As it turned out, the new collars failed Blossom-T's quality control testing. Stuck with unwearable T-shirts, the company was also in a bind with its retail outlets, which wanted more shirts to sell! The costs to produce this most recent batch of shirts is as follows. Direct material Direct labor $75,000 29,000 Manufacturing overhead 15,000 Total costs $119,000 Volume in batch 20,000
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- I keep working this problem over and over and been working on it but cant seem to get it right [The following information applies to the questions displayed below.] Hult Games buys electronic components for manufacturing from two suppliers, Milan Components and Dundee Parts. If the components are delivered late, the shipment to the customer is delayed. Delayed shipments lead to contractual penalties that call for Hult to reimburse a portion of the purchase price to the customer. During the past quarter, the purchasing and delivery data for the two suppliers showed the following. Milan Dundee Total Total purchases (cartons) 98,000 42,000 140,000 Average purchase price (per carton) $ 20.00 $ 22 $ 20.60 Number of deliveries 80 20 100 Percentage of late deliveries 25 % 10 % 22 % The Accounting Department recorded $602,700 as the cost of late deliveries to customers. Required: Assume that the average quality,…The demand for cocoa butter hand lotion, one of numerous products manufactured by Smooth Skin Care Products Inc., has dropped sharply because of recent competition from a similar product. The controller has been asked by the president of the company for advice on whether to continue production during the following month or to suspend the manufacture of cocoa butter hand lotion until a strategy to regain market share. The controller has assembled the following pertinent data: Smooth Skin Care Products Inc. Income Statement - Cocoa Butter Hand Lotion For the Month Ended January 31 Financial Categories Sales (400,000) Cost of goods sold Gross profit Dollar Amount $ 32,200,000 $28,330,000 $ 3,870,000 Selling and admin expenses Loss from operations $ 4,270,000 $ (400,000) The production costs and selling and administrative expenses, based on the production of 400,000 units in the Income Statement above, are as follows: Direct materials Category Dollar Amount $16 per unit 17 per unit Direct…Consider each of the following independent scenarios:a. Terrin Belson, plant manager for the laser printer factory of Compugear Inc., brushed hishair back and sighed. December had been a bad month. Two machines had broken down,and some factory production workers (all on salary) were idled for part of the month.Materials prices increased, and insurance premiums on the factory increased. No way outof it; costs were going up. He hoped that the marketing vice president would be able topush through some price increases, but that really wasn’t his department.b. Joanna Pauly was delighted to see that her ROI figures had increased for the third straightyear. She was sure that her campaign to lower costs and use machinery more efficiently(enabling her factories to sell several older machines) was the reason why. Joanna plannedto take full credit for the improvements at her semiannual performance review.c. Gil Rodriguez, sales manager for ComputerWorks, was not pleased with a memo…
- During the COVID-19 pandemic, many people decided to start making face masks and selling them on the Internet. Etsy, for example, sold face masks from many different sellers. Suppose that Mary decided to quit her job where she earned $3,600.00 per month. During the month of July 2020, Mary sold 1,100.00 masks at $7.00 per mask. The following table reports information for Mary's costs to make the face masks. Item Material Wages paid to one employee Utilities Internet advertising For the month of July 2020, Mary's revenue was $ Part 2 Mary's accounting profit was $ Part 3 Amount $3,300.00 $550.00 $110.00 $275.00 Mary's economic profit was $ . Make sure you include the negative sign if her profit is less than zero.Watko Entertainment Systems (WES) buys audio and video components for assembling home entertainment systems from two suppliers, Bacon Electronics and Hessel Audio and Video. The components are delivered in cartons. If the cartons are delivered late, the installation for the customer is delayed. Delayed installations lead to contractual penalties that call for WES to reimburse a portion of the purchase price to the customer. During the past quarter, the purchasing and delivery data for the two suppliers showed the following: Bacon 5,000 $ 192 40 30% Bacon Hessel Hessel 3,000 $ 208 Total purchases (cartons) Average purchase price (per carton) Number of deliveries Percentage of cartons delivered late. The Accounting Department recorded $265,200 as the cost of late deliveries to customers. Effective Cost Per Carton Total 8,000 $ 198 20 15% Required: Assume that the average quality, measured by the percentage of late deliveries, and prices from the two companies will continue as in the…Watko Entertainment Systems (WES) buys audio and video components for assembling home entertainment systems from two suppliers, Bacon Electronics and Hessel Audio and Video. The components are delivered in cartons. If the cartons are delivered late, the installation for the customer is delayed. Delayed installations lead to contractual penalties that call for WES to reimburse a portion of the purchase price to the customer. During the past quarter, the purchasing and delivery data for the two suppliers showed the following: Bacon Hessel Total Total purchases (cartons) 5,000 3,000 8,000 Average purchase price (per carton) $ 170 $ 186 $ 176 Number of deliveries 40 20 60 Percentage of cartons delivered late. 30% 15% 25% The Accounting Department recorded $243,750 as the cost of late deliveries to customers. Required: Assume that the average quality, measured by the percentage of late deliveries, and prices from the two companies will continue as in the past. Also…
