Managerial Accounting (5th Edition)
5th Edition
ISBN: 9780134128528
Author: Karen W. Braun, Wendy M. Tietz
Publisher: PEARSON
expand_more
expand_more
format_list_bulleted
Concept explainers
Question
Chapter 5, Problem 5.3SE
1.
To determine
The method of costing to be adopted by the company between process costing and job costing in the manufacture of candies.
2.
To determine
To provide: The examples for the given terms in the process of manufacturing candies.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
Your friend, Suzie Chang, has designed a new type of outdoor toy that helps children learn basic concepts such as colors, numbers,
and shapes. Suzie's product will target two groups: day care centers in warm climates and home school programs. Her company is
Jiffy Jet and costs for last month follow.
Factory rent
Company advertising
Wages paid to assembly workers
Depreciation for salespersons' vehicles
Screws
Utilities for factory
Assembly supervisor's salary
Sandpaper
President's salary
Plastic tubing
Paint
Sales commissions
Factory insurance
Req 1 and 2
$ 3,050
1,050
30,600
2,200
580
880
1,210
1,060
Depreciation on cutting machines
2,090
Wages paid to painters
8,150
Assume that Suzie Chang has decided to begin production of her outdoor children's toy.
Required:
1 & 2. Identify each of the preceding costs as either a product or a period cost. If the cost is a product cost, decide whether it is for
direct materials (DM), direct labor (DL), or manufacturing overhead (MOH) and also…
Your friend, Suzie Whitson, has designed a new type of outdoor toy that helps children learn basic concepts such as colors, numbers, and shapes. Suzie’s product will target two groups: day care centers in warm climates and home school programs. Her company is Jiffy Jet and costs for last month follow:
Factory rent
$
3,050
Company advertising
1,170
Wages paid to assembly workers
31,200
Depreciation for salespersons’ vehicles
2,100
Screws
510
Utilities for factory
825
Assembly supervisor’s salary
3,520
Sandpaper
160
President’s salary
5,040
Plastic tubing
4,090
Paint
240
Sales commissions
1,240
Factory insurance
1,150
Depreciation on cutting machines
2,140
Wages paid to painters
7,900
Assume that Suzie Whitson has decided to begin production of her outdoor children’s toy.
Required:1 and 2. Identify each of the preceding costs as either a product or a period cost. If the cost is a product cost, decide whether it…
2.The company "Chanos Ltd" produces puzzles for adults within the framework of a standardized mass production. The production process uses 2 basic raw materials: cardboard and high quality ink. For the manufacture of a puzzle, half a square meter of cardboard and 0.1 kg of ink are required. The cardboard is inserted at the beginning of the production process and the ink is added at the end by printing the design on the now perforated puzzle. The company uses the cost flow assumption F.I.F.O. to value its inventories.
Here are some data for the month of August 20X6:
The initial stock of semi-finished on 1/8/20X6 was 2,000 puzzles processed at 20% in terms of conversion costs. The cost of the initial stock amounted to €28,000 in terms of cardboard costs and €35,000 in terms of conversion costs.
The conversion cost for the month amounted to € 20,300.
The final stock of semi-finished on 31/8/20X6 was 3,000 puzzles processed at 40% in terms of conversion costs.
