Introduction To Managerial Accounting
8th Edition
ISBN: 9781259917066
Author: BREWER, Peter C., Garrison, Ray H., Noreen, Eric W.
Publisher: Mcgraw-hill Education,
expand_more
expand_more
format_list_bulleted
Concept explainers
Videos
Textbook Question
Chapter IE, Problem 11IE
Cost-Volume-Profit Relationships, Variable Costing
Refer to the information pertaining to Endless Mountain Company that is provided in Integration Exercise 8. In addition to the budget schedules that you prepared in Integration Exercise 8, insert two new tabs in your Microsoft Excel worksheet titled “CVP Analysis” and “Variable Costing.”
Required (For all questions, be sure to use formulas that link to the other tabs in your Microsoft Excel worksheet when performing your calculations):
1. Calculate the following budgeted figures for 2017:
a. The total fixed cost.
b.The variable cost per unit sold.
c. The contribution margin per unit sold.
d. The break-even point in unit sales and dollar sales.
e.The margin of safety.
f The degree of operating leverage.
2. Calculate the following budgeted figures for 2017:
a. A variable costing income statement. Stop your computations at net operating income.
b. A reconciliation that explains the difference in the absolution costing and variable costing net operating incomes.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Convert the accompanying database to an Excel table to find:
a.The total cost of all orders.
b.Thetotal quantity of airframe fasteners purchased.
c. The total cost of all orders placed with Manley Valve.
Question content area bottom
Part 1
a. The total cost of all orders is
$?????? enter your response here.
Applying Excel - Data Visualization: Exercise (Part 2 of 2)
On the Data Visualization - Student tab in your Excel spreadsheet, update the price per unit for all four products for Office Warehouse
Inc. with the data below:
Products Available
Paper
Pens
Sticky Notes
Envelopes
Required:
Create a Pivot Table and determine the following information while analyzing the data:
2. Which product has the highest total units ordered and the highest total sales? (Enter your Units Ordered to the nearest whole unit
and your Total Sales to 2 decimal places.)
Units Ordered
Total Sales
Price per Unit
$20.00 per case:
$ 9.00 per box
$9.00 per package
$ 4.50 per box
Product
Total
docs.google.com/forms/d/e
Q 1/ Answer The Following Questions
* :Cost objects include .1
products
customers
departments
All of above answers are correct.
The general term used to identify both .2
the tracing and the allocation of
* :accumulated costs to a cost object is
cost accumulation
cost assignment
cost tracing
conversion costing
:Budgeted costs are .3
II
Chapter IE Solutions
Introduction To Managerial Accounting
Ch. IE - INTEGRATION EXERCISE I Different Costs for...Ch. IE - Absorption Costing, Variable Costing, Cost,...Ch. IE - Cash Budget, Income Statement, Balance Sheet,...Ch. IE - Prob. 4IECh. IE - Plantwide and Departmental Overhead Allocation;...Ch. IE - Normal Costing versus Actual Costing Darwin...Ch. IE - Prob. 7IECh. IE - Master Budgeting Endless Mountain Company...Ch. IE - Statement of Cash Flows Refer to the information...Ch. IE - Financial Statement Ratio Analysis Refer to the...
