Week 1 discussionCost Terms, Classifications, and Behavior (graded)Welcome to our Week 1 Discussions! To get us started, let’s consider the following questions.1) Would a traditional income statement differ depending on whether the business is a service organization, merchandiser, or manufacturer?2) Could we use managerial accounting tools to assess the profitability of an organization other than a manufacturing business, or are the topics that we are learning only related to manufacturing?3) If we could use these concepts in service and/or merchandising businesses, how would we go about doing so?Let’s start with the first question.Research and Application (graded)Go to page 130, Case 3-30, Ethics and the Manager. Letâs discuss the questions, make value-added comments, points, and share personal experiences of unethical situations.Week 2 discussionJob Order and Process Costing Systems (graded)Welcome to our Week 2 Discussions! Let’s begin by discussing when job order costing systems would be more appropriate than a process costing system.Research and Application (graded)Go to page 166 and read Case 4-19, Ethics and the Manager: Understanding the Impact of Percentage Completion on Profit. Letâs address the questions, provide reasons for our answers, share relevant personal experiences, and provide value-added comments, articles, and related websites. Letâs have a lot of interaction.Week 3 discussionVariable Costing and CVP concepts (graded)Welcome to our Week 3 Discussions! To get us started, let’s discuss how CVP analysis is used in managerial accounting decision-making. âResearch and Application (graded)Below is the link that will take you directly to the 2004 financial statements of the Benetton Group, followed by the discussion questions..benettongroup.com/sites/all/temp/doc/2004_annual_report_en.pdf”>http://www.benettongroup.com/sites/all/temp/doc/2004_annual_report_en.pdf Let’s answer these questions in the order that they appear.1. How do the formats of the income statements shown on pages 33 and 50 of Benettonâs annual report differ from one another (disregard everything beneath the line titled âincome from operationsâ)? Which expenses shown on page 50 appear to have been reclassified as variable selling costs on page 33?2. Why do you think cost of sales is included in the computation of contribution margin on page 33?3. Perform two separate computations of Benettonâs break-even point in euros. For the first computation, use data from 2003. For the second computation, use data from 2004. Why do the numbers that you computed differ from one another?4. What sales volume would have been necessary in 2004 for Benetton to attain a target income from operations of â¬300 million?5. Compute Benettonâs margin of safety using data from 2003 and 2004. Why do your answers for the two years differ from one another?6. What is Benettonâs degree of operating leverage in 2004? If Benettonâs sales in 2004 had been 6% higher than what is shown in the annual report, what income from operations would the company have earned? What percentage increase in income from operations does this represent?7. What income from operations would Benetton have earned in 2004 if it had invested an additional â¬10 million in advertising and promotions and realized a 3% increase in sales? As an alternative, what income from operations would Benetton have earned if it not only invested an additional ?10 million in advertising and promotions but also raised its sales commission rate to 6% of sales, thereby generating a 5% increase in sales? Which of these two scenarios would have been preferable for Benetton?8. Assume that total sales in 2004 remained unchanged at, â¬1,686 million (as shown on pages 33 and 50); however, the Casual sector sales were, â¬1,504 million, the Sportswear and Equipment sector sales were â¬75 million, and the Manufacturing and Other sector sales were â¬107 million. What income from operations would Benetton have earned with this sales mix? (Hint: look at pages 36 and 37 of the annual report.) Why is the income from operations under this scenario different from what is shown in the annual report?Week 4 discussionBudgeting Case Study (graded)Let’s start the week by reviewing the following case. First, let’s discuss how the budgeting process as employed by Springfield contributes to the failure to achieve the president’s sales and profit targets..next.ecollege.com/ec/courses/57464/CRS-AC505-4704647/Documents/BudgetingCase_Study.docx”>Click here to view the fileExam Review (graded)To begin, download the practice Midterm Exam from Doc Sharing to access questions and topics for review. For multiple-choice questions, please explain why the answer chosen is correct, and why the other choices would not be correct. Please support your response. Let’s begin with the questions on PageWeek 5 discussionStandards, Variances, Flexible Budgets (graded)To begin, please read Case 10B-5 on page 471, Ethics and the Manager. How were the standard costs developed? Are the standards set too high or too low? Please elaborate.Research and Application (graded)Let’s look at Case 9-26, Ethics and the Manager, in Chapter 9, page 414, and address and discuss the question there.Week 6 discussionSegment Reporting and Relevant Costs (graded)To begin, please read Case 12-32 on page 576. Which costs are relevant in the decision to shut down the Ashton facility? Then, letâs answer the questions at the end of the case. Also, value-added comments, points, and experiences are welcome and encouraged.Research and Application (graded)To begin, please read Problem 11-22 on page 505 of the e-book and let’s discuss the first