1. The accountant was going over last fiscal year's sales to calculate profit and is interested in December through March. In February and March, backorder spare parts necessitated that the metals were outsourced. What was the pre-shipping profit for those months?
2. Calculate the projected transportation costs for the firm for next year. Assume that the products were shipped in equal amounts to the two distributors. Assume also that the average sales for the four months given will be the average for the entire year.
3. All sales that are covered under a warranty require the firm to keep a certain level of cash for warranty liability or reserves. This is based on the sales and percentage of the products estimated to fail. What is the warranty liability for all the bicycles estimated to be sold during next December.