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
- 1. Assign Overhead Costs to Activity Cost Pools 国日 First-Stage Allocation to Activity Cost Pools - Excel Sign In FILE HOME INSERT PAGE LAYOUT FORMULAS DATA REVIEW VIEW Calibri -A A 10 Paste BIU - A - Alignment Number Conditional Format as Cell Cells Formatting - Table - Styles - Clipboard Font Styles A1 fx A C E F G 1 == 2 Total costs and distribution of resource consumption across activity cost pools: 3 4 Activity Cost Pools Customer Product Customer Total Cost Orders Development Relations Other Total 6 Production Department: 7 Indirect factory wages $ 400,000 50% 30% 15% 5% 100% Factory equipment depreciation Factory utilities 10 Factory property taxes and insurance 8 150,000 55% 30% 0% 15% 100% 9 120,000 59% 34% 0% 7% 100% 75,000 57% 33% 0% 10% 100% 11 12 General Administrative Department: Administrative wages and salaries Office equipment depreciation 13 275,000 20% 10% 40% 30% 100% 14 40,000 32% 16% 15% 37% 100% 15 Administrative property taxes and insurance 60,000 0% 0% 0% 100%…arrow_forwardWhat I Know Before we begin this lesson, let us check first your prior knowledge on this module. After taking and checking this short test, take note of the items that you are not able to answer correctly and look for the right answer as you go through this module. Direction: Encircle the letter of the correct answer. 1. What type of cost includes product ingredients and materials? а. fixed b. revenue с. total d. variable 2. What type of cost includes the rental of space? а. fixed b. revenue c. total d. variable 3. What type of cost is the product of the price and the quantity sold? а. fixed b. revenue с. total d. variable 4. What concept is being described when the business will neither earn a profit nor suffer a loss? а. break-even b. loss с. profit d. summit 5. What type of analysis shows equal revenue and total cost? а. break-even b. cost of variable c. profit-loss d. volume of salesarrow_forwardOn the Data Tables - Student tab in your Excel spreadsheet, update the given information section of the Income Statement for Hello Company with the data below: Units Price per unit Variable expense per unit Total Fixed Costs Income Statement SCENARIO 1 Product A Product B Product C Required: 2. Using the Data Table What-if Analysis tool in Excel, determine the Units and Operating Income (Loss) for each product based on the following scenarios. (Hint: Don't forget that the warehouse can only hold up to 45,000 units.) Scenario 1: Pete wants to find the mix of units that will result in the highest overall Operating Income, perform this analysis using a two variable data table. Product A can vary between 32,000 units and a maximum of 37.000 units. Product B can vary between 5,000 units and a maximum of 10,000 units. Both Products A and B are manufactured in 1,000-unit increments. The production level of Product C is the same each month at 3,000 units. SCENARIO 2 Product A Product B Product…arrow_forward
- Time-Driven Activity-Based Budgeting (TDABB) The company for which you work recentlyimplemented time-driven activity-based costing (TDABC) in conjunction with its enterpriseresource planning (ERP) system. Management is pleased with the revised product and customer costinformation that the TDABC system produces. It is now wondering how this system can be used forbudgeting purposes. You have been asked to provide an example of using time-driven activity-basedbudgeting, given the following information:1. There are two resources (departments): indirect labor and computer support.2. There are two primary activities that these resources support: handling production runs andproduct-level support.3. Indirect labor support is consumed as follows:a. To handle production runs: 10 hours/run.b. To support products: 500 hours/product.4. Computer support is consumed as follows:a. To handle production runs: 0.4 hour/run.b. To support products: 50 hours/product.5. Resource practical capacity levels:a.…arrow_forwardChapter 2 (Continued): Basic Cost Management Concepts College offers students a number of different majors and disciplines. These majors and disciplines have department chairpersons who are responsible for the department budget preparation. Please define direct costs and indirect costs and then prepare a list of three direct and three indirect costs for the Accounting Department at College. Hint: See Exercise 10 in Chapter 2 of your eText.arrow_forwardThe Chapter 6 Form worksheet is to be used to create your own worksheet version of the Review Problem in the text. 2. Change all of the numbers in the data area of your worksheet so that it looks like this: If your formulas are correct, you should get the correct answers to the following questions. (a) What is the net operating income (loss) in Year 1 under absorption costing? (b) What is the net operating income (loss) in Year 2 under absorption costing? (c) What is the net operating income (loss) in Year 1 under variable costing? (d) What is the net operating income (loss) in Year 2 under variable costing? (e) The net operating income (loss) under absorption costing is less than the net operating income (loss) under variable costing in Year 2 because: (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer.…arrow_forward