question! Value-added comments, points, and experiences are also welcomed and encouraged.Week 7 discussionCapital Budgeting (graded)Welcome to Week 7 Discussions! Let’s begin by discussing the difference between capital budgeting screening decisions and capital budgeting preference decisions. Then, we will entertain additional questions relating to important capital budgeting terms, concepts, tools, methods, etc.Value-added, comments, points, observations, and experiences are welcomed and encouraged.Exam Review (graded)To begin, download the Practice Final Exam from Doc Sharing to access questions and topics for review. For multiple-choice questions, please explain why the answer chosen is correct and why the other choices would not be correct. Please support your response. Let’s begin with the questions on page 1.This section lists options that can be used to view responses.TCO F) Computing unit product costs involves averaging in:Job-Order CostingProcess CostingAYesNoBYesYesCNoYesDNoNoChoice A.Choice B.Choice C.Choice D.Question 2. Question :(TCO F) Process costing would be appropriate for each of the following except:custom furniture manufacturing.oil refining.grain milling.newsprint production.Question 3. Question :(TCO F) Assume there was no beginning work in process inventory and the ending work in process inventory is 70% complete with respect to conversion costs. Under the weighted-average method, the number of equivalent units of production with respect to conversion costs would be:the same as the units completed.less than the units completed.the same as the units started during the period.less than the units started during the period.:Question 4. Question :(TCO F) Which of the following accounts is debited when direct labor is recorded?Work in processSalaries and wages expenseSalaries and wages payableManufacturing overheadQuestion 5. Question :(TCO F) Stickles Corporation incurred $79,000 of actual Manufacturing Overhead costs during August. During the same period, the Manufacturing Overhead applied to Work in Process was $75,000. The journal entry to record the incurrence of the actual Manufacturing Overhead costs would include a:debit to Manufacturing Overhead of $79,000.credit to Manufacturing Overhead of $79,000.credit to Work in Process of $75,000.Question 6. Question :(TCO F) Wedd Corporation had $35,000 of raw materials on hand on May 1. During the month, the company purchased an additional $68,000 of raw materials. During May, $92,000 of raw materials were requisitioned from the storeroom for use in production. These raw materials included both direct and indirect materials. The indirect materials totaled $5,000. The debits to the Work in Process account as a consequence of the raw materials transactions in May total:$92,000.$0.$68,000.$87,000.(TCO F) Some companies use process costing and some use job-order costing. Which method a company uses depends on its industry. A number of companies in different industries are listed below:i. Specialty coffee roaster (roasts small batches of specialty coffee beans)ii. Custom aircraft builderiii. Brick manufactureriv. Microbrewery that produces a number of different beersv. Steel company making chain link fences from iron oreFor each company, indicate whether the company is most likely to use job-order costing or process costing.Question 2. Question :(TCO F) Job 728 was recently completed. The following data have been recorded on its job cost sheet:Direct materials$81,000Direct labor hours1,220 labor hoursDirect labor wage rate$15 per labor-hourMachine Hours1,520 machine hoursNumber of units completed4,400 unitsThe company applies manufacturing overhead on the basis of machine-hours. The predetermined overhead rate is $16 per machine-hour.Compute the unit product cost that would appear on the job cost sheet for this job.Question 3. Question :(TCO F) Harmon Company uses the weighted-average method in its process costing system. The Curing Department of Harmon Company reported the following information for the month of November.Units Percentage complete with respect to conversionWork in process, November 1 10,000 80%Units started 28,000Completed and transferred out 30,000Work in process, November 30 8,000 30%Costs for November Materials ConversionWork in process, November 1 $34,500 $48,600Added during the month $146,000 $194,400All materials are added at the beginning of the process.Required: Compute the following items using the weighted-average method:i. The equivalent units of production for materials.ii. The cost per equivalent unit for conversion.iii. The total cost assigned to units transferred out of the Curing Department during November.iv. The cost assigned to work in process inventory as of November 30.Question 4. Question :(TCO F) Honeysuckle Corporation has provided the following data for the month of January:InventoriesBeginningEndingRaw materials$40,000$23,000Work In process$9,000$13,000Finished goods$52,000$45,000Additional InformationRaw material purchases$68,000Direct labor costs$90,000Manufacturing overhead cost incurred$44,000Indirect materials included in manufacturing overhead costs incurred$8,000Manufacturing overhead cost applied to work in process$39,000Prepare a Schedule of Cost of Goods Manufactured and a Schedule of Cost of Goods Sold in good form.Case StudyCase Study 1:Springfield Express is due this week. Please see the instructions and guidance document located in Doc Sharing under the Case Study Files in the dropdown menu.Submit your assignment to the Dropbox located on the silver tab at the top of this page. For instructions on how to use the Dropbox,(TCO A) The following data (in thousands of