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Devry ACCT 346 All Weeks Homework Assignments

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Devry ACCT 346 All Weeks Homework Assignments Latest 2015


WEEK 1 TO 7
Question
ACCT346 Weekly Assignment
Week 1
Directions: Your assignment this week is to answer the four questions below. Please note
that Question 4 contains multiple parts. Please show your work for full credit on Questions
4b 4e.

1. Identify whether each of the items below is a Product Cost or Period Cost: (1/2 point
each, total 5 points)
Factory insurance Product
Interest on bank loan
Eggs, salt, water used for baking
Depreciation on bake ovens
Paper wrappers for bread
Delivery truck costs
Advertising costs
Factory supervisor salaries
Sales Commissions
Flour used in baking bread
2. Identify whether each of the items below is a Direct Cost or Indirect Cost: (1/2 point
each, total 5 points)
Factory insurance Indirect
Bakers wages
Eggs used for baking
Depreciation on bake ovens
Paper wrappers for bread
Cleaning materials for bake ovens

Utilities used in factory


Factory supervisor salaries
Small amount of salt used
Flour used in baking bread
3. Identify whether each of the below is a Fixed Cost or Variable Cost: (1/2 point each,
total 5 points)
Shipping costs for bread Variable
Cost of fuel for delivery truck
Factory rent
Factory insurance
Maintenance on delivery truck
Sales commissions
Hourly wages paid to bakers assistant
Oven depreciation
Cost of fruit for cake topping
Factory utilities
4. Classify each as direct material, direct labor, indirect labor, indirect labor, other
manufacturing overhead or period cost, and then answer the 5 questions below: 4a.
Classify each cost (the first one is done for you): (5 points total)
An airline manufacturer incurred the following costs last month (in thousands of dollars):
Direct Material Direct Labor Indirect Material Indirect Labor Other Manufacturing Overhead
Period Cost

1. Depreciation on forklifts
$60 $60
2. Property tax on corporate marketing office $30
3. Cost of warranty repairs .
$220
4. Factory janitors wages ..
$10
5. Cost of designing new plant layout . $190
6. Machine operators health insurance . $40
7. Airplane seats .
$270
8. Depreciation on administrative offices .. $70
9. Assembly workers wages .
$670
10. Plant utilities
$110
11. Production supervisors salaries .
$160
12. Jet engines
$1,100
13. Machine lubricants
$20
Then, answer the below questions:
4b. How much are total manufacturing overhead costs? (5 points)
4c. How much are total inventoriable product costs? (5 points)
4d. How much are total prime costs? (5 points)
4e. How much are total conversion costs? (5 points)
<pclass=msonormal style=color: rgb(0, 0, 0); font-family: Verdana, arial, sans-serif; fontsize: 12px; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing:
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0px;>DeVry University
ACCT346 Weekly Assignment
Week 2
Directions: Your assignment this week is to answer the three questions below. Please note
that Question #3 has 2 parts, Part A and Part B. Please show your work for full credit and
use the box provided. Please add more rows or columns to the box if needed.
1. Biltz Company uses a predetermined overhead rate based on direct labor hours to
allocate manufacturing overhead to jobs. During the year, the company actually
incurred manufacturing overhead costs of $582,000 and 135,000 direct labor hours
were worked. The company estimated that it would incur $525,000 of manufacturing
overhead during the year and that 150,000 direct labor hours would be worked.
By how much was manufacturing overhead overallocated or underallocated for the year?
2. The following account balances at the beginning of January were selected from the
general ledger of Ocean City Manufacturing Company:
Work-in-process inventory $0
Raw materials inventory $28,000
Finished goods inventory $40,000
Additional data:
1) Actual manufacturing overhead for January amounted to $62,000.
2) Total direct labor cost for January was $63,000.
3) The predetermined manufacturing overhead rate is based on direct labor cost. The
budget for the year called for $250,000 of direct labor cost and $350,000 of manufacturing
overhead costs.