- ezto.mheducation.com Homework: Cost Management and Allocation Assignment Question 7- Homework: Cost Management and Allocation Assignment- Connect Homework: Cost Management and Allocation Assignm... i Saved Help Save & Exit Submit Check my work State Financial Corp. has three service departments (Administration, Communications, and Facilities), and two production departments (Deposits and Loans). A summary of costs and other data for each department prior to allocation of service department costs for the year ended December 31 follows. 4. points Administration Communications Facilities Deposits $8,320,000 $4,600,000 447, 000 Loans Direct costs $200,000 24,000 $290,000 31,000 $253,000 20,500 Employee hours Number of employees Square footage occupied Skipped 360,000 8. 14 6. 230 130 4,600 13,800 5,100 244, 100 203,300 The costs of the service departments are allocated on the following bases: Administration, employee-hours; Communications, number of employees; and Facilities, square…arrow_forwardIda Company produces a handcrafted musical instrument called a gamelan that is similar to a xylophone. The gamelans are sold for $880. Selected data for the company's operations last year follow: Units in beginning inventory Units produced Units sold 280 240 Units in ending inventory Variable costs per unit: 40 Direct materials 115 2$ 2$ 2$ Direct labor 335 Variable manufacturing overhead Variable selling and administrative Fixed costs: 35 25 Fixed manufacturing overhead Fixed selling and administrative $ 63,000 $ 23,000 The absorption costing income statement prepared by the company's accountant for last year appears below: $ 211,200 170,400 40,800 29,000 Sales Cost of goods sold Gross margin Selling and administrative expense Net operating income $ 11,800 Required: 1. Under absorption costing, how much fixed manufacturing overhead cost is included in the company's inventory at the end of last year? 2. Prepare an income statement for last year using variable costing.arrow_forwardInstructions: Read and analyze the scenario below. Write your answers on the spaces provided. In the Interesting box, write down how each costing method would contribute in achieving the main objective of Expedia Industries. In the My Decision box, write down your Recta recommendation about the most effective costing approach that will resolve the problem in the given scenario using one (1) between the two (2) costing methods being compared. Scenario: Expedia Industries Expedia Industries is the largest supplier and manufacturer of modern women's clothing in the United States. The main objective of the company is to establish a costing procedure that will monitor the inflow and outflow of their raw materials relative in their production of clothes. The board members of the company have separate views in employing FIFO costing method or the Moving Average costing method since according to most of them, their major raw material which is cotton doesn't even have an expiration date, and…arrow_forward
- Home * CengageNOWv2 | Online teachin x +. takeAssignment/takeAssignmentMain.do?invoker=&takeAssignmentSessionLocator=&inprogress=false eBook Show Me How E Print Item Flexible Budget for Selling and Administrative Expenses for a Service Company Digital Solutions Inc. uses flexible budgets that are based on the following data: Sales commissions 8% of sales Advertising expense 15% of sales Miscellaneous administrative expense $10,000 per month plus 4% of sales Office salaries expense $50,000 per month Customer support expenses $20,000 per month plus 30% of sales Research and development expense $75,000 per month Prepare a flexible selling and administrative expenses budget for October for sales volumes of $500,000, $750,000, and $1,000,000. (Use Exhibit 5 as a model.) Digital Solutions Inc. Flexible Selling and Administrative Expenses Budget For the Month Ending October 31 Total sales $500,000 $750.000 $1,000,000 Variable cost: Sales commissions Advertising expense Miscellaneous…arrow_forwardFile Edit View History Bookmarks Window Help System (Academic) A elearn.squ.edu.om erial Accounting || fall20 Which one of the following is correct about variable costing systems? Select one: 1 a. Normally result into a lower product cost compared to absorption costing systems b. Calculate product cost as the sum of directs materials, direct labor, manufacturing overhead costs, and selling cost c. Calculate product cost as the sum of directs materials, direct labor and manufacturing overhead costs d. Focuses on both variable and fixed costs.arrow_forwardMatch each of the following cost items with the value chain business function where you would expect the cost to be incurred: Cost Item 1. Purchase of raw materials 2. Advertising 3. Salary of research scientists 4. Delivery expenses 5. Reengineering of product assembly process 6. Replacement labor expense for warranty repairs 7. Manufacturing supplies 8. Sales salaries 9. Purchase of CAD (computer-aided design) software 10. Salary of website manager Business Functionarrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Principles of Cost AccountingAccountingISBN:9781305087408Author:Edward J. Vanderbeck, Maria R. MitchellPublisher:Cengage Learning
Excel Applications for Accounting PrinciplesAccountingISBN:9781111581565Author:Gaylord N. SmithPublisher:Cengage Learning
Principles of Cost Accounting
Accounting
ISBN:9781305087408
Author:Edward J. Vanderbeck, Maria R. Mitchell
Publisher:Cengage Learning
Excel Applications for Accounting Principles
Accounting
ISBN:9781111581565
Author:Gaylord N. Smith
Publisher:Cengage Learning
Cost Accounting - Definition, Purpose, Types, How it Works?; Author: WallStreetMojo;https://www.youtube.com/watch?v=AwrwUf8vYEY;License: Standard YouTube License, CC-BY