Chapter 3 - Homework
During the most recent year, Beyta Company had the following data: *Same Numbers as Above* -Units in beginning inventory: — -Units produced: 10,000 -Units sold ($60 per unit): 8,800 Variable costs per unit: -Direct materials: $12 -Direct labor: $7 -Variable overhead: $5 Fixed costs: -Fixed overhead per unit produced: $8 -Fixed selling and administrative: $138,000 1. Calculate the cost of goods sold under absorption costing. 2. Prepare an income statement using absorption costing.
Absorption-Costing Income Statement
During the most recent year, Osterman Company had the following data: -Units in beginning inventory: — -Units produced: 10,000 -Units sold ($47 per unit): 9,300 Variable costs per unit: -Direct materials: $9 -Direct labor: $6 -Variable overhead: $4 Fixed costs: -Fixed overhead per unit produced: $5 -Fixed selling and administrative: $138,000 1. Calculate the cost of goods sold under absorption costing. 2. Prepare an income statement using absorption costing. Enter amounts as positive numbers.
Absorption-Costing Income Statement 1. $223,200 2. Sterman Company - Income Statement under Absorption Costing - For the Most Recent Year: -Sales: $437,100 -Less: COGS: $223,200 -Gross Margin: $213,900 -Less: Selling and Admin Expense: $138,000 -Operating Income: $75,900
Kleenaire Motors manufactures hybrid sports utility vehicles (SUVs). Kleenaire incurs monthly depreciation costs of $10,000,000 on its highly automated plant machinery and warehousing facility. Also, each SUV requires materials and manufacturing overhead resources. On average, the company uses 75,000,000 pounds of steel to manufacture 50,000 SUVs per month. Each pound of steel costs $0.20. In addition, manufacturing overhead resources are driven by machine hours. On average, the company incurs $200,000,000 of variable manufacturing overhead resources to produce 50,000 SUVs per month. 1. Create a formula for the monthly cost of SUVs for Kleenaire. Total Cost of SUVs = ________ + ( ________ x Number of SUVs) Total Cost of SUVs = ________ + ( ________ × Number of SUVs) 2. If Kleenaire expects to manufacture 55,000 SUVs next month, what is the expected fixed cost (assuming that 55,000 units is within the company's current relevant range)? What is the total variable cost (assuming that 55,000 units is within the company's current relevant range)? What is the total manufacturing cost (i.e., both fixed and variable) (assuming that 55,000 units is within the company's current relevant range)?
Creating and Using a Cost Formula 1. Fixed Cost; Variable Rate -$10,000,000; $4,300 2. $236,500,000 3. $246,500,000
Big Thumbs Company manufactures portable flash drives for computers. Big Thumbs incurs monthly depreciation costs of $15,000 on its plant equipment. Also, each drive requires materials and manufacturing overhead resources. On average, the company uses 10,000 ounces of materials to manufacture 5,000 flash drives per month. Each ounce of material costs $3.00. In addition, manufacturing overhead resources are driven by machine hours. On average, the company incurs $22,500 of variable manufacturing overhead resources to produce 5,000 flash drives per month. In your calculations, round variable rate per flash drive to the nearest cent. 1. Create a formula for the monthly cost of flash drives for Big Thumbs. Total cost of flash drives = ________ + ( ________ x Number of flash drives) Total cost of flash drives = ________ + ( ________ x Number of flash drives) 2. If the department expects to manufacture 6,000 flash drives next month, what is the expected fixed cost (assume that 6,000 units is within the company's current relevant range)? 3. What is the total variable cost (assume that 6,000 units is within the company's current relevant range)? 4. What is the total manufacturing cost (i.e., both fixed and variable) (assume that 6,000 units is within the company's current relevant range)?
Creating and Using a Cost Formula: 1. Fixed Cost; Variable Rate $15,000; $10.50 2. $15,000 3. $63,000 4. $78,000
During the most recent year, Judson Company had the following data associated with the product it makes: -Units in beginning inventory: 300 -Units produced: 15,000 -Units sold ($300 per unit): 12,700 Variable costs per unit: -Direct materials: $20 -Direct labor: $60 -Variable overhead: $12 Fixed costs: -Fixed overhead per unit produced: $30 -Fixed selling and administrative: $140,000 1. How many units are in ending inventory? 2. Using absorption costing, calculate the per-unit product cost. 3. What is the value of ending inventory under absorption costing?
