(Solved):Q: Paul Swanson has…

Question

Paul Swanson has an opportunity to acquire a franchise from The Yogurt Place, Inc., to dispense frozen yogurt products under The Yogurt Place name. Mr. Swanson has assembled the following information relating to the franchise:

  1. A suitable location in a large shopping mall can be rented for $3,500 per month.
  2. Remodeling and necessary equipment would cost $318,000. The equipment would have a 20-year life and a $15,900 salvage value. Straight-line depreciation would be used, and the salvage value would be considered in computing depreciation.
  3. Based on similar outlets elsewhere, Mr. Swanson estimates that sales would total $380,000 per year. Ingredients would cost 20% of sales.
  4. Operating costs would include $78,000 per year for salaries, $4,300 per year for insurance, and $35,000 per year for utilities. In addition, Mr. Swanson would have to pay a commission to The Yogurt Place, Inc., of 11.5% of sales.

Required:

1. Prepare a contribution format income statement that shows the expected net operating income each year from the franchise outlet.

2-a. Compute the simple rate of return promised by the outlet.

3-a. Compute the payback period on the outlet.

 

 

(Solved):Q: ) Grayson Compan…

Question

) Grayson Company is considering purchase of equipment that costs $49,000 and is expected to offer annual cash inflows of $13,000.

 

 

 

 

 

 

 

 

 

 

 

 

 

Grayson's minimum required rate of return is 10%. How many years must the cash flows last for the investment to be acceptable?

 

 

 

 

 

 

 

 

 

 

 

 

 

(Do not round your intermediate calculations. Round to nearest whole year.)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

A) 4

 

 

 

 

 

 

 

 

 

 

 

 

 

B) 5

 

 

 

 

 

 

 

 

 

 

 

 

 

C) 3

 

 

 

 

 

 

 

 

 

 

 

 

 

D) 6

 

 

 

 

 

 

 

 

 

 

 

 

 

(Solved):Q: For each separat…

Question

For each separate case, record the necessary adjusting entry.

a. On July 1, Lopez Company paid $1,200 for six months of insurance coverage. No adjustments have
been made to the Prepaid Insurance account, and it is now December 31. Prepare the year-end adjust-
ing entry to reflect expiration of the insurance as of December 31.
b. Zim Company has a Supplies account balance of $5,000 at the beginning of the year. During the year,
it purchases $2,000 of supplies. As of December 31, a physical count of supplies shows $800 of
supplies available. Prepare the adjusting journal entry to correctly report the balance of the Supplies
account and the Supplies Expense account as of December 31.

Image Transcription

a. On July 1, Lopez Company paid $1,200 for six months of insurance coverage. No adjustments have been made to the Prepaid Insurance account, and it is now December 31. Prepare the year-end adjust- ing entry to reflect expiration of the insurance as of December 31. b. Zim Company has a Supplies account balance of $5,000 at the beginning of the year. During the year, it purchases $2,000 of supplies. As of December 31, a physical count of supplies shows $800 of supplies available. Prepare the adjusting journal entry to correctly report the balance of the Supplies account and the Supplies Expense account as of December 31.

(Solved):Q: Equipment was pu…

Question
Equipment was purchased for $83700 on January 1, 2021. Freight charges amounted to $4000 and there was a cost of $12000 for building
a foundation and installing the equipment. It is estimated that the equipment will have a $16000 salvage value at the end of its 5-year
useful life. What is the amount of accumulated depreciation at December 31, 2022 if the straight-line method of depreciation is used?
O $16740.
O $13540.
O $28140.
$33480.

Image Transcription

Equipment was purchased for $83700 on January 1, 2021. Freight charges amounted to $4000 and there was a cost of $12000 for building a foundation and installing the equipment. It is estimated that the equipment will have a $16000 salvage value at the end of its 5-year useful life. What is the amount of accumulated depreciation at December 31, 2022 if the straight-line method of depreciation is used? O $16740. O $13540. O $28140. $33480.

(Solved):Q: Using the Balanc…

Question
Using the Balance Sheet of Al Salam Firm for the years of 2017.
Required:
 
  • Using Common Size Balance Sheet Method, Conduct Solvency Analysis of the Capital Structure Composition of the Liabilities and Equity for the years 2017.
  • Comment on the Capital Structure for the years 2017.
  • Comment of the highest and lowest components of the Capital Structure Composition for the year of 2017.

