Prepare an income statement for the current year

Assignment Help Financial Accounting

Reference no: EM13180477

1. Product costs and period costs

The costs that follow were extracted from the accounting records of several different manufacturers:

1. Weekly wages of an equipment maintenance worker

2. Marketing costs of a soft drink bottler

3. Cost of sheet metal in a Honda automobile

4. Cost of president's subscription to Fortune magazine

5. Monthly operating costs of pollution control equipment used in a steel mill

6. Weekly wages of a seamstress employed by a jeans maker

7. Cost of compact discs (CDs) for newly recorded releases of Rush, Billy Joel, and Bryan Adams

a. Determine which of these costs are product costs and which are period costs.

b. For the product costs only, determine those that are easily traced to the finished product and those that are not.

2. Definitions of manufacturing concepts
Interstate Manufacturing produces brass fasteners and incurred the following costs for the year just ended:

Materials and supplies used

Brass $75,000

Repair parts 16,000

Machine lubricants 9,000

Wages and salaries Machine operators 128,000

Production supervisors 64,000

Maintenance personnel 41,000

Other factory overhead Variable 35,000

Fixed 46,000

Sales commissions 20,000

Compute:

a. Total direct materials consumed

b. Total direct labor

c. Total prime cost

d. Total conversion cost

3. Schedule of cost of goods manufactured, income statement

The following information was taken from the ledger of Jefferson Industries, Inc.:

Direct labor	$85,000	Administrative expenses	$59,000
Selling expenses	34,000	Work in. process
Sales	300,000	Jan. 1	29,000
Finished goods		Dec. 31	21,000
Jan. 1	115,000	Direct material purchases	88,000
Dec. 31	131,000	Depreciation: factory	18,000
Raw (direct) materials on hand		Indirect materials used	10,000
Jan. 1	31,000	Indirect labor	24,000
Dec. 31	40,000	Factory taxes	8,000
		Factory utilities	11,000

Prepare the following:

a. A schedule of cost of goods manufactured for the year ended December 31.

b. An income statement for the year ended December 31.

3. Manufacturing statements and cost behavior

Tampa Foundry began operations during the current year, manufacturing various products for industrial use. One such product is light-gauge aluminum, which the company sells for $36 per roll. Cost information for the year just ended follows.

Per Unit	Variable Cost	Fixed Cost
Direct materials	$4.50	$ -
Direct labor	6.5	-
Factory overhead	9	50,000
Selling	-	70,000
Administrative	-	135,000

Production and sales totaled 20,000 rolls and 17,000 rolls, respectively There is no work in process. Tampa carries its finished goods inventory at the average unit cost of production.

Instructions:

a. Determine the cost of the finished goods inventory of light-gauge aluminum.

b. Prepare an income statement for the current year ended December 31

c. On the basis of the information presented:

1. Does it appear that the company pays commissions to its sales staff? Explain.

2. What is the likely effect on the $4.50 unit cost of direct materials if next year's production increases? Why?

Reference no: EM13180477

Questions Cloud

Write an equation for the curve : For each of the described curves, decide if the curve would be more easily given by a polar equation or a Cartesian equation. Then write an equation for the curve.

What are the second cycle changes in spending : Suppose that investment demand increases by $100. Assume that households have a marginal propensity to consume of 80 percent. Compute the first three rounds of multiplier effects as follows: a) What are the first cycle changes in spending? Total cu..

Determine the smallest integer ration : find the wt percent of C and H. find the smallest integer ration of C:H in the compound

Is not there a search box : why can't I search by subject instead of school? I just want some precalc study resources for my daughter, who is in high school. The organization of this site makes no sense. Isn't there a search box??

Prepare an income statement for the current year : Determine the cost of the finished goods inventory of light-gauge aluminum and prepare an income statement for the current year ended December 31

What is the cumulative depreciation : Your company has purchased a large ne truck for over thr road use(asset class 0.26).it has s cost basis of $180,000.With additional options costing $15,000,the cost basis for depreciation purposes is $195,000.its ,MV at th end if five years is est..

Stops both incoming sunlight and outgoing infrared radiation : What is the major role of a greenhouse gas that contributes to temperature rise of the Earth's surface? 1 Stops both incoming sunlight and outgoing infrared radiation

Find out the name of unknown organic compound : Using the following spectral information, determine the name of unknown organic compound A. For full credit, explain why/how the spectral information led you to your answer.

What price would the total expenditure on coffee be largest : Suppose the daily demand for coffee in Seattle is Q^d=100,000(3-P)^2 A. What is the elasticity of demand (Ed) at a price of $2.(Please show exactly which equation is needed to find Ed here) B. At what price would the total expenditure on coffee be la..

User Account

All Pages