Inventory Valuation under Absorption Costing 1. 2,600 units 2. $122 per unit 3. $317,200
During the most recent year, Pelham Company had the following data associated with the product it makes: *Same Numbers as Above* 1. How many units are in ending inventory? 2. Using variable costing, calculate the per-unit product cost. 3. What is the value of ending inventory under variable costing?
Inventory Valuation under Variable Costing
During the most recent year, Judson Company had the following data associated with the product it makes: *Same Numbers as Above* 1. How many units are in ending inventory? 2. Using variable costing, calculate the per-unit product cost. 3. What is the value of ending inventory under variable costing?
Inventory Valuation under Variable Costing 1. 2,600 units 2. $92 per unit 3. $239,200
Speedy Pete's is a small start-up company that delivers high-end coffee drinks to large metropolitan office buildings via a cutting-edge motorized coffee cart to compete with other premium coffee shops. Data for the past 8 months were collected as follows: *Same Numbers as Above* Assume that this information was used to construct the following formula for monthly delivery cost. Total Delivery Cost = $41,850 + ($12.00 × Number of Deliveries) Assume that 3,000 deliveries are budgeted each month for the coming year. Use the total delivery cost formula to make the following calculations: 1. Calculate total variable delivery cost for the coming year. 2. Calculate total fixed delivery cost for the year. 3. Calculate total delivery cost for the year.
Using High-Low to Calculate Fixed Cost, Calculate the Variable Rate, and Construct a Cost Function 1. $432,000 2. $502,200 3. $934,200
Pizza Vesuvio makes specialty pizzas. Data for the past 8 months were collected: Month Labor Cost Employee Hours ------------------------------------------------------- January $7,000 360 February $8,140 550 March $9,899 630 April $9,787 610 May $8,490 480 June $7,450 350 July $9,490 570 August $7,531 310 Pizza Vesuvio's controller wants to calculate the fixed and variable costs associated with labor used in the restaurant. In your calculations, round the variable rate per employee hour to the nearest cent. Required: 1. Using the high-low method, calculate the variable rate. 2. Using the high-low method, calculate the fixed cost of labor. 3. Using the high-low method, construct the cost formula for total labor cost. Total labor cost = ________ + [ ________ × Employee hours]
Using High-Low to Calculate Fixed Cost, Variable Rate, and Construct a Cost Function 1. $7.40 per hour 2. $5,237 3. $5,237; $7.40
Pizza Vesuvio makes specialty pizzas. Data for the past eight months were collected: *Same Numbers as Above* Total Labor Cost = $5,237 + ($7.40 x Employee Hours) Assume that 675 employee hours are budgeted for the month of September. Use the total labor cost formula for the following calculations: 1. Calculate total variable labor cost for September. 2. Calculate total labor cost for September.
Using High-Low to Calculate Predicted Total Variable Cost and Total Cost for Budgeted Output 1. $4,995 2. $10,232
Speedy Pete's is a small start-up company that delivers high-end coffee drinks to large metropolitan office buildings via a cutting-edge motorized coffee cart to compete with other premium coffee shops. Data for the past 8 months were collected as follows: Month; Delivery Cost; Number of Deliveries -May: $63,450; 1,800 -June: $67,120; 2,010 -July: $66,990; 2,175 -August: $68,020; 2,200 -September: $73,400; 2,550 -October: $72,850; 2,630 -November: $75,450; 2,800 -December: $73,300; 2,725 Speedy Pete's controller wants to calculate the fixed and variable costs associated with its cutting-edge delivery service. 1. Using the high-low method, calculate the fixed cost of deliveries. 2. Using the high-low method, calculate the variable rate per delivery. 3. Using the high-low method, construct the cost formula for total delivery cost. Total Delivery Cost = ________ + ( ________ × Number of Deliveries)
Using High-Low to Calculate Predicted Total Variable Cost and Total Cost for Budgeted Output 1. $41,850 2. $12 3. Total Delivery Cost = $41,850 + ($12 x Number of Deliveries)
Pizza Vesuvio makes specialty pizzas. Data for the past eight months were collected: *Same Numbers as Above* Total Labor Cost = $5,237 + ($7.40 x Employee Hours) Assume that 4,000 employee hours are budgeted for the coming year. Use the total labor cost formula to make the following calculations: 1. Calculate total variable labor cost for the coming year. 2. Calculate total fixed labor cost for the coming year. 3. Calculate total labor cost for the coming year.