4) The only job unfinished on January 31 was Job No. 151, for which total direct labor
charges were $5,200 (800 direct labor hours) and total direct material charges were
$14,000.
5) Cost of direct materials placed in production during January totaled $123,000. There
were no indirect material requisitions during January.
6) January 31 balance in raw materials inventory was $35,000.
7) Finished goods inventory balance on January 31 was $34,500.
What is the cost of goods manufactured for January? Show your work for full credit.
3. Vintage Fun reproduces old-fashioned style roller skates and skateboards. The
annual production and sales of roller skates is 950 units, while 1,750 skateboards
are produced and sold. The company has traditionally used direct labor hours to
allocate its overhead to products. Roller skates require 2.5 direct labor hours per unit,
while skateboards require 1.25 direct labor hours per unit. The total estimated
overhead for the period is $114,300. The company is looking at the possibility of
changing to an activity-based costing system for its products. If the company used an
activity-based costing system, it would have the following three activity cost pools:
3a. What is the predetermined overhead allocation rate using the traditional costing system?
3b. What is the overhead cost per skateboard using an activity-based costing system?
week 3
<pclass=msonormal>ACCT34
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Week 3
Directions: Your assignment this week is to answer the two questions below. Please note
that Question #2 has 2 parts, Part A and Part B. Please show your work for full credit and
use the box provided. Please add more rows or columns to the box if needed.
1. Beginning WIP inventory is 15,500 units, 75% complete for materials. During the
month, 90,000 units were started; 87,000 were finished; and ending WIP was 18,500
units that were 50% complete for materials.
How many equivalent units should be used to allocate costs for materials? (Assume that the
weighted average method is used, not FIFO.)
2. During a period, 38,200 units were completed and 4,200 units were in ending WIP
inventory. Ending WIP was 75% complete for direct materials and 50% complete for
conversion costs.
2a. What are the equivalent units for direct materials?
2b. What are the equivalent units for conversion costs?
week 4
<pclass=msonormal>DeVryDeVry University
ACCT346 Weekly Assignment
Week 5
Directions: Your assignment this week is to answer the below three questions. Please note
that question #1 has 2 parts, part a and part b and question #2 has 3 parts, part a, part b
and part c. Please show your work for full credit and use the box provided. Please add more
rows or columns to the box if needed.

1. Palmers Gourmet Chocolates produces and sells assorted boxed chocolates. The
unit selling price is $50, unit variable costs are $25, and total fixed costs are $2,000.
1a. How many boxes of chocolates must Palmers Gourmet Chocolates sell to breakeven?
1b. What are breakeven sales in dollars?
2. Extreme Sports received a special order for 1,000 units of its extreme motorbike at a
selling price of $250 per motorbike. Extreme Sports has enough extra capacity to
accept the order. No additional selling costs will be incurred. Unit costs to make and
sell this product are as follows: Direct materials, $100; direct labor, $50; variable
manufacturing overhead, $14; fixed manufacturing overhead, $10, and variable
selling costs, $2.
2a. List the relevant costs.
2b. What will be the change in operating income if Extreme Sports accepts the special
order?
2c. Should Extreme Sports accept the special order? Why or why not?
3. Totally Technology manufactures Cameras and Video Recorders. The companys
product line income statement follows:
Camera Video Recorder Total
Sales revenue $3,00,000 $1,00,000 $4,00,000
Cost of goods sold
Variable $75,000 $49,000 $1,24,000
Fixed $82,000 $28,000 $1,10,000
Total cost of goods sold $1,57,000 $77,000 $2,34,000
Gross profit $1,43,000 $23,000 $1,66,000
Marketing and administrative expenses

Variable $25,000 $28,000 $53,000


Fixed $32,000 $19,000 $51,000
Total marketing and administrative expenses $57,000 $47,000 $1,04,000
Operating income (loss) $86,000 (24,000) $62,000
Management is considering discontinuing the Video Recorder product line. Accountants for
the company estimate that discontinuing the Video Recorder line will decrease fixed cost of
goods sold by $10,000 and fixed marketing and administrative expenses by $4,000.
Prepare an analysis supporting your opinion about whether or not the Video Recorder
product line should be discontinued.
<pclass=msonormal style=color: rgb(0, 0, 0); font-family: Verdana, arial, sans-serif; fontsize: 12px; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing:
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none; white-space: normal; widows: 1; word-spacing: 0px; -webkit-text-stroke-width:
0px;><pclass=msonormal><pclass=msonormal>UniversiDeVry University
ACCT346 Weekly Assignment
Week 6
Directions: Your assignment this week is to answer the two questions below. Please note
that Question #2 has 2 parts, Part A and Part B. Please show your work for full credit and
use the box provided. Please add more rows or columns to the box if needed.
1. Cave Hardwares forecasted sales for April, May, June, and July are $200,000,
$230,000, $190,000, and $240,000, respectively. Sales are 65% cash and 35%
credit with all accounts receivables collected in the month following the sale. Cost of
goods sold is 75% of sales and ending inventory is maintained at $60,000 plus 10%
of the following months cost of goods sold. All inventory purchases are paid 22% in
the month of purchase and 78% in the following month.
What are the cash collections budgeted for June?

