Managerial Accounting: Tools for Business Decision Making 7e + WileyPLUS Registration Card
7th Edition
ISBN: 9781119036432
Author: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
Publisher: Wiley (WileyPLUS Products)
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Textbook Question
Chapter 1, Problem 1.5AP
Empire Company is a manufacturer of smart phones. Its controller resigned in October 2017. An inexperienced assistant accountant has prepared the following income statement for the month of October 2017.
EMPIRE COMPANY
Income Statement
For the Month Ended October 31, 2017
| Sales revenue | $780,000 | |
| Less: Operating expenses | ||
| Raw materials purchases | $264,000 | |
| Direct labor cost | 190,000 | |
| Advertising expense | 90,000 | |
| Selling and administrative salaries | 75,000 | |
| Rent on factory facilities | 60,000 | |
| 45,000 | ||
| Depreciation on factory equipment | 31,000 | |
| Indirect labor cost | 28,000 | |
| Utilities expense | 12,000 | |
| Insurance expense | 8,000 | 803,000 |
| Net loss | $ (23,000) |
Prior to October 2017, the company had been profitable every month. The company’s president is concerned about the accuracy of the income statement. As her friend, you have been asked to review the income statement and make necessary corrections. After examining other
1. Inventory balances at the beginning and end of October were:
| October 1 | October 31 | |
| Raw materials | $18,000 | $29,000 |
| Work in process | 20,000 | 14,000 |
| Finished goods | 30,000 | 50,000 |
2. Only 75% of the utilities expense and 60% of the insurance expense apply to factory operations. The remaining amounts should be charged to selling and administrative activities.
Instructions
(a) Prepare a schedule of cost of goods manufactured for October 2017.
(b) Prepare a correct income statement for October 2017.
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Ron Howard recently took over as the controller of Johnson Brothers Manufacturing. Last month, the previous controller left the company with little notice and left the accounting records in disarray. Ron needs the ending inventory balances to report first-quarter numbers. For the previous month (March 2017) Ron was able to piece together the following information:Direct materials purchased $120,000
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Aelan Products Company, a small manufacturer, has submitted the items below concerning last year's operations. The president's secretary, trying to be helpful, has alphabetized the list.
Administrative salaries
$4,800
Advertising expense
2,400
Depreciation—factory building
1,600
Depreciation—factory equipment
3,200
Depreciation—office equipment
360
Direct labour cost
43,800
Raw materials inventory, beginning
4,200
Raw materials inventory, ending
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Finished goods inventory, beginning
93,960
Finished goods inventory, ending
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General liability insurance expense
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Indirect labour cost
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29,200
Repairs and maintenance of factory
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Sales salaries
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Taxes on factory
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Travel and entertainment expense
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Chapter 1 Solutions
Managerial Accounting: Tools for Business Decision Making 7e + WileyPLUS Registration Card
Ch. 1 - Prob. 1QCh. 1 - Distinguish between managerial and financial...Ch. 1 - How do the content of reports and the verification...Ch. 1 - Prob. 4QCh. 1 - Decision-making is managements most important...Ch. 1 - Explain the primary difference between line...Ch. 1 - Prob. 7QCh. 1 - Prob. 8QCh. 1 - How are manufacturing costs classified?Ch. 1 - Mel Finney claims that the distinction between...
Ch. 1 - Tina Burke is confused about the differences...Ch. 1 - Identify the differences in the cost of goods sold...Ch. 1 - The determination of the cost of goods...Ch. 1 - Sealy Company has beginning raw materials...Ch. 1 - Tate Inc. has beginning work in process 26,000,...Ch. 1 - Using the data in Question 15, what are (a) the...Ch. 1 - In what order should manufacturing inventories be...Ch. 1 - How does the output of manufacturing operations...Ch. 1 - Discuss whether the product costing techniques...Ch. 1 - What is the value chain? Describe, in sequence,...Ch. 1 - What is an enterprise resource planning (HRP)...Ch. 1 - Why is product quality important for companies...Ch. 1 - Explain what is meant by balanced in the balanced...Ch. 1 - In what ways can the budgeting process create...Ch. 1 - What new rules were enacted under the...Ch. 1 - What is activity-based costing, and what are its...Ch. 1 - Distinguish between managerial and financial...Ch. 1 - Prob. 1.2BECh. 1 - Determine whether each of the following costs...Ch. 1 - Prob. 1.4BECh. 1 - Identify whether each of the following costs...Ch. 1 - Presented below are Rook Companys monthly...Ch. 1 - Francum Company has the following data: direct...Ch. 1 - In alphabetical order below are current asset...Ch. 1 - Presented below are incomplete manufacturing cost...Ch. 1 - Use the same data from BE1-9 above and the data...Ch. 1 - Prob. 1.11BECh. 1 - Prob. 1.1DICh. 1 - Identify managerial cost classifications. (LO 2),...Ch. 1 - The following information is available for Tomlin...Ch. 1 - Match the descriptions that follow with the...Ch. 1 - Justin Bleeber has prepared the following list of...Ch. 1 - Presented below is a list of costs and expenses...Ch. 1 - Trak Corporation incurred the following costs...Ch. 1 - Determine the total amount of various types of...Ch. 1 - Gala Company is a manufacturer of laptop...Ch. 1 - Prob. 1.6ECh. 1 - National Express reports the following costs and...Ch. 1 - Lopez Corporation incurred the following costs...Ch. 1 - An incomplete cost of goods manufactured schedule...Ch. 1 - Manufacturing cost data for Copa Company are...Ch. 1 - Incomplete manufacturing cost data for Horizon...Ch. 1 - Cepeda Corporation has the following cost records...Ch. 1 - Keisha Tombert, the bookkeeper for Washington...Ch. 1 - The following information is available for Aikman...Ch. 1 - University Company produces collegiate apparel....Ch. 1 - An analysis of the accounts of Roberts Company...Ch. 1 - McQueen Motor Company manufactures automobiles....Ch. 1 - The following is a list of terms related to...Ch. 1 - Prob. 1.1APCh. 1 - Bell Company, a manufacturer of audio systems,...Ch. 1 - Incomplete manufacturing costs, expenses, and...Ch. 1 - Prepare a cost of goods manufactured schedule, a...Ch. 1 - Empire Company is a manufacturer of smart phones....Ch. 1 - Prob. 1.1WPCh. 1 - Prob. 1.1BYPCh. 1 - Tenrack is a fairly large manufacturing company...Ch. 1 - Prob. 1.4BYPCh. 1 - The primary purpose of managerial accounting is to...Ch. 1 - As noted in this chapter, because of global...
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