E 19-9 Employee share purchase plan
In order to encourage employee ownership of the company's $1 par common shares, Washington Distribution permits any of its employees to buy shares directly from the company through payroll deduction. There are no brokerage fees and shares can be purchased at a 15% discount. During March, employees purchased 50,000 shares at a time when the market price of the shares on the New York Stock Exchange was $12 per share.
Required:
Prepare the appropriate journal entry to record the March purchases of shares under the employee share purchase plan.
Click here for the solution: In order to encourage employee ownership of the company's $1 par common shares, Washington Distribution permits any of its employees
Showing posts with label Order. Show all posts
Showing posts with label Order. Show all posts
Tuesday, November 10, 2015
Monday, October 26, 2015
Mabry Manufacturing Company uses a job order cost system in each of its three manufacturing departments
P2-4A Mabry Manufacturing Company uses a job order cost system in each of its three manufacturing departments. Manufacturing overhead is applied to jobs on the basis of direct labor cost in Department D, direct labor hours in Department E, and machine hours in Department K.
In establishing the predetermined overhead rates for 2008 the following estimates were made for the year.
Department
D E K
Manufacturing overhead $1,050,000 $1,500,000 $840,000
Direct labor costs $1,500,000 $1,250,000 $450,000
Direct labor hours 100,000 125,000 40,000
Machine hours 400,000 500,000 120,000
During January, the job cost sheets showed the following costs and production data.
Department
D E K
Direct materials used $140,000 $126,000 $78,000
Direct labor costs $120,000 $110,000 $37,500
Manufacturing overhead incurred $89,000 $124,000 $74,000
Direct labor hours 8,000 11,000 3,500
Machine hours 34,000 45,000 10,400
Required:
a) Compute the predetermined overhead rate for each department
b) Compute the total manufacturing costs assigned to jobs in January in each department
c) Compute the under- or overapplied overhead for each department at January 31
Click here for the solution: Mabry Manufacturing Company uses a job order cost system in each of its three manufacturing departments
In establishing the predetermined overhead rates for 2008 the following estimates were made for the year.
Department
D E K
Manufacturing overhead $1,050,000 $1,500,000 $840,000
Direct labor costs $1,500,000 $1,250,000 $450,000
Direct labor hours 100,000 125,000 40,000
Machine hours 400,000 500,000 120,000
During January, the job cost sheets showed the following costs and production data.
Department
D E K
Direct materials used $140,000 $126,000 $78,000
Direct labor costs $120,000 $110,000 $37,500
Manufacturing overhead incurred $89,000 $124,000 $74,000
Direct labor hours 8,000 11,000 3,500
Machine hours 34,000 45,000 10,400
Required:
a) Compute the predetermined overhead rate for each department
b) Compute the total manufacturing costs assigned to jobs in January in each department
c) Compute the under- or overapplied overhead for each department at January 31
Click here for the solution: Mabry Manufacturing Company uses a job order cost system in each of its three manufacturing departments
Saturday, October 17, 2015
Big Slick Oil Co., Inc., has the following account balances and other information in alphabetical order at Dec. 31, 2007
Big Slick Oil Co., Inc., has the following account balances and other information in alphabetical order at Dec. 31, 2007. All balances are as of the end of the year except Retained Earnings.
Accounts Payable.............................................$22,000
Accounts Receivable........................................$34,000
Cash................................................................ $12,000
Common Stock................................................ $50,000
Cost of Goods Sold.......................................... $120,000
Equipment, net of Accumulated Depreciation..... $60,000
Dividends......................................................... $14,000
Income Tax Expense......................................... $10,000
Interest Expense............................................... $7,000
Inventory.......................................................... $23,000
Operating Expenses.......................................... $45,000
Retained Earnings, Jan. 1, 2007........................ $19,000
Sales Revenue.................................................. $220,000
Unearned Revenue............................................ $14,000
Number of shares of stock outstanding at the end of 2007 is 10,000 shares.
Required:
Prepare an accrual basis income statement and a classified balance sheet in proper form.
Click here for the solution: Big Slick Oil Co., Inc., has the following account balances and other information in alphabetical order at Dec. 31, 2007
Accounts Payable.............................................$22,000
Accounts Receivable........................................$34,000
Cash................................................................ $12,000
Common Stock................................................ $50,000
Cost of Goods Sold.......................................... $120,000
Equipment, net of Accumulated Depreciation..... $60,000
Dividends......................................................... $14,000
Income Tax Expense......................................... $10,000
Interest Expense............................................... $7,000
Inventory.......................................................... $23,000
Operating Expenses.......................................... $45,000
Retained Earnings, Jan. 1, 2007........................ $19,000
Sales Revenue.................................................. $220,000
Unearned Revenue............................................ $14,000
Number of shares of stock outstanding at the end of 2007 is 10,000 shares.
