Horngren's Accounting (12th Edition)
12th Edition
ISBN: 9780134486444
Author: Tracie L. Miller-Nobles, Brenda L. Mattison, Ella Mae Matsumura
Publisher: PEARSON
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Textbook Question
Chapter 24, Problem 10CP
Comprehensive Problem for Chapters 22-24
The Trolley Toy Company manufactures toy building block sets for children. Trolley is planning for 2019 by developing a
TROLLEY TOY COMPANY Balance Sheet December 31, 2018 |
||
Assets | ||
Current Assets: | ||
Cash S |
$58,000 | |
22,000 | ||
Raw Materials Inventory | 1,200 | |
Finished Goods Inventory | 5,400 | |
Total Current Assets | $ 86,600 | |
Property, Plant, and Equipment: | ||
Equipment | 142,000 | |
Less: Accumulated Depreciation | (47,000) | 95,000 |
Total Assets | $ 181,600 | |
Liabilities | ||
Current Liabilities: | ||
Accounts Payable | $ 8,000 | |
Common Stock, no par $ 120,000 |
||
53,600 | ||
Total Stockholders' Equity | 173,600 | |
Total Liabilities and Stockholders' Equity | $ 181,600 |
Other budget data for Trolley Toy Company:
- Budgeted sales are 1,400 sets for the first quarter and expected to increase by 150 sets per quarter. Cash sales are expected to be 30% of total sales, with the remaining 70% of sales on account. Sets are budgeted to sell for $90 per set.
- Finished Goods Inventory on December 31,2018, consists of 200 sets at $27 each.
- Desired ending Finished Goods Inventory is 40% of the next quarter's sales; first quarter sales for 2020 are expected to be 2,000 sets. FIFO inventory costing method is used.
- Raw Materials Inventory on December 31,2018, consists of 600 pounds. Direct materials requirement is 3 pounds per set. The cost is $2 per pound
- Desired ending Raw Materials Inventory is 10% of the next quarter's direct materials needed for production; desired ending inventory for December 31,2019, is 600 pounds: indirect materials are insignificant and not considered for budgeting purposes.
- Each set requires 0.30 hours of direct labor; direct labor costs average $12 per hour.
- Variable manufacturing
overhead is $3.60 per set. - Fixed manufacturing overhead includes $7,000 per quarter in depreciation and $2,585 per quarter for other costs, such as utilities, insurance, and property taxes.
- Fixed selling and administrative expenses include $11,000 per quarter for salaries; $1,500 per quarter for rent; $1,350 per quarter for insurance; and $1,500 per quarter for depreciation.
- Variable selling and administrative expenses include supplies at 2% of sales.
- Capital expenditures include $45,000 for new manufacturing equipment, to be purchased and paid for in the first quarter.
- Cash receipts for sales on account are 40% in the quarter of the sale and 60% in the quarter following the sale; Accounts Receivable balance on December 31,2018, is expected to be received in the first quarter of 2019; uncollectible accounts are considered insignificant and not considered for budgeting purposes.
- Direct materials purchases are paid 90% in the quarter purchased and 10% in the following quarter: Accounts Payable balance on December 31,2018, is expected to be paid in thefirst quarter of 2019.
- Direct labor, manufacturing overhead, and selling and administrative costs are paid in the quarter incurred.
- Income tax expense is projected at $3,500 per quarter and is paid in the quarter incurred.
- Trolley desires to maintain a minimum cash balance of $55,000 and borrows from the local bank as needed in increments of $1,000 at the beginning of the quarter; principal repayments are made at the beginning of the quarter when excess funds are available and in increments of $1,000; interest is 10% per year and paid at the beginning of the quarter based on the amount outstanding from the previous quarter.