Using High-Low to Calculate Predicted Total Variable Cost and Total Cost for a Time Period that Differs from the Data Period 1. $29,600 2. $62,844 3. $92,444
Speedy Pete's is a small start-up company that delivers high-end coffee drinks to large metropolitan office buildings via a cutting-edge motorized coffee cart to compete with other premium coffee shops. Data for the past 8 months were collected as follows: *Same Numbers as Above* Speedy Pete's controller wants to calculate the fixed and variable costs associated with its cutting-edge delivery service. 1. Using the high-low method, calculate the fixed cost of deliveries. 2. Using the high-low method, calculate the variable rate per delivery.
Using High-Low to Calculate Predicted Total Variable Cost and Total Cost for a Time Period that Differs from the Data Period 1. $36,000 2. $77,850
Inventory Valuation under Variable Costing -Units in beginning inventory: 400 -Units produced: 14,000 -Units sold ($300 per unit): 13,700 Variable costs per unit: -Direct materials: $15 -Direct labor: $36 -Variable overhead: $9 Fixed costs: -Fixed overhead per unit produced: $40 -Fixed selling and administrative: $140,000 1. How many units are in ending inventory? 2. Using variable costing, calculate the per-unit product cost. 3. What is the value of ending inventory under absorption costing?
Using Regression to Calculate Fixed Cost, Calculate the Variable Rate, construct a Cost Formula, and Determine Budgeted Cost 1.
Pizza Vesuvio makes specialty pizzas. Data for the past eight months were collected: *Same Numbers as Above* Coefficients shown by a regression program for Pizza Vesuvio's data are: Intercept: 4,517 X Variable: 8.20 Use the results of regression to make the following calculations: 1. Calculate the fixed cost of labor. Calculate the variable rate per employee hour. 2. Construct the cost formula for total labor cost. Total labor cost = ________ + ( ________ × Employee hours) 3. Calculate the budgeted cost for next month, assuming that 675 employee hours are budgeted.
Using Regression to Calculate Fixed Cost, Calculate the Variable Rate, construct a Cost Formula, and Determine Budgeted Cost 1. $4,517; $8.20 2. $4,517; $8.20 3. $10,052
During the most recent year, Osterman Company had the following data: *Same Numbers as Above* 1. Calculate the cost of goods sold under variable costing. 2. Prepare an income statement using variable costing. Enter amounts as positive numbers.
Variable-Costing Income Statement 1. $176,700 2. Osterman Company - Income Statement under Variable Costing - For the Most Recent Year: -Sales: $437,100 -Less: Variable COGS: $178,700 -Contribution Margin: $260,400 Less: Fixed Expenses: -Fixed Overhead: $50,000 -Fixed Selling and Admin Expenses: $138,000 -> $188,000 -Operating Income: $72,400
During the most recent year, Beyta Company had the following data: -Units in beginning inventory: — -Units produced: 10,000 -Units sold ($60 per unit): 8,800 Variable costs per unit: -Direct materials: $12 -Direct labor: $7 -Variable overhead: $5 Fixed costs: -Fixed overhead per unit produced: $8 -Fixed selling and administrative: $138,000 1. Calculate the cost of goods sold under variable costing. 2. Prepare an income statement using variable costing.
Variable-Costing Income Statement 1. $211,200 2. Income Statement: -Sales: $528,000 -Less: Variable COGS: $211,200 -Contribution Margin: $316,800 Less: Fixed Expenses: -Fixed Overhead: $50,000 -Fixed Selling and Admin Expenses: $138,000 -> $218,000 -Operating Income: $72,400