Required:
Prepare an accrual basis income statement and a classified balance sheet in proper form.
Click here for the solution: Big Slick Oil Co., Inc., has the following account balances and other information in alphabetical order at Dec. 31, 2007
Dacher Company uses a job order cost system
Dacher Company uses a job order cost system. The following data summarize the operations related to production for October:
a. Materials purchased on account, $450,000.
b. Materials requisitioned, $425,000, of which $4,500 was for general factory use.
c. Factory labor used, $385,000, of which $95,000 was indirect.
d. Other costs incurred on account were for factory overhead, $125,400; selling expenses, $87,500; and administrative expenses, $56,400.
e. Prepaid expenses expired for factory overhead were $12,500; for selling expenses, $14,500; and for administrative expenses, $8,500.
f. Depreciation of factory equipment was $25,300; of office equipment, $31,600; and of store equipment, $7,600.
g. Factory overhead costs applied to jobs, $261,500.
h. Jobs completed, $965,000.
i. Cost of goods sold, $952,400.
Journalize the entries to record the summarized operations.
Click here for the solution: Dacher Company uses a job order cost system
a. Materials purchased on account, $450,000.
b. Materials requisitioned, $425,000, of which $4,500 was for general factory use.
c. Factory labor used, $385,000, of which $95,000 was indirect.
d. Other costs incurred on account were for factory overhead, $125,400; selling expenses, $87,500; and administrative expenses, $56,400.
e. Prepaid expenses expired for factory overhead were $12,500; for selling expenses, $14,500; and for administrative expenses, $8,500.
f. Depreciation of factory equipment was $25,300; of office equipment, $31,600; and of store equipment, $7,600.
g. Factory overhead costs applied to jobs, $261,500.
h. Jobs completed, $965,000.
i. Cost of goods sold, $952,400.
Journalize the entries to record the summarized operations.
Click here for the solution: Dacher Company uses a job order cost system
Tuesday, September 8, 2015
Finlon Upholstery, Inc. uses a job-order costing system to accumulate manufacturing costs
Finlon Upholstery, Inc. uses a job-order costing system to accumulate manufacturing costs. The company's work-in-process on December 31, 20x1, consisted of one job (no. 2077), which was carried on the year-end balance sheet at $156,800. There was no finished-goods inventory on this date.
Finlon applies manufacturing overhead to production on the basis of direct-labor cost. (The budgeted direct-labor cost is the company's practical capacity, in terms of direct-labor hours, multiplied by the budgeted direct-labor rate.) Budgeted totals for 20x2 for direct labor and manufacturing overhead are $4,200,000 and $5,460,000, respectively. Actual results for the year follow.
Direct Materials Used $5,600,000.00
Direct Labor $4,350,000.00
Indirect Material Used $65,000.00
Indirect Labor $2,860,000.00
Factory Depreciation $1,740,000.00
Factory Insurance $59,000.00
Factory Utilities $830,000.00
Selling and Administrative Expenses $2,160,000.00
Total $17,664,000.00
Job no. 2077 was completed in January 20x2; there was no work in process at year-end. All jobs produced during 20x2 were sold with the exception of job no. 2143, which contained direct material costs of $156,000 and direct-labor charges of $85,000. The company charges any under- or overapplied overhead to Cost of Goods Sold.
Directions:
1 Calculate the companies predetermined overhead application rate.
2.Calculate the additions to the work-in-process inventory account for the direct material used, direct labor and manufacturing overhead.
3.Calculate the finished goods inventory for the 12/31/x2 balance sheet.
4.Calculate the over-applied or under applied overhead at year end.
5.Explain if it is appropriate to include the selling and administrative expenses within cost of goods sold.
Click here for the solution: Finlon Upholstery, Inc. uses a job-order costing system to accumulate manufacturing costs
Finlon applies manufacturing overhead to production on the basis of direct-labor cost. (The budgeted direct-labor cost is the company's practical capacity, in terms of direct-labor hours, multiplied by the budgeted direct-labor rate.) Budgeted totals for 20x2 for direct labor and manufacturing overhead are $4,200,000 and $5,460,000, respectively. Actual results for the year follow.
Direct Materials Used $5,600,000.00
Direct Labor $4,350,000.00
Indirect Material Used $65,000.00
Indirect Labor $2,860,000.00
Factory Depreciation $1,740,000.00
Factory Insurance $59,000.00
Factory Utilities $830,000.00
Selling and Administrative Expenses $2,160,000.00
Total $17,664,000.00
Job no. 2077 was completed in January 20x2; there was no work in process at year-end. All jobs produced during 20x2 were sold with the exception of job no. 2143, which contained direct material costs of $156,000 and direct-labor charges of $85,000. The company charges any under- or overapplied overhead to Cost of Goods Sold.
