COST ACCOUNTING
16th Edition
ISBN: 9781323694008
Author: Horngren
Publisher: PEARSON C
expand_more
expand_more
format_list_bulleted
Concept explainers
Textbook Question
Chapter 1, Problem 1.28P
Planning and control decisions, Internet company. PostNews.com offers its subscribers several services, such as an annotated TV guide and local-area information on weather, restaurants, and movie theaters. Its main revenue sources are fees for banner advertisements and fees from subscribers. Recent data are as follows:
The following decisions were made from June through October 2017:
- a. June 2017: Raised subscription fee to $25.50 per month from July 2017 onward. The budgeted number of subscribers for this monthly fee is shown in the following table.
- b. June 2017: Informed existing subscribers that from July onward, monthly fee would be $25.50.
- c. July 2017: Offered e-mail service to subscribers and upgraded other online services.
- d. October 2017: Dismissed the vice president of marketing after significant slowdown in subscribers and subscription revenues, based on July through September 2017 data in the following table.
- e. October 2017: Reduced subscription fee to $22.50 per month from November 2017 onward.
Results for July-September 2017 are as follows:
- 1. Classify each of the decisions (a–e) as a planning or a control decision.
Required
- 2. Give two examples of other planning decisions and two examples of other control decisions that may be made at PostNews.com.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
BioGrow Sdn. Bhd is a retail fertilizer to farmers in Jitra. The company has approached its Bankers to provide funding for next year’s operations. In considering their funding application, a three - month master budget has been requested for review by the bankers.As a freelance accounting service provider, you have been approached by the management as a consultant to prepare the 1st quarter budget for the banker’s consideration for its next year’s (2021) operations.Below is the information as at the end of accounting year of December 2020:
Debtors 23,000Bank 55,000Fixed asset at cost 698,000Accumulated depreciation 98,000Creditors 48,000Operating expenses for December 60,000Sales for December 400,000Ending inventory 20,000Retained earnings 120,000
The following additional information was also provided to assist your work.i) Depreciation is provided at the rate of 5% on cost of non-current assets per month.ii) Closing inventory is expected to increase by RM2000 in January from December…
The background information has been provided in the photos attached.
B) Given that selling, distribution and administrative costs associated with the V380PRO brand of WIFI SMART camera bulbs for the quarter were $27,255, $42,400 and $145,600 respectively. Prepare an income statement for Sim-Jo-La (V380PRO) for the period April 30, 2020 to June 30, 2020.
C) Journalize the transactions for the month of April, assuming the company uses a:
i) Periodic Inventory System
ii) Perpetual inventory system
BioGrow Sdn. Bhd is a retail fertilizer to farmers in Jitra. The company has approached its Bankers to provide funding for next year’s operations. In considering their funding application, a three - month master budget has been requested for review by the bankers.
As a freelance accounting service provider, you have been approached by the management as a consultant to prepare the 1st quarter budget for the banker’s consideration for its next year’s (2021) operations.
Below is the information as at the end of accounting year of December 2020:
Details
RM
Debtors
23,000
Bank
55,000
Fixed asset at cost
698,000
Accumulated depreciation
98,000
Creditors
48,000
Operating expenses for December
60,000
Sales for December
400,000
Ending inventory
20,000
Retained earnings
120,000
The following additional information was also provided to assist your work.
i) Depreciation is provided at the rate of 5% on cost of…
Chapter 1 Solutions
COST ACCOUNTING
Ch. 1 - How does management accounting differ from...Ch. 1 - Management accounting should not fit the...Ch. 1 - How can a management accountant help formulate...Ch. 1 - Describe the business functions in the value...Ch. 1 - Explain the term supply chain and its importance...Ch. 1 - Management accounting deals only with costs. Do...Ch. 1 - How can management accountants help improve...Ch. 1 - Prob. 1.8QCh. 1 - Prob. 1.9QCh. 1 - What three guidelines help management accountants...
Ch. 1 - Prob. 1.11QCh. 1 - Prob. 1.12QCh. 1 - Prob. 1.13QCh. 1 - Prob. 1.14QCh. 1 - Prob. 1.15QCh. 1 - Which of the following is not a primary function...Ch. 1 - Value chain and classification of costs, computer...Ch. 1 - Prob. 1.18ECh. 1 - Value chain and classification of costs, fast-food...Ch. 1 - Key success factors. Dominion Consulting has...Ch. 1 - Key success factors. Vargas Construction Company...Ch. 1 - Planning and control decisions. Gregor Company...Ch. 1 - Planning and control decisions. Gavin Adams is the...Ch. 1 - Prob. 1.24ECh. 1 - Five-step decision-making process, service firm....Ch. 1 - Professional ethics and reporting division...Ch. 1 - Professional ethics and reporting division...Ch. 1 - Planning and control decisions, Internet company....Ch. 1 - Prob. 1.29PCh. 1 - Prob. 1.30PCh. 1 - Management accounting guidelines. For each of the...Ch. 1 - Prob. 1.32PCh. 1 - Prob. 1.33PCh. 1 - Budgeting, ethics, pharmaceutical company. Chris...Ch. 1 - Professional ethics and end-of-year actions. Linda...Ch. 1 - Professional ethics and end-of-year actions....Ch. 1 - Ethical challenges, global company environmental...