Data are also given…
Chapter 5 Solutions
Managerial Accounting (5th Edition)
Ch. 5 - (Learning Objective 1) Which of the following is...Ch. 5 - (Learning Objective 2) Conversion costs consist of...Ch. 5 - (Learning Objective 2) Which of the following is...Ch. 5 - (Learning Objective 3) Which of the following is...Ch. 5 - Prob. 5QCCh. 5 - (Learning Objective 4) The journal entry needed to...Ch. 5 - (Learning Objective 4) A company has two...Ch. 5 - Prob. 8QCCh. 5 - Prob. 9QCCh. 5 - Prob. 10QC
Ch. 5 - Compare job costing and process costing (Learning...Ch. 5 - Prob. 5.2SECh. 5 - Prob. 5.3SECh. 5 - Determine the physical flow of units (process...Ch. 5 - Compute equivalent units (process costing Step 2)...Ch. 5 - Compute equivalent units (process costing Step 2)...Ch. 5 - Summarize total costs to account for (process...Ch. 5 - Prob. 5.8SECh. 5 - Prob. 5.9SECh. 5 - Prob. 5.10SECh. 5 - Prob. 5.11SECh. 5 - Prob. 5.12SECh. 5 - Prob. 5.13SECh. 5 - Prob. 5.14SECh. 5 - Prob. 5.15SECh. 5 - Prob. 5.16SECh. 5 - Continuation of S5-16: Record journal entry and...Ch. 5 - Compute equivalent units in second department...Ch. 5 - Prob. 5.19SECh. 5 - Prob. 5.20SECh. 5 - Prob. 5.21SECh. 5 - Prob. 5.22SECh. 5 - Analyze flow of costs through inventory T-accounts...Ch. 5 - Summarize physical units and compute equivalent...Ch. 5 - Prob. 5.25AECh. 5 - Prob. 5.26AECh. 5 - Continuation of E5-26A: Journal entries (Learning...Ch. 5 - Complete the production cost report in first...Ch. 5 - Prob. 5.29AECh. 5 - Analyze costs and gross profit in a process...Ch. 5 - Prob. 5.31AECh. 5 - Compute equivalent units and assign costs...Ch. 5 - Complete five-step procedure in first department...Ch. 5 - Sustainability and process costing (Learning...Ch. 5 - Complete five-step procedure and journalize result...Ch. 5 - Complete five-step procedure in second department...Ch. 5 - Exercises Group B E5-37B Analyze flow of costs...Ch. 5 - Summarize physical units and compute equivalent...Ch. 5 - Prob. 5.39BECh. 5 - Complete five-step procedure in first department...Ch. 5 - Prob. 5.41BECh. 5 - Prob. 5.42BECh. 5 - Prob. 5.43BECh. 5 - Prob. 5.44BECh. 5 - Record journal entries (Learning Objective 4)...Ch. 5 - Compute equivalent units and assign costs...Ch. 5 - Prob. 5.47BECh. 5 - Sustainability and process costing (Learning...Ch. 5 - Complete five-step procedure and journalize result...Ch. 5 - Complete five-step procedure in second department...Ch. 5 - Process costing in a single processing department...Ch. 5 - Process costing in a first department (Learning...Ch. 5 - Prob. 5.53APCh. 5 - Prepare a production cost report and journal...Ch. 5 - Prob. 5.55APCh. 5 - Process costing in a single processing department...Ch. 5 - Process costing in a first department (Learning...Ch. 5 - Prob. 5.58BPCh. 5 - Prepare a production cost report and journal...Ch. 5 - Prob. 5.60BPCh. 5 - Prob. 5.61SCCh. 5 - Discussion Questions 1. What characteristics of...Ch. 5 - Prob. 5.63ACTCh. 5 - Prob. 5.64ACTCh. 5 - Process costing and hybrid costing issues...