dollars) have been taken from the accounting records of Larden Corporation for the just-completed year.Sales$950Purchases of raw materials$170Direct labor$210Manufacturing overhead$220Administrative expenses$180Selling expenses$140Raw materials inventory, beginning$70Raw materials inventory, ending$80Work-in-process inventory, beginning$30Work-in-process inventory, ending$20Finished goods inventory, beginning$100Finished goods inventory, ending$70Required: Prepare a Schedule of Cost of Goods Manufactured statement in the text box below.Question 2. Question :(TCO F) The Indiana Company manufactures a product that goes through three processing departments. Information relating to activity in the first department during June is given below.Percentage completedUnits Materials ConversionWork in process, June 1 70,000 65% 45%Work in process, Jun 30 60,000 75% 65%The department started 290,000 units into production during the month and transferred 300,000 completed units to the next department.Required: Compute the equivalent units of production for the first department for June, assuming that the company uses the weighted-average method of accounting for units and costs.:Question 3. Question :(TCO B) A tile manufacturer has supplied the following data:Boxes of tile produced and sold 625,000Sales revenue $2,975,000Variable manufacturing expense $1,720,000Fixed manufacturing expense $790,000Variable selling and admin expense $152,000Fixed selling and admin expense $133,000Net operating income $180,000Required:a. Calculate the company’s unit contribution margin.b. Calculate the company’s contribution margin ratio.c. If the company increases its unit sales volume by 5% without increasing its fixed expenses, what would the company’s net operating income be?Question 4. Question :(TCO E) Lehne Company, which has only one product, has provided the following data concerning its most recent month of operations:Selling price$ 125Units in beginning inventory600Units oroduced3000Units sold3500Units in ending inventory100Variable costs per unit:Direct materials$ 15Direct labor$ 50Variable manufacturing overhead$ 8Variable selling and admin$ 12Fixed costs:Fixed manufacturing overhead$ 75,000Fixed selling and admin$ 20,000The company produces the same number of units every month, although the sales in units vary from month to month. The company’s variable costs per unit and total fixed costs have been constant from month to month.Required:a. What is the unit product cost for the month under variable costing?b. What is the unit product cost for the month under absorption costing?c. Prepare an income statement for the month using the variable costing method.d. Prepare an income statement for the month using the absorption costing method.Time (US & Canada)(TCO A) The variable portion of advertising costs is aConversion YES… Period NO.Conversion YES …. Period YES.Conversion NO…. Period YES.Conversion NO…. Period NO.Question 2. Question :(TCO A) The costs of staffing and operating the accounting department at Central Hospital would be considered by the Department of Surgery to bedirect costs.sunk costs.incremental costs.None of the aboveQuestion 3. Question :(TCO A) Property taxes on a company’s factory building would be classified as a(n)sunk cost.opportunity cost.period cost.variable cost.manufacturing cost.:Question 4. Question :(TCO A) When the activity level is expected to increase within the relevant range, what effects would be anticipated with respect to each of the following?Fixed cost per unit Variable cost per unitIncrease No changeIncrease IncreaseDecrease No changeNo change IncreaseQuestion 5. Question :(TCO F) Which of the following statements is true?I. Overhead application may be made slowly as a job is worked on.II. Overhead application may be made in a single application at the time of completion of the job.III. Overhead application should be made to any job not completed at year end in order to properly value the work in process inventory.Only statement I is true.Only statement II is true.Both statements I and II are true.Statements I, II, and III are all true.Question 6. Question :(TCO F) Under a job-order costing system, the product being manufacturedis homogeneous.passes from one manufacturing department to the next before being completed.can be custom manufactured.has a unit cost that is easy to calculate by dividing total production costs by the units produced.Question 7. Question :(TCO F) Equivalent units for a process costing system using the FIFO method would be equal to: units completed during the period, plus equivalent units in the ending work-in-process inventory.units started and completed during the period, plus equivalent units in the ending work-in-process inventory.units completed during the period and transferred out.units started and completed during the period, plus equivalent units in the ending work-in-process inventory, plus work needed to complete units in the beginning work-in-process inventory.Question 8. Question :(TCO B) The contribution margin equalssales – expenses.sales – cost of goods sold.sales – variable costs.sales – fixed costs.Question 9. Question :(TCO B) To obtain the break-even point in terms of dollar sales, total fixed expenses are divided by which of the following?Variable expense per unitVariable expense per unit/Selling price per unitFixed expense per unit(Selling price per unit – Variable expense per unit) /Selling price per unit.Question 10. Question :(TCO E) Under variable costingnet operating income will tend to move up and down in response to changes in levels of production.inventory costs will be lower than under absorption costing.net operating