Additional Business Textbook Solutions
Find more solutions based on key concepts
Discussion Analysis A13-41 Discussion Questions 1. How do managers use the statement of cash flows? 2. Describ...
Managerial Accounting (5th Edition)
What are assets limited as to use and how do they differ from restricted assets?
Accounting for Governmental & Nonprofit Entities
Interest-bearing notes payable with year-end adjustments P1 Keesha Co. borrows $200,000 cash on November 1, 201...
Financial Accounting: Information for Decisions
18. What is the calculation for return on assets (ROA)? Explain what ROA measures.
Horngren's Financial & Managerial Accounting, The Financial Chapters (6th Edition)
The managers of an organization are responsible for performing several broad functions. They are ______________...
Principles of Accounting Volume 2
How is activity-based costing useful for pricing decisions?
Cost Accounting (15th Edition)
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- Revenue and production budgets. (CPA, adapted) The Chen Corporation manufactures and sells two products: Thingone and Thingtwo. In July 2016, Chen’s budget department gathered the following data to prepare budgets for 2017:arrow_forwardBioGrow Sdn. Bhd is a retail fertilizer to farmers in Jitra. The company has approached its Bankers to provide funding for next year’s operations. In considering their funding application, a three - month master budget has been requested for review by the bankers. As a freelance accounting service provider, you have been approached by the management as a consultant to prepare the 1st quarter budget for the banker’s consideration for its next year’s (2021) operations. Below is the information as at the end of accounting year of December 2020: Details RM Debtors 23,000 Bank 55,000 Fixed asset at cost 698,000 Accumulated depreciation 98,000 Creditors 48,000 Operating expenses for December 60,000 Sales for December 400,000 Ending inventory 20,000 Retained earnings 120,000 The following additional information was also provided to assist your work. Depreciation is provided at the rate of 5% on cost of…arrow_forwardowa Imaging Center provided the financial information in Exhibit 5.15 below. Prepare a cash budget for the quarter ending March 20X1. For Blackboard you will enter your ENDING cash balance for the months of January 20X1, February 20X1, March 20X1, and the Quarter ending March 20X1. I want you to submit your work for this problem by email so I can review the entire document. Exhibit 5-15 Iowa Imaging Center Givens Revenues and Expenses Patient Revenues, 20X0 Estimated Patient Revenues, 20X1 Given 1 October $4,000,000 Given 2 January $4,300,000 November $4,200,000 February $4,350,000 December $4,300,000 March $4,400,000 Other Revenues, 20X1 Estimated Cash Outflows, 20X1a Given 3 January $90,000 Given 4 January $4,250,000…arrow_forward
- Printing Supply of Baltimore has applied for a loan. Its bank has requested a budgeted income statement for April 2024 and budgeted balance sheet at April 30, 2024. The March 31, 2024, balance sheet follows: As Tune Printing Supply's controller, you have assembled the following additional information: a. April dividends of $6,000 were declared and paid. b. April capital expenditures of $16,200 budgeted for cash purchase of equipment. c. April depreciation expense, $500. d. Cost of goods sold, 45% of sales. e. Desired ending inventory for April is $22,800. f. April selling and administrative expenses include salaries of $32,000, 30% of which will be paid in cash and the remainder paid next month. g. Additional April selling and administrative expenses also include miscellaneous expenses of 15% of sales, all paid in April. h. April budgeted sales, $86,000, 50% collected in April and 50% in May. i. April…arrow_forwardAccount analysis, high-low. Stein Corporation wants to find an equation to estimate some of their monthly operating costs for the operating budget for 2018. The following cost and other data were gathered for 2017:arrow_forwardUse the information supplied to prepare the following for Silver City Traders for the three months ending 31 March 2022. 1.1 Debtors collection schedule. 1.2 Cash budget statement.arrow_forward