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
- Clearview Window Company manufactures windows for the home-building industry. The window frames are produced in the Frame Division. The frames are then transferred to the Glass Division, where the glass and hardware are installed. The company’s best-selling product is a three-by-four-foot, doublepaned operable window. The Frame Division also can sell frames directly to custom home builders, who install the glass and hardware. The sales price for a frame is $80. The Glass Division sells its finished windows for $190. The markets for both frames and finished windows exhibit perfect competition. The standard variable cost of the window is detailed as follows: Frame Division Glass Division Direct material $ 15 $ 30 * Direct labor 20 15 Variable overhead 30 30 Total $ 65 $ 75 *Not including the transfer price for the frame. Assume that there is no excess capacity in the Frame Division. Required: 1-a. Use the general rule to compute the transfer price for window frames. 1-b. Calculate the…arrow_forwardSummary Harvesting cocoa, an essential ingredient in chocolate, is a labor intensive task. Cocoa pods are opened with a machete, and the beans inside are removed and then dried to be turned into the cocoa that is used in the production of chocolate. Much of the world’s cocoa comes from countries in Africa like Ghana and the Ivory Coast, countries located near the equator where growing conditions are ideal. The labor intensive nature of harvesting the beans has led many producers to turn to children as a source of labor, and often to child slave labor. The public outcry over the situation has prompted some chocolate producers to turn to Fair Trade cooperatives for their cocoa. These groups of farmers have committed to eliminating the use of child labor especially child slave labor. In doing so, however, their cost of production has risen and so has the cost of their final product. Both large companies like Cadbury, Nestle, and Mars as well as smaller chocolate producers are…arrow_forwardMuffin Factory (MF) bakes and sells muffins. MF buys materials from suppliers and bakes, frosts, and packages them for resale. Currently the firm offers 2 different types of muffins to gourmet bake shops in boxes, each containing a dozen muffins. The major cost is direct materials; however, a substantial amount of factory overhead is incurred in the baking, frosting, and packing process. MF prices its muffins at full product cost, including allocated overhead, plus a markup of 40%. Data for the current budget include factory overhead of $919,400, which has been allocated by its current costing system on the basis of each product’s direct labor cost. The budgeted direct labor cost for the current year totals $300,000. The budgeted direct costs for a one-dozen box of two of the company’s most popular muffins are as follows: Costs per one dozen Blueberry Cinnamon Activity Cost Driver Budgeted Activity Budgeted Cost Direct materials $…arrow_forward
- Avenger Toy Shop produces and sells children’s toys such as puzzles and tents which help the development of young minds. The shop plan to produce and sell a new toy, Knitted Baby Rattle for their new target customers. The estimated production costs are as follows: Two types of materials are required to produce a new toy, Direct and Indirect Materials. Costs of Direct Materials is RM3 per meter while Indirect Materials cost RM4 per meter. Each unit toy uses two (2) meters of Direct Materials and four (4) meters of Indirect Materials. The Labour cost per unit is RM12. Overhead costs are RM10 per unit. Based on a market survey, competitors sell this product at a selling price of RM50. The new toy’s target return on sales is 20%. Determine the target cost per unit of the toy. Calculate the cost gap per unit of the toy.arrow_forwardBoney Corporation processes sugar beets that it purchases from farmers. Sugar beets are processed in batches. A batch of sugar beets costs $54 to buy from farmers and $11 to crush in the company's plant. Two intermediate products, beet fiber and beet juice, emerge from the crushing process. The beet fiber can be sold as is for $16 or processed further for $15 to make the end product industrial fiber that is sold for $66. The beet juice can be sold as is for $49 or processed further for $19 to make the end product refined sugar that is sold for $66. What is the financial advantage (disadvantage) for the company from processing the intermediate product beet juice into refined sugar rather than selling it as is? Multiple Choice O ($33) ($2) ($21) ($75)arrow_forwardBoney Corporation processes sugar beets that it purchases from farmers. Sugar beets are processed in batches. A batch of sugar beets costs $53 to buy from farmers and $18 to crush in the company's plant. Two intermediate products, beet fiber and beet juice, emerge from the crushing process. The beet fiber can be sold as is for $25 or processed further for $18 to make the end product industrial fiber that is sold for $39. The beet juice can be sold as is for $32 or processed further for $28 to make the end product refined sugar that is sold for $79. What is the financial advantage (disadvantage) for the company from processing the intermediate product beet juice into refined sugar rather than selling it as is?arrow_forward