income will tend to vary inversely with production changes.Course ProjectCourse Project Part A is due this week. Please see the instructions in the Course Project item under Course Home, as well as the Excel spreadsheet located in Doc Sharing. Also, please visit the related discussion area in Week 5.Submit your assignment to the Dropbox located on the silver tab at the top of this page(TCO D) A company that has a profit can increase its return on investment byincreasing sales revenue and operating expenses by the same dollar amount.increasing average operating assets and operating expenses by the same dollar amount.increasing sales revenue and operating expenses by the same percentage.decreasing average operating assets and sales by the same percentage.Question 2. Question :(TCO D) Given the following data, what would ROI be?Sales $50,000Net operating income $5,000Contribution margin $20,000Average operating assets $25,000Stockholder’s equity $15,000: 10%20%16.7%Question 3. Question :(TCO D) Last year, the House of Orange had sales of $826,650, net operating income of $81,000, and operating assets of $84,000 at the beginning of the year and $90,000 at the end of the year. What was the company’s turnover, rounded to the nearest tenth?9.510.29.8TCO D) Seebach Corporation has two major business segmentsâApparel and Accessories. Data concerning those segments for June appear below.Sales revenues, Apparel$700,000Variable expenses, Apparel$406,000Traceable fixed expenses, Apparel$98,000Sales revenues, Accessories$710,000Variable expenses, Accessories$312,000Traceable fixed expenses, Accessories$107,000Common fixed expenses totaled $292,000 and were allocated as follows: $155,000 to the Apparel business segment and $137,000 to the Accessories business segment.Required:Prepare a segmented income statement in the contribution format for the company. Omit percentages; show only dollar amounts.Question 2. Question :(TCO D) Eber Wares is a division of a major corporation. The following data are for the latest year of operations.Sales $30,000,000Net Operating income $1,170,000Average operating assets $8,000,000The company’s minimum required rate of return 18%Required:i. What is the division’s margin?ii. What is the division’s turnover?iii. What is the division’s ROI?iv. What is the division’s residual income?Question 3. Question :(TCO D) Tjelmeland Corporation is considering dropping product S85U. Data from the company’s accounting system appear below.Sales $360,000Variable Expenses $158,000Fixed Manufacturing Expenses $119,000Fixed Selling and Administrative Expenses $94,000All fixed expenses of the company are fully allocated to products in the company’s accounting system. Further investigation has revealed that $55,000 of the fixed manufacturing expenses and $71,000 of the fixed selling and administrative expenses are avoidable if product S85U is discontinued.Required:i. According to the company’s accounting system, what is the net operating income earned by product S85U? Show your work!ii. What would be the effect on the company’s overall net operating income of dropping product S85U? Should the product be dropped? Show your work!Question 4. Question :(TCO D) Part F77 is used in one of Wilcutt Corporation’s products. The company’s Accounting Department reports the following costs of producing the 7,000 units of the part that are needed every year.Per UnitDirect Materials $7.00Direct Labor $6.00Variable Overhead $5.60Supervisor’s Salary $4.70Depreciation of Special Equipment $1.50Allocated General Overhead $5.40An outside supplier has offered to make the part and sell it to the company for $28.30 each. If this offer is accepted, the supervisor’s salary and all of the variable costs, including direct labor, can be avoided. The special equipment used to make the part was purchased many years ago and has no salvage value or other use. The allocated general overhead represents fixed costs of the entire company. If the outside supplier’s offer were accepted, only $9,000 of these allocated general overhead costs would be avoided.Required:i. Prepare a report that shows the effect on the company’s total net operating income of buying part F77 from the supplier rather than continuing to make it inside the company.ii. Which alternative should the company choose?Question 5. Question :(TCO D) A customer has asked Clougherty Corporation to supply 4,000 units of product M97, with some modifications, for $40.10 each. The normal selling price of this product is $48.00 each. The normal unit product cost of product M97 is computed as follows.Direct Materials $18.50Direct Labor $1.20Variable manufacturing overhead $8.40Fixed manufacturing overhead $3.90Unit product cost $32.00Direct labor is a variable cost. The special order would have no effect on the company’s total fixed manufacturing overhead costs. The customer would like some modifications made to product M97 that would increase the variable costs by $5.70 per unit and that would require a one-time investment of $31,000 in special molds that would have no salvage value. This special order would have no effect on the company’s other sales. The company has ample spare capacity for producing the special order.Required:Determine the effect on the company’s total net operating income of accepting the special order. Show your work!Course ProjectYou should begin your Course Project Part B. Please see the document “Project B Instructions” in Doc Sharing for further information.Also, see the discussion area in Week 7.Submit your assignment to the Dropbox located on the silver tab at the top of this page.
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