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ACCT 556 Week 1 Homework Problems For more course tutorials visit

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The new president of the Wernecke Company was stumped. Why had profits gone down? He had directed the sales department to push the product with the highest contribution margin, and the sales department had come through with flying colors. The percent of flams sold had increased from 25% of units sold to 37.5% of units sold. So what happened? Required: 1. Calculate the Wernecke Company’s estimated direct labor hours to produce flims and flams. 2. Calculate the predetermined variable overhead rate that will be used in the coming year using a traditional costing system based upon direct labor hours. 3. Using a traditional costing system based upon direct labor hours, compute the unit product costs for flims and flams as well as contribution margin per unit. 4. It has been suggested to the president to consider the use of an ABC costing system to allocate manufacturing overhead. Engineering


studies have revealed the following information about estimated manufacturing activities for the coming year. Calculate the separate predetermined overhead rates for each of the activities listed above. 5. The following data is available about the activity levels needed to produce the projected 25,000 units of Flims: 6. The following data is available about the activity levels needed to produce the projected 15,000 units of Flams:

Calculate the expected variable overhead to be applied to Flams.

7. Calculate the total overhead (total for company) that is expected to be applied to Flims and Flams. 8. Calculate the projected unit costs and unit contribution margins for Flims and Flams using ABC costing. ************************************************************

ACCT 556 Week 2 Homework Assignment For more course tutorials visit

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The Schonlind Company has gathered information regarding past sales: Required: 1. Predict the sales for 2006 using the moving average method. 2. You noticed a sudden jump in sales in 2002. After inquiring about this jump, you were told that there was a one-time sale for $200,000 in that year that is not likely to be repeated. What revision, if any, would you make in the sales information used for projection? 3. If you revised you historical sales to be used to project 2006 sales, recalculate your projection using the moving average method. 4. Which projection (question 1 or question 3) do you feel is more representative of the Schonlind Company’s historical sales? Why? Please complete the remaining questions using the revised historical data. 5. Predict the sales for 2006 using exponential smoothing. 6. Predict the sales for 2006 using a trend line technique using. (GROWTH function in Excel). 7. Predict the sales for 2006 using a graphing technique. 8. It has been suggested that sales for the company may be connected to disposal income. Using the information below regarding historical disposable income, predict the sale for 2006 using regression analysis if a reliable prediction for disposable income for 2006 is $35,430. 9. Which method do you think provides the most realistic sales projections for 2006? Why? ************************************************************


ACCT 556 Week 3 Homework Problems For more course tutorials visit

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Production Budgets The Hale Company finished their sales projections for the coming year. The company produces one product. Part of next year’s sales projections are as follows: Engineering has developed the following standards upon which the production budgets will be developed: Item

Standard

Materials usage

5 lbs per unit

Material price per pound

$1.50 per pound

Labor usage

0.4 hours per unit

Labor rate

$30 per hour

Machine hours 3 machine hours per unit


The Hale Company uses a modified allocation method for allocating overhead costs. The rates that will be used in the coming year are as follows: Required: Prepare the following production budgets for July, August, and September for the Hale Company: 1. Production budget 2. Materials purchase budget 3. Direct labor budget 4. Overhead budget For the quarter (quarter totals only), prepare the: 5. Cost of goods manufactured budget ************************************************************

ACCT 556 Week 4 Homework Problems For more course tutorials visit

www.tutorialrank.com Week 4 Capital Budgeting Practice problem:

You have the following data about a proposed project:


Cost of new equipment

$80,000

Increase need for Working Capital (to be released at end of project) $20,000 Length of project

6

years

Salvage Value of equipment at end of project

$8,000

Annual cash savings if equipment is purchased (cash inflows) $28,500 Tax rate

35%

Discount rate required of all investements

14%

Required: 1. What is the annual accounting income? 2. What is the annual after tax cash flow? 3. What is the payback based upon the initial cash outflows? 4. What is the discounted payback based on the initial cash outflows? 5. What is the simple rate of return based upon the initial cash outflows? 6. What is the net present value? 7. What is the net present value 8. What is the internal rate of return 9. Would you recommend this project? Why or why not. ************************************************************


ACCT 556 Week 5 Homework Assignment For more course tutorials visit

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Week 5 Problem Cash Budget Note: It is expected that this problem will be complete using an Excel spreadsheet using formulas. Please see the Excel Tutorial that is available under the course home tab. The Hale Company is currently working on its cash budget for the coming year. The following information is available:

Projected sales for the coming year:

The collection history of the Hale Company has been as follows 20% of sales are collected in the month of the sale. 60% of the sales are collected in the month following the sale. 12% of the sales are collected in the 2nd month following the sale. 5% of the sales are collected in the 3rd month following the sale.


