Assignment
Objective
• To understand and solidify introductory financial accounting course concepts and techniques
• Description
• Managerial Accounting focuses heavily on finding solutions to numerical problems. With that in mind, most units will include a number of problems. For each problem, you will need to provide more than a simple numerical response. Your solutions should thoroughly address the issue and present the findings in a meaningful format similar to those developed within the chapters and as part of the review exercises solutions. Part value may be assigned for incorrect responses.
Question 1:
• The following information was taken from the accounting records of Dunbar Mifflin Company in 2018.
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Beginning of 2018
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Ending of 2018
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Direct materials inventory
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135,000
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83,000
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Work-in-process inventory
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185,000
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154,000
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Finished-goods inventory
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255,000
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216,000
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Purchases of direct materials
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270,000
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Direct manufacturing labor
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225,000
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Indirect manufacturing labor
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103,000
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Plant insurance
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11,000
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Depreciation-plant, building, and equipment
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48,000
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Plant utilities
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29,500
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Repairs and maintenance-plant
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13,500
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Equipment leasing costs
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66,800
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Marketing, distribution, and customer-service costs
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129,500
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General and administrative costs
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72,500
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Required:
1) Prepare a schedule of cost of goods manufactured.
Question 2:
• Following are the account balances for the DC Company in 2018:
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Beginning of 2018
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Ending of 2018
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Direct materials inventory
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26,500
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27,000
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Work-in-process inventory
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30,500
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28,400
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Finished-goods inventory
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16,500
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22,100
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Purchases of direct materials
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79,000
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Direct manufacturing labor
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24,500
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Indirect manufacturing labor
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18,600
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Plant insurance
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7,900
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Depreciation-plant, building, and equipment
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11,800
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Repairs and maintenance-plant
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3,500
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Marketing, distribution, and customer-service costs
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87,900
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General and administrative costs
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26,500
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Required:
1) Prepare a schedule for the cost of goods manufactured for 2018.
2) Revenues for 2018 was $425,000. Prepare the income statement for 2018.
Question 3:
• Identify if the following costs are "product" or "period" costs:
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COST
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Period Cost or Product Cost?
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1. Television advertisements for Bailey's products
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2. Lubricants used in running bottling machines
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3. Research and Development related to elimination of antibiotic residues in milk
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4. Gasoline used to operate refrigerated trucks delivering finished dairy products to grocery stores
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5. Company president's annual bonus
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6. Depreciation on refrigerated trucks used to collect raw milk
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7. Plastic gallon containers in which milk is packaged
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8. Property insurance on dairy processing plant
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9. Cost of milk purchased from local dairy farmers
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10. Depreciation on tablets used by sales staff
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11. Depreciation on chairs and tables in the factory lunchroom.
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12. The cost of packaging the company's product.
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13. The wages of the receptionist in the administrative offices.
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14. Cost of leasing the corporate jet used by the company's executives.
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15. The cost of renting rooms at a BC resort for the annual conference.
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Question 4:
The Trump International Hotel & Tower is a five-star hotel located in downtown Toronto. The hotel's operations vice president would like to replace the hotel's legacy computer terminals at the registration desk with attractive state-of-the-art flat-panel displays. The new displays would take less space, consume less power than the old computer terminals, and provide additional security, since they can be viewed only from a restrictive angle. The new computer displays would not require any new wiring. However, the hotel's chef believes the funds would be better spent on a new bulk freezer for the kitchen.
Required:
1) Classify each item as a differential cost, an opportunity cost, or a sunk cost in the decision to replace the old computer terminals with new flat-panel displays. If none of the categories apply for a particular item, select "None".
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Item
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Differential Cost
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Opportunity Cost
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Sunk Cost
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None
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Cost of the old computer terminals
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Rent on the space occupied by the registration desk
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Benefits from a new freezer
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Cost of removing the old computer terminals
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Cost of the new flat-panel displays
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Wages of registration desk personnel
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Cost of existing registration desk wiring
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Format your assignment according to the following formatting requirements:
1. The answer should be typed, double spaced, using Times New Roman font (size 12), with one-inch margins on all sides.
2. The response also includes a cover page containing the title of the assignment, the student's name, the course title, and the date. The cover page is not included in the required page length.
3. Also include a reference page. The Citations and references should follow APA format. The reference page is not included in the required page length.