Directions:
1 Calculate the companies predetermined overhead application rate.
2.Calculate the additions to the work-in-process inventory account for the direct material used, direct labor and manufacturing overhead.
3.Calculate the finished goods inventory for the 12/31/x2 balance sheet.
4.Calculate the over-applied or under applied overhead at year end.
5.Explain if it is appropriate to include the selling and administrative expenses within cost of goods sold.
Click here for the solution: Finlon Upholstery, Inc. uses a job-order costing system to accumulate manufacturing costs
Wednesday, September 2, 2015
BC Company uses a job order cost accounting system
BC Company uses a job order cost accounting system. During the month of April, the following events occurred:
(a) Purchased raw materials on credit, $32,000.
(b) Raw materials requisitioned: $25,800 as direct materials and $10,500 indirect materials.
(c) Paid factory payroll for the month totaling $37,700 which includes $8,200 indirect labor.
(d) Assigned the factory payroll to jobs and overhead.
Make the necessary journal entries to record the above transactions and events.
Click here for the solution: BC Company uses a job order cost accounting system
(a) Purchased raw materials on credit, $32,000.
(b) Raw materials requisitioned: $25,800 as direct materials and $10,500 indirect materials.
(c) Paid factory payroll for the month totaling $37,700 which includes $8,200 indirect labor.
(d) Assigned the factory payroll to jobs and overhead.
Make the necessary journal entries to record the above transactions and events.
Click here for the solution: BC Company uses a job order cost accounting system
Sunday, August 23, 2015
Ramirez Company manufactures goods to special order and uses a job order cost system
Job order cost; journal entries; ending work in process; inventory analysis
Problem 1-8 Ramirez Company manufactures goods to special order and uses a job order cost system. During its first month of operations, the following selected transactions took place:
a. Materials purchased on account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $37,000
b. Materials issued to the factory:
Job 101 $ 2,200
Job 102 5,700
Job 103 7,100
Job 104 1,700
For general use in the factory 1,350
c. Factory wages and salaries earned:
Job 101 $ 2,700
Job 102 6,800
Job 103 9,200
Job 104 2,100
For general work in the factory 2,250
d. Miscellaneous factory overhead costs on account . . . . . . . . . . . . . . . $ 2,400
e. Depreciation of $2,000 on the factory machinery recorded.
f. Factory overhead allocated as follows:
Job 101 $ 1,200
Job 102 2,000
Job 103 3,800
Job 104 1,000
g. Jobs 101, 102, and 103 completed.
h. Jobs 101 and 102 shipped to the customer and billed at $30,900.
Required:
1. Prepare a schedule reflecting the cost of each of the four jobs.
2. Prepare journal entries to record the transactions. (One control account is used for Work in Process.)
3. Compute the ending balance in Work in Process.
4. Compute the ending balance in Finished Goods.
Click here for the solution: Ramirez Company manufactures goods to special order and uses a job order cost system
Problem 1-8 Ramirez Company manufactures goods to special order and uses a job order cost system. During its first month of operations, the following selected transactions took place:
a. Materials purchased on account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $37,000
b. Materials issued to the factory:
Job 101 $ 2,200
Job 102 5,700
Job 103 7,100
Job 104 1,700
For general use in the factory 1,350
c. Factory wages and salaries earned:
Job 101 $ 2,700
Job 102 6,800
Job 103 9,200
Job 104 2,100
For general work in the factory 2,250
d. Miscellaneous factory overhead costs on account . . . . . . . . . . . . . . . $ 2,400
e. Depreciation of $2,000 on the factory machinery recorded.
f. Factory overhead allocated as follows:
Job 101 $ 1,200
Job 102 2,000
Job 103 3,800
Job 104 1,000
g. Jobs 101, 102, and 103 completed.
h. Jobs 101 and 102 shipped to the customer and billed at $30,900.
Required:
1. Prepare a schedule reflecting the cost of each of the four jobs.
2. Prepare journal entries to record the transactions. (One control account is used for Work in Process.)
3. Compute the ending balance in Work in Process.
4. Compute the ending balance in Finished Goods.
Click here for the solution: Ramirez Company manufactures goods to special order and uses a job order cost system
The following is a list (in random order) of the December 31, 2010 balance sheet accounts of the International Products Company
The following is a list (in random order) of the December 31, 2010 balance sheet accounts of the International Products Company.
Additional paid-in capital on preferred stock $ 1,600
Accounts receivable 13,800
Dividends payable 1,800
Buildings 50,000
Bonds payable (due 2016) 29,000
Retained earnings 25,800
Office supplies 1,900
Current income tax payable 4,200
Accumulation depreciation equipment 8,300
Patents (net) 2,400
Notes payable (due January 1, 2013) 17,000
Inventory 24,400
Additional paid in capital on common stock 7,700
Sinking fund for bond retirement 4,000
Accounts payable $16,500
Prepaid insurance 900
Discount on bonds payable 2,000
Common stock $10 par 15,000
Equipment 29,000
Allowance for doubtful accounts 700
Preferred stock $50 par 10,000
Accumulated depreciation Buildings 12,400
Current interest payable 2,900
Investment in held- to- Maturity bonds 9.000
Cash 8,200
Treasury stock (at cost) 1,500
Accrued wages 3,700
Land 9,500
1 .Prepare a property classified balance sheet for the International Products Company on December 31, 20101.
