Costco Wholesale Corporation: Merchandise inventories consist of the following at the end of 2016 and 2015: Merchandise inventories are valued at the

> The following accounting information pertains to two grocery store chains. One grocery store chain has a market strategy of selling only high-end organic food products while the other grocery store sells less expensive foods that are traditionally grown

> Brad Essary owned a small company that sold garden equipment. The equipment was expensive, and a perpetual system was maintained for control purposes. Even so, lost, damaged, and stolen merchandise normally amounted to 5 percent of the inventory balance.

> A substantial portion of inventory owned by Prentiss Sporting Goods was recently destroyed when the roof collapsed during a rainstorm. Prentiss also lost some of its accounting records. Prentiss must estimate the loss from the storm for insurance reporti

> Using Coca-Cola Company’s most current Form 10-K, answer the questions below. To obtain the Form 10-K, you can use the EDGAR system, following the instructions in Appendix A, or it can be found on the company’s website. Required: a. What was Coke’s gros

> The ending inventory for Carver Co. was incorrectly adjusted, which caused it to be understated by $15,300 for Year 2. Required: Was each of the following amounts overstated, understated, or not affected by the error? Item No. Year Amount 1 Year 2

> Stubbs Company failed to count $55,000 of inventory in its Year 1 year-end physical count. Required: Write a memo explaining how Stubbs Company’s balance sheet will be affected in Year 1. Assume Stubbs uses the perpetual inventory system.

> Brooks Company carries three inventory items. The following information pertains to the ending inventory: a. Determine the ending inventory that Brooks will report on the balance sheet, assuming that it applies the lower-of-cost-or-market rule to indiv

> The following information pertains to Hagen Metal Works’ ending inventory for the current year: Required: a. Determine the value of the ending inventory using the lower-of-cost-or-market rule applied to (1) each individual inventory i

> The Hat Store had the following series of transactions for Year 2: Required: a. Determine the quantity and dollar amount of inventory at the end of the year, assuming The Hat Store uses the FIFO cost flow assumption and keeps perpetual records. b. Writ

> The following inventory transactions apply to Green Company for Year 2: The beginning inventory consisted of 180 units at $48 per unit. All transactions are cash transactions. Required: a. Record these transactions in general journal format assuming G

> The Brick Company had cash sales of $280,000 for Year 1, its first year of operation. On April 2, the company purchased 210 units of inventory at $390 per unit. On September 1, an additional 160 units were purchased for $425 per unit. The company had 110