Requirements
10. Calculate Trolley's
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Endless Mountain Company manufactures a single product that is popular with outdoor recreation enthusiasts. The company sells its product to retailers throughout the northeastern quadrant of the United States. It is in the process of creating a master budget for 2022 and reports a balance sheet at December 31, 2021 as follows:
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Endless Mountain Company manufactures a single product that is popular with outdoor recreation enthusiasts. The company sells its product to retailers throughout the northeastern quadrant of the United States. It is in the process of creating a master budget for 2022 and reports a balance sheet at December 31, 2021 as follows:
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Chapter 24 Solutions
Horngren's Accounting (12th Edition)
Ch. 24 - Prob. 1QCCh. 24 - Which is not one of the potential advantages of...Ch. 24 - The Quaker Foods division of PepsiCo is most...Ch. 24 - Which of the following is not a goal of...Ch. 24 - Which of the following balanced scorecard...Ch. 24 - The performance evaluation of a cost center is...Ch. 24 - Prob. 7QCCh. 24 - Prob. 8QCCh. 24 - Prob. 9QCCh. 24 - Prob. 10QC
Ch. 24 - Prob. 11AQCCh. 24 - Prob. 1RQCh. 24 - Prob. 2RQCh. 24 - Prob. 3RQCh. 24 - Prob. 4RQCh. 24 - Prob. 5RQCh. 24 - Prob. 6RQCh. 24 - Prob. 7RQCh. 24 - Prob. 8RQCh. 24 - Prob. 9RQCh. 24 - 10. Explain the difference between a centralized...Ch. 24 - Prob. 11RQCh. 24 - Prob. 12RQCh. 24 - Prob. 13RQCh. 24 - Prob. 14RQCh. 24 - Prob. 15RQCh. 24 - Prob. 16RQCh. 24 - List the four types of responsibility centers, and...Ch. 24 - What is a performance evaluation system?Ch. 24 - What are the goals of a performance evaluation...Ch. 24 - Prob. 20RQCh. 24 - Prob. 21RQCh. 24 - Prob. 22RQCh. 24 - Prob. 23RQCh. 24 - Prob. 24RQCh. 24 - Prob. 25RQCh. 24 - Prob. 26RQCh. 24 - Prob. 27RQCh. 24 - Prob. 28RQCh. 24 - Prob. 29RQCh. 24 - Prob. 30RQCh. 24 - Prob. 31RQCh. 24 - Prob. 32RQCh. 24 - Prob. 33RQCh. 24 - What is a transfer price?Ch. 24 - Prob. 35ARQCh. 24 - Prob. 36ARQCh. 24 - Prob. S24.1SECh. 24 - Prob. S24.2SECh. 24 - Prob. S24.3SECh. 24 - Prob. S24.4SECh. 24 - Prob. S24.5SECh. 24 - Prob. S24.6SECh. 24 - Describing the balanced scorecard and identifying...Ch. 24 - Prob. S24.8SECh. 24 - Prob. S24.9SECh. 24 - Prob. S24.10SECh. 24 - Prob. S24.11SECh. 24 - Prob. S24.12SECh. 24 - Prob. S24A.13SECh. 24 - Prob. E24.14ECh. 24 - Prob. E24.15ECh. 24 - Prob. E24.16ECh. 24 - E24-17 Computing product costs in traditional and...Ch. 24 - Identifying responsibility centers after...Ch. 24 - Prob. E24.19ECh. 24 - Prob. E24.20ECh. 24 - Prob. E24.21ECh. 24 - Prob. E24.22ECh. 24 - Prob. E24.23ECh. 24 - Prob. E24.24ECh. 24 - Prob. E24.25ECh. 24 - Prob. E24.26ECh. 24 - Prob. P24.27APGACh. 24 - Prob. P24.28APGACh. 24 - Prob. P24.29APGACh. 24 - Prob. P24.30APGACh. 24 - Prob. P24.31APGACh. 24 - Prob. P24.32BPGBCh. 24 - Prob. P24.33BPGBCh. 24 - Prob. P24.34BPGBCh. 24 - Using ROI and Rl to evaluate investment centers...Ch. 24 - Prob. P24.36BPGBCh. 24 - Prob. P24.37CTCh. 24 - Continuing Problem
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