- Watko Entertainment Systems (WES) buys audio and video components for assembling home entertainment systems from two suppliers, Bacon Electronics and Hessel Audio and Video. The components are delivered in cartons. If the cartons are delivered late, the installation for the customer is delayed. Delayed installations lead to contractual penalties that call for WES to reimburse a portion of the purchase price to the customer. During the past quarter, the purchasing and delivery data for the two suppliers showed the following: Bacon 5,000 $ 182 40 Total purchases (cartons) Average purchase price (per carton) Number of deliveries Percentage of cartons delivered late. 30% Bacon Hessel Hessel 3,000 $198 20 15% The Accounting Department recorded $255,450 as the cost of late deliveries to customers. Effective Cost Per Carton Total 8,000 $ 188 60 25% Exercise 10-38 (Algo) Activity-Based Costing of Suppliers (LO 10-3, 4) Required: Assume that the average quality, measured by the percentage of…Watko Entertainment Systems (WES) buys audio and video components for assembling home entertainment systems from two suppliers, Bacon Electronics and Hessel Audio and Video. The components are delivered in cartons. If the cartons are delivered late, the installation for the customer is delayed. Delayed installations lead to contractual penalties that call for WES to reimburse a portion of the purchase price to the customer. During the past quarter, the purchasing and delivery data for the two suppliers showed the following: Bacon Hessel Total Total purchases (cartons) 5,000 3,000 8,000 Average purchase price (per carton) $ 176 $ 192 $ 182 Number of deliveries 40 20 60 Percentage of cartons delivered late. 30% 15% 25% The Accounting Department recorded $249,600 as the cost of late deliveries to customers. Exercise 10-38 (Algo) Activity-Based Costing of Suppliers (LO 10-3, 4) Required: Assume that the average quality, measured by the percentage of late…LL is a company that makes and sells clothing made out of wool. It has been having problems manufacturing sufficient garments for its customers for several years as demand has increased significantly. LL's current wool spinning process has been identified as a bottleneck process.It is considering the purchase of an automated spinning machine that it believes will significantly improve the speed of its manufacturing process. In addition it will allow LL to lay off around fifty members of staff (who are heavily unionised).The machine will cost around $5m. LL does not have this cash available, but believes that it will be able to raise these funds from its investors.LL will only purchase the machine if it is: suitable acceptable; AND feasible From the information given above, which of these three criteria does the acquisition of the machine meet? Suitable and acceptable only Suitable only Acceptable and feasible only Suitable and feasible only
- Ethics Case Electronics, Inc. is a high-volume, wholesale merchandising company. Most of its inventory turns over four or five times a year. The company has had 50 units of a particular brand of computers on hand for over a year. These computers have not sold and probably will not sell unless they are discounted 60 to 70%. The accountant is carrying them on the books at cost and intends to recognize the loss when they are sold. This way, she can avoid a significant write-down in inventory on the current year’s financial statements. 1. Is the accountant correct in her treatment of the inventory? Why or why not? 2. If the computers cost $1,000 each and their market value is 40% of their cost, journalize the entry necessary for the write-down. 3. In groups of three or four, make a list of reasons why inventories of electronic equipment might have to be written down.Clothing Retail Store's accountant prepared the following income statement for the teenagers' accessories product line: Sales Less: Variable expenses Contribution margin Less: Fixed expenses: Wages Insurance on inventory Advertising Net operating income (loss) Sales $1,035,000 57,500 632,500 Management is concerned about the loss and is considering dropping the product line. If the product line is dropped, a job has to be created elsewhere for a long-term employee currently earning an annual salary of $101,500. Fixed expenses $2,875,000 1,351, 250 1,523,750 Required: Calculate the increase or decrease in the operating income in both alternatives. Net operating income (loss) 1,725,000 $ (201,250) Keep Accesories Product Line Drop Accesories Product Line[The following information applies to the questions displayed below.] Watko Entertainment Systems (WES) buys audio and video components for assembling home entertainment systems from two suppliers, Bacon Electronics and Hessel Audio and Video. The components are delivered in cartons. If the cartons are delivered late, the installation for the customer is delayed. Delayed installations lead to contractual penalties that call for WES to reimburse a portion of the purchase price to the customer. During the past quarter, the purchasing and delivery data for the two suppliers showed the following: Bacon Hessel Total Total purchases (cartons) 5,000 3,000 8,000 Average purchase price (per carton) $ 190 $ 206 $ 196 Number of deliveries 40 20 60 Percentage of cartons delivered late. 30% 15% 25% The Accounting Department recorded $263,250 as the cost of late deliveries to customers. Required: Assume that the average quality, measured by the percentage of late deliveries,…