(Solved):Q: Kansas Supplies …

Question

Kansas Supplies is a manufacturer of plastic parts that uses the weighted-average process costing method to account for costs of production. It produces parts in three separate departments: Molding, Assembling, and Packaging. The following information was obtained for the Assembling Department for the month of April.

 

Work in process on April 1 had 113,000 units made up of the following.

 

  Amount Degree of Completion
Prior department costs transferred in from the Molding Department $ 160,460     100 %
Costs added by the Assembling Department            
Direct materials $ 101,700     100 %
Direct labor   45,681     70 %
Manufacturing overhead   24,192     50 %
  $ 171,573        
Work in process, April 1 $ 332,033        
 

 

During April, 513,000 units were transferred in from the Molding Department at a cost of $728,460. The Assembling Department added the following costs.

 

       
Direct materials $ 442,530  
Direct labor   216,849  
Manufacturing overhead   150,178  
Total costs added $ 809,557  
 

 

Assembling finished 413,000 units and transferred them to the Packaging Department.

 

At April 30, 213,000 units were still in work-in-process inventory. The degree of completion of work-in-process inventory at April 30 was as follows.

 

     
Direct materials 90 %
Direct labor 80  
Manufacturing overhead 40  
 

 

Required:

a. Prepare a production cost report using the weighted-average method. (Round "Cost per equivalent unit" to 2 decimal places.)

(Solved):Q: Cheetah Accessor…

Question

Cheetah Accessories uses four departments to produce handles for kitchen cabinets: Forming requires mixing the raw materials, Moulding, Spraying and Drying. After leaving the Drying Department, the handles are packaged and sent to the Finished Goods warehouse for shipment to retail outlets. The following data relates to the Spraying Department for the month of June:

During the month, 2,000 handles valued at $275 each were transferred from the Molding Department to the Spraying Department. Other production costs incurred during the month are summarized as follows: Direct Materials Added $171,000

Direct Manufacturing Wages $425,600

Manufacturing Overhead $205,200

Process inspection occurs during the process and normally no losses are expected at this stage. However, during the month 200 handles were rejected at inspection. Rejected units from this department are sold as scrap at $400 each. These units had reached the following degree of completion:

Transfer from Moulding 100%

Direct material added 80%

Conversion costs 50%

During June, 1,400 handles were completed, packaged and transferred to Finished Goods.

Work-in-progress at the end of June had reached the following degree of completion:

Transfer from Moulding 100%

Materials added 60%

Conversion costs 40%

Materials added and conversion costs are incurred uniformly throughout each process. There were no incomplete units in the Spraying Department at the beginning of the period.

Required: (a) Compute the equivalent units and cost per equivalent units for direct materials (From Moulding & Direct materials added) and conversion costs.

(b) Compute the: 

total cost of the handles completed and transferred out of the Drying Department 

cost of the unexpected losses 

cost of ending work in process inventory in the Spraying Department

(c) Post all transactions to the Work in Process Inventory – Spraying Department T-account. What is the ending balance? 

(d) Prepare the journal entries for the use of total direct materials, direct labour incurred, manufacturing overhead applied and the cost of the units completed and transferred out to the Drying Process.

(e) Given that 25% of the unexpected losses were as a result of pilferage, calculate Chrome Accessories true loss for the Spraying Department. 

(Solved):Q: Problem 4: Lal n…

Question
Problem 4: Lal
nformation of Hanes' direct labor costs for the month of May is as follows:
Actual direct labor rate
Standard direct labor hours allowed
Actual direct labor hours
Direct labor rate variance- favorable
P7.50
11,000
10,000
P5,500
Reguired: Compute the standard direct labor rate in effect for the month of
May.

Image Transcription

Problem 4: Lal nformation of Hanes' direct labor costs for the month of May is as follows: Actual direct labor rate Standard direct labor hours allowed Actual direct labor hours Direct labor rate variance- favorable P7.50 11,000 10,000 P5,500 Reguired: Compute the standard direct labor rate in effect for the month of May.

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