2. Madden Corporation manufactures t-shirts, which is its only product. The standards
for t-shirts are as follows:
Standard direct labor cost per hour $17
Standard direct labor hours per t-shirt 0.6
During the month of January, the company produced 1,250 t-shirts. Related production data
for the month is as follows:
Actual direct labor hours 770
Actual direct labor cost incurred $13,000
2a. What is the direct labor rate variance for the month? Is it favorable or unfavorable?
2b. What is the direct labor efficiency variance for the month? Is it favorable or unfavorable?
ty
ACCT346 Weekly Assignment
Week 4
Directions: Your assignment this week is to answer the question below which has four parts.
Please show your work for full credit and use the boxes provided. Please add more rows or
columns to the box if needed.
1. MountainAir Company has the following selected data for the past year:
Units sold during year 30,000
Units produced during year 45,000
Units in ending inventory 15,000
Variable manufacturing cost per unit $4.50

Fixed manufacturing overhead (in total) $20,250


Selling price per unit $12.00
Variable selling and administrative expense per unit $1.00
Fixed selling and administrative expenses (in total) $4,000
There were no units in beginning inventory.
Required:
1a. Prepare an income statement for last year using absorption costing.
1b. Calculate the value of the ending inventory using absorption costing.
1c. Prepare an income statement for last year using variable costing.
1d. Calculate the value of the ending inventory using variable costing.
week 6
<pclass=msonormal>DeVry University
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>
ACCT346 Weekly Assignment
Week 6
Directions: Your assignment this week is to answer the two questions below. Please note
that Question #2 has 2 parts, Part A and Part B. Please show your work for full credit and
use the box provided. Please add more rows or columns to the box if needed.
1. Cave Hardwares forecasted sales for April, May, June, and July are $200,000,
$230,000, $190,000, and $240,000, respectively. Sales are 65% cash and 35%

credit with all accounts receivables collected in the month following the sale. Cost of
goods sold is 75% of sales and ending inventory is maintained at $60,000 plus 10%
of the following months cost of goods sold. All inventory purchases are paid 22% in
the month of purchase and 78% in the following month.
What are the cash collections budgeted for June?
2. Madden Corporation manufactures t-shirts, which is its only product. The standards
for t-shirts are as follows:
Standard direct labor cost per hour $17
Standard direct labor hours per t-shirt 0.6
During the month of January, the company produced 1,250 t-shirts. Related production data
for the month is as follows:
Actual direct labor hours 770
Actual direct labor cost incurred $13,000
2a. What is the direct labor rate variance for the month? Is it favorable or unfavorable?
2b. What is the direct labor efficiency variance for the month? Is it favorable or unfavorable?
week 7
<pclass=msonormal>DeVry University
ACCT346 Weekly Assignment
Week 7
Directions: Your assignment this week is to answer the four questions below. Please note
that Question #1 has 2 parts, Part A and Part B. Please show your work for full credit and
use the box provided. Please add more rows or columns to the box if needed.

1. Gomez Corporation is considering two alternative investment proposals with the


following data:
Proposal X Proposal Y
Investment $8,50,000 $4,68,000
Useful life 8 years 8 years
Estimated annual net $1,25,000 $78,000
cash inflows for 8 years
Residual value $40,000 $
Depreciation method Straight-line Straight-line
Required rate of return 14% 10%
1a. How long is the payback period for Proposal X?
1b. What is the accounting rate of return for Proposal Y?
2. You have been awarded a scholarship that will pay you $500 per semester at the end
of each of the next 8 semesters that you earn a GPA of 3.5 or better. You are a very
serious student and you anticipate receiving the scholarship every semester. Using a
discount rate of 3% per semester, which of the following is the correct calculation for
determining the present value of the scholarship? PLEASE STATE WHY YOU
CHOSE THE ANSWER THAT YOU DID.
3. A) PV = $500 3% 8
4. B) PV = $500 (Annuity PV factor, i = 3%, n = 8)
5. C) PV = $500 (Annuity FV factor, i = 6%, n = 4)
6. D) PV = $1,000 (PV factor, i = 3%, n = 4)
7. Maersk Metal Stamping is analyzing a special investment project. The project will
require the purchase of two machines for $30,000 and $8,000 (both machines are
required). The total residual value at the end of the project is $1,500. The project will
generate cash inflows of $11,000 per year over its 8-year life.

If Maersk requires a 6% return, what is the net present value (NPV) of this project? (Use
present value tables or Excel.)
4. Hincapie Manufacturing is evaluating investing in a new metal stamping machine
costing $30,924. Hincapie estimates that it will realize $12,000 in annual cash
inflows for each year of the machines 3-year useful life.
Approximately, what is the the internal rate of return (IRR) for the machine? (Use present
value tables or Excel.)