Principles of Cost Accounting
17th Edition
ISBN: 9781305087408
Author: Edward J. Vanderbeck, Maria R. Mitchell
Publisher: Cengage Learning
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Chapter 7, Problem 7E
Starburst Inc. has the following items and amounts as part of its
Determine the total dollar amounts for the above items that would appear in a flexible budget at the following volume levels, assuming that both levels are within the relevant range:
- a. 8,000-unit level of sales and production
- b. 12,000-unit level of sales and production (Hint: You must first determine the unit selling price and certain unit costs.)
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Refer to the information regarding Stillwater Designs above.Required:1. Prepare a sales budget for each quarter of 20X1 and for the year in total. Show sales byproduct and in total for each time period.2. CONCEPTUAL CONNECTION How will Stillwater Designs use this sales budget?
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Westport Company is preparing its master budget for May. Use the estimates provided to determine the amounts necessary for each of the following requirements. (Estimates may be related to more than one requirement.)
a. What should total sales revenue be if territories E and W estimate sales of 50,000 and 100,000 units, respectively, and the unit selling price is $35?
b. If the beginning finished goods inventory is an estimated 6,000 units and the desired ending inventory is 8,000 units, how many units should be produced?Answer units
c. What dollar amount of materials should be purchased at $2.50 per pound if each unit of product requires 2.5 pounds and beginning and ending materials inventories should be 12,000 and 13,500 pounds, respectively.
d. How much direct labor cost should be incurred if each unit produced requires 0.5 hours at an hourly rate of $16?
e. How much manufacturing overhead should be incurred if fixed manufacturing overhead is $45,000 and variable manufacturing…
Chapter 7 Solutions
Principles of Cost Accounting
Ch. 7 - Prob. 1QCh. 7 - Prob. 2QCh. 7 - Prob. 3QCh. 7 - Prob. 4QCh. 7 - Explain zero-based budgeting and how it differs...Ch. 7 - Prob. 6QCh. 7 - Which operating budget must be prepared before the...Ch. 7 - Prob. 8QCh. 7 - Why is it important to have front-line managers...Ch. 7 - If the sales forecast estimates that 50,000 units...
Ch. 7 - What are the advantages and disadvantages of each...Ch. 7 - What three operating budgets can be prepared...Ch. 7 - Prob. 13QCh. 7 - What are the three budgets that are needed in...Ch. 7 - Why might Web-based budgeting be more useful than...Ch. 7 - What is a flexible budget?Ch. 7 - Why is a flexible budget better than a master...Ch. 7 - Why is it important to distinguish between...Ch. 7 - Why is the concept of relevant range important...Ch. 7 - In comparing actual sales revenue to flexible...Ch. 7 - How would you define the following? a. Theoretical...Ch. 7 - Is it possible for a factory to operate at more...Ch. 7 - If a factory operates at 100% of capacity one...Ch. 7 - How is the standard cost per unit for factory...Ch. 7 - When allocating service department costs to...Ch. 7 - The sales department of Macro Manufacturing Co....Ch. 7 - The sales department of F. Pollard Manufacturing...Ch. 7 - Barnes Manufacturing Co. forecast October sales to...Ch. 7 - Prepare a cost of goods sold budget for the Crest...Ch. 7 - Prepare a cost of goods sold budget for MacLaren...Ch. 7 - Roman Inc. has the following totals from its...Ch. 7 - Starburst Inc. has the following items and amounts...Ch. 7 - Using the following per-unit and total amounts,...Ch. 7 - Cortez Manufacturing, Inc. has the following...Ch. 7 - Prob. 10ECh. 7 - Prob. 11ECh. 7 - Prob. 12ECh. 7 - Prob. 13ECh. 7 - Calculating factory overhead The normal capacity...Ch. 7 - The Sales Department of Minimus Inc. has forecast...Ch. 7 - Sales, production, direct materials, direct labor,...Ch. 7 - Budgeted selling and administrative expenses for...Ch. 7 - Prob. 4PCh. 7 - Selling and administrative expense budget and...Ch. 7 - Preparing a flexible budget Use the information in...Ch. 7 - Preparing a performance report Use the flexible...Ch. 7 - Preparing a performance report Use the flexible...Ch. 7 - Flexible budget for factory overhead Presented...Ch. 7 - Prob. 10PCh. 7 - Overhead application rate Creole Manufacturing...Ch. 7 - Overhead application rate Roll Tide Manufacturing...Ch. 7 - Flexible budgeting, performance measurement, and...
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