The following information regarding costs is available: The cost of goods sold is 54% of sales Items for sale are purchased in the month of the sale. 80% of accounts payable are paid in the month following when the cost is incurred. 20% of accounts payable are paid in the 2nd month following when the cost is incurred. Wages are 28% of sales and are paid currently Annual general and administrative costs are $1,411,200 and are incurred evenly throughout the year. Annual property taxes are $14,000 and are paid semi annually in June and October. A $10,000 cash capital purchase will be made in April. The beginning cash balance in April is expected to be $47,000. The Hale Company has a policy of maintaining a minimum cash balance of $45,000. The company has an arrangement with a local bank for a line of credit that carries a 10% annual interest rate. If the ending monthly balance falls below $45,000, the company will borrow against the line of credit so that the minimum balance can be maintained. If the company has borrowed against the line of credit and a cash balance is expected to be above $45,000 at the end of a particular month, then repayments will be made bringing the cash balance down to $45,000. Interest on the line of credit is paid monthly. Assume that all line of credit transactions occur on the last day of the month. Required:


Prepare a cash budget for the Hale Company for the 2nd quarter of the year. Include April, May, June, and a quarter total in your budget. ************************************************************

ACCT 556 Week 6 Homework Problem For more course tutorials visit

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Week 6 Problem Proforma Statements The Duncan Company has just completed a number of budgets for the coming year. The cost of goods manufactured schedule, the proforma income statement and the balance sheet still have to be completed. The following information is available: Information from recent budgets for the coming year: 1. Projected sales are $1,800,000 (12,690 units) 2. Projected direct material purchases are $500,000 3. Projected direct material usage is $495,000 4. Projected direct labor expense is $400,000


5. Projected overhead is $380,000 6. Projected selling expenses are $120,000 7. Projected administrative expenses are $300,000 8. Projected cash collections are $1,785,000 9. Projected payments for materials (accounts payable) are $520,000 10. Projected payments for other operating expenses (other current liabilities) are $1,130,000 11. Projected depreciation expense is $55,000 and is already included in mfg overhead Additional information that is available: 1. The expected tax rate is 35% 2. The company is planning a stock issue of $25,000 3. Income taxes are paid 3 months after the year-end 4. The company anticipates purchasing a new patent for $10,000 during the year. 5. WIP inventory is expected to decrease by $2,000 6. Finished goods inventory is expected to increase by $8,000 7. Due to insurance rate increases, it is expected that prepaid expenses will increase by $3,000 Investment information: 1. A purchase of additional equipment for $75,000 is expected on January 1st.


2. The purchase will be made using $50,000 cash and long-term debt will be increased by $25,000 Long-Term Debt information: 1. All long-term debt will have an 8% annual rate. 2. A payment of $50,000 including BOTH principle and interest will be made on December 31st. Required: Prepare a cost of goods manufactured schedule, a proforma income statement and proforma balance sheet. ************************************************************

ACCT 556 Week 7 Course Project (Fanciful Inc) For more course tutorials visit

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ACCT 556 Week 7 Course Project Fantastic Inc For more course tutorials visit

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ACCT 556 Inspiring Innovation- tutorialrank.com  

For more course tutorials visit www.tutorialrank.com ACCT 556 Week 1 Homework The new president of the Wernecke Company was stumped. Why h...

ACCT 556 Inspiring Innovation- tutorialrank.com  

For more course tutorials visit www.tutorialrank.com ACCT 556 Week 1 Homework The new president of the Wernecke Company was stumped. Why h...

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