- Printing Supply of Baltimore has applied for a loan. Its bank has requested a budgeted income statement for April 2024 and budgeted balance sheet at April 30, 2024. The March 31, 2024, balance sheet follows: As Tune Printing Supply's controller, you have assembled the following additional information: a. April dividends of $6,000 were declared and paid. b. April capital expenditures of $16,200 budgeted for cash purchase of equipment. c. April depreciation expense, $500. d. Cost of goods sold, 45% of sales. e. Desired ending inventory for April is $22,800. f. April selling and administrative expenses include salaries of $32,000, 30% of which will be paid in cash and the remainder paid next month. g. Additional April selling and administrative expenses also include miscellaneous expenses of 15% of sales, all paid in April. h. April budgeted sales, $86,000, 50% collected in April and 50% in May. i. April…arrow_forwardA United Foods LLC have provided the following information and you are requested to prepare cash budget for the months from June to September 2016. Month Sales Salary Marketing Expenses Rent Additional information: a. b. June (Amount OMR) 90,000 60,000 9,000 3,000 July (Amount OMR) 120,000 75,000 12,000 6,000 August (Amount OMR) 150,000 60,000 12,000 6,000 Cash balance at the beginning of June 2016 is RO. 45,000 All sales is cash sales c. Salaries and Marketing expenses are paid at the beginning of next month d. Rent is settled in the same month كان الشرق الأوسط Middle East College September (Amount OMR) 180,000 90,000 12,000 3,000arrow_forwardPrepare schedules for cash receipts and cash payments, and determine the ending balances for the relevant balance sheet accounts. E10.30 (LO 4, 5) Service Environmental Landscaping Inc. is preparing its budget for the first quarter of 2022. The next step is to prepare a cash receipts schedule and a cash payments schedule. The following information has been collected: 1. Clients usually pay 50% of their fee in the month when the service is provided, 40% the next month, and 10% in the second month after receiving the service. 2. Actual service revenues for 2021 and expected service revenues for 2022 are as follows: November 2021, $90,000; December 2021, $70,000; January 2022, $110,000; February 2022, $120,000; and March 2022, $130,000. 3. The company pays for purchases of landscaping supplies (direct materials) 60% in the month of purchase and 40% the following month. Actual purchases for 2021 and expected purchases for 2022 are: December 2021, $14,000; January 2022, $13,000; February…arrow_forward
- Account analysis, high-low. Stein Corporation wants to nd an equation to estimate some of their monthly operating costs for the operating budget for 2018. The following cost and other data were gathered for 2017:arrow_forwardA company uses charging rates to allocate service department costs to the using departments. The accountant compiled the following information on one of the service departments: If Department K plans to use 1,350 hours of the service departments service in the coming year, how much of the service departments cost is allocated to Department K? a. 3,375 b. 27,300 c. 26,325 d. 23,950arrow_forwardJournalize the transactions below using a two-column general journal. The April 2014 transactions of Budget Driving Institute owned and managed by Crispin Rosales are listed below: 2 Rosales invested P250,000 cash and P15,000 furniture and fixtures. 4 Two second hand cars were purchased and a 50% down payment of P150,000 made. Issued a promissory note for the balance. 5 Bought office equipment for cash, P12,000. 6 Two student drivers filled up an application form stating, among others, that they were willing to pay P2,000 each for a one-week lesson. 7 Paid P2,000 for gas and oil. 8 Paid P10,000 for an advertisement that was posted along the highway to promote the business. 11 The two student drivers paid in full. 14 Another two student drivers were billed for P4,000 but only one paid in cash. 15 Salaries were paid for the first half of April amounting to P4,500. 19 Ms. Rosales made a cash withdrawal of P1,500. 20 Driving Fees of P7,000 were billed to various clients but only 50% was…arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Excel Applications for Accounting PrinciplesAccountingISBN:9781111581565Author:Gaylord N. SmithPublisher:Cengage LearningCornerstones of Cost Management (Cornerstones Ser...AccountingISBN:9781305970663Author:Don R. Hansen, Maryanne M. MowenPublisher:Cengage LearningPrinciples of Cost AccountingAccountingISBN:9781305087408Author:Edward J. Vanderbeck, Maria R. MitchellPublisher:Cengage Learning
Excel Applications for Accounting Principles
Accounting
ISBN:9781111581565
Author:Gaylord N. Smith
Publisher:Cengage Learning
Cornerstones of Cost Management (Cornerstones Ser...
Accounting
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Cengage Learning
Principles of Cost Accounting
Accounting
ISBN:9781305087408
Author:Edward J. Vanderbeck, Maria R. Mitchell
Publisher:Cengage Learning
Responsibility Accounting| Responsibility Centers and Segments| US CMA Part 1| US CMA course; Master Budget and Responsibility Accounting-Intro to Managerial Accounting- Su. 2013-Prof. Gershberg; Author: Mera Skill; Rutgers Accounting Web;https://www.youtube.com/watch?v=SYQ4u1BP24g;License: Standard YouTube License, CC-BY