- Boney Corporation processes sugar beets that it purchases from farmers. Sugar beets are processed in batches. A batch of sugar beets costs $65 to buy from farmers and $24 to crush in the company's plant. Two intermediate products, beet fiber and beet juice, emerge from the crushing process. The beet fiber can be sold as is for $35 or processed further for $39 to make the end product industrial fiber that is sold for $87. The beet juice can be sold as is for $56 or processed further for $43 to make the end product refined sugar that is sold for $87. What is the financial advantage (disadvantage) for the company from processing one batch of sugar beets into the end products industrial fiber and refined sugar rather than not processing that batch at all?arrow_forwardStinehelfer Beet Processors, Inc., processes sugar beets in batches. A batch of sugar beets costs $56 to buy from farmers and $13 to crush in the company's plant. Two intermediate products, beet fiber and beet juice, emerge from the crushing process. The beet fiber can be sold as is for $24 or processed further for $12 to make the end product industrial fiber that is sold for $31. The beet juice can be sold as is for $43 or processed further for $29 to make the end product refined sugar that is sold for $91. What is the financial advantage (disadvantage) for the company from processing the intermediate product beet juice into refined sugar rather than selling it as is? Multiple Choice ($50) ($16) $6 $19 身arrow_forwardStinehelfer Beet Processors, Inc., processes sugar beets in batches. A batch of sugar beets costs $56 to buy from farmers and $13 to crush in the company's plant. Two intermediate products, beet fiber and beet juice, emerge from the crushing process. The beet fiber can be sold as is for $24 or processed further for $12 to make the end product industrial fiber that is sold for $31. The beet juice can be sold as is for $43 or processed further for $29 to make the end product refined sugar that is sold for $91. What is the financial advantage (disadvantage) for the company from processing the intermediate product beet juice into refined sugar rather than selling it as is? Multiple Choicearrow_forward
- Quality Clothing, Inc., produces skorts and jumper uniforms for schoolchildren. In the process of cutting out the cloth pieces for each product, a certain amount of scrap cloth is produced. Quality has been selling this cloth scrap to Jorges Scrap Warehouse for $3.25 per pound. Last year, the company sold 40,000 lb. of scrap, which would be enough to make 10,000 teddy bears that the management of Quality is now interested in producing. Their processes would need some reprogramming, particularly in the cutting and stitching processes, but it would require no additional worker training. However, new packaging would be needed. The total variable cost to produce the teddy bears $3.85. Fixed costs would increase by $95,000 per year for the lease of the packaging equipment and Quality estimates it could produce and sell 10,000 teddy bears per year. Finished teddy bears could be sold for $18.00 each. Should Quality continue to sell the scrap cloth or should Quality process the scrap into teddy bears to sell?arrow_forwardKosakowski Corporation processes sugar beets in batches. A batch of sugar beets costs $66 to buy from farmers and $17 to crush in the company's plant. Two intermediate products, beet fiber and beet juice, emerge from the crushing process. The beet fiber can be sold as is for $23 or processed further for $13 to make the end product industrial fiber that is sold for $36. The beet juice can be sold as is for $42 or processed further for $20 to make the end product refined sugar that is sold for $84. How much more profit (loss) does the company make by processing one batch of sugar beets into the end products industrial fiber and refined sugar? Select one: a. $22 b. ($18) c. ($116) d. $4arrow_forwardStinehelfer Beet Processors, Inc., processes sugar beets in batches. A batch of sugar beets costs $39 to buy from farmers and $13 to crush in the company's plant. Two intermediate products, beet fiber and beet juice, emerge from the crushing process. The beet fiber can be sold as is for $21 or processed further for $13 to make the end product industrial fiber that is sold for $33. The beet juice can be sold as is for $41 or processed further for $37 to make the end product refined sugar that is sold for $73. What is the financial advantage (disadvantage) for the company from processing the intermediate product beet juice into refined sugar rather than selling it as is?arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Principles of Accounting Volume 2AccountingISBN:9781947172609Author:OpenStaxPublisher:OpenStax College
Principles of Accounting Volume 2
Accounting
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax College
Cost Accounting - Definition, Purpose, Types, How it Works?; Author: WallStreetMojo;https://www.youtube.com/watch?v=AwrwUf8vYEY;License: Standard YouTube License, CC-BY