2. Assume instead that International Products Company uses IFRS. Prepare its balance sheet on December 31, 2010.
Click here for the solution: The following is a list (in random order) of the December 31, 2010 balance sheet accounts of the International Products Company
Additional paid-in capital on preferred stock $ 1,600
Accounts receivable 13,800
Dividends payable 1,800
Buildings 50,000
Bonds payable (due 2016) 29,000
Retained earnings 25,800
Office supplies 1,900
Current income tax payable 4,200
Accumulation depreciation equipment 8,300
Patents (net) 2,400
Notes payable (due January 1, 2013) 17,000
Inventory 24,400
Additional paid in capital on common stock 7,700
Sinking fund for bond retirement 4,000
Accounts payable $16,500
Prepaid insurance 900
Discount on bonds payable 2,000
Common stock $10 par 15,000
Equipment 29,000
Allowance for doubtful accounts 700
Preferred stock $50 par 10,000
Accumulated depreciation Buildings 12,400
Current interest payable 2,900
Investment in held- to- Maturity bonds 9.000
Cash 8,200
Treasury stock (at cost) 1,500
Accrued wages 3,700
Land 9,500
1 .Prepare a property classified balance sheet for the International Products Company on December 31, 20101.
2. Assume instead that International Products Company uses IFRS. Prepare its balance sheet on December 31, 2010.
Click here for the solution: The following is a list (in random order) of the December 31, 2010 balance sheet accounts of the International Products Company
Monday, August 17, 2015
Imperial Jewelers is considering a special order for 20 handcrafted gold bracelets to be given as gifts to members of a wedding party
Exercise 13-4 (Evaluating a Special Order) Imperial Jewelers is considering a special order for 20 handcrafted gold bracelets to be given as gifts to members of a wedding party. The normal selling price of a gold bracelet is $189.95 and its unit product cost is $149.00 as shown below:
Direct materials . . . . . . . . . . . . . . . . . . . . $ 84.00
Direct labor. . . . . . . . . . . . . . . . . . . . . . . . 45.00
Manufacturing overhead . . . . . . . . . . . . . 20.00
Unit product cost . . . . . . . . . . . . . . . . . . . $149.00
Most of the manufacturing overhead is fixed and unaffected by variations in how much jewelry is produced in any given period. However, $4.00 of the overhead is variable with respect to the number of bracelets produced. The customer who is interested in the special bracelet order would like special filigree applied to the bracelets. This filigree would require additional materials costing $2.00 per bracelet and would also require acquisition of a special tool costing $250 that would have no other use once the special order is completed. This order would have no effect on the company’s regular sales and the order could be fulfilled using the company’s existing capacity without affecting any other order.
Required:
What effect would accepting this order have on the company’s net operating income if a special price of $169.95 per bracelet is offered for this order? Should the special order be accepted at this price?
Click here for the solution: Imperial Jewelers is considering a special order for 20 handcrafted gold bracelets to be given as gifts to members of a wedding party
Direct materials . . . . . . . . . . . . . . . . . . . . $ 84.00
Direct labor. . . . . . . . . . . . . . . . . . . . . . . . 45.00
Manufacturing overhead . . . . . . . . . . . . . 20.00
Unit product cost . . . . . . . . . . . . . . . . . . . $149.00
Most of the manufacturing overhead is fixed and unaffected by variations in how much jewelry is produced in any given period. However, $4.00 of the overhead is variable with respect to the number of bracelets produced. The customer who is interested in the special bracelet order would like special filigree applied to the bracelets. This filigree would require additional materials costing $2.00 per bracelet and would also require acquisition of a special tool costing $250 that would have no other use once the special order is completed. This order would have no effect on the company’s regular sales and the order could be fulfilled using the company’s existing capacity without affecting any other order.
Required:
What effect would accepting this order have on the company’s net operating income if a special price of $169.95 per bracelet is offered for this order? Should the special order be accepted at this price?
Click here for the solution: Imperial Jewelers is considering a special order for 20 handcrafted gold bracelets to be given as gifts to members of a wedding party
Thursday, July 2, 2015
(Cash Discounts) You place an order for 350 units of inventory at a unit price of $140
(Cash Discounts) You place an order for 350 units of inventory at a unit price of $140. The supplier offers terms of 1/10, net 30.
a) How long do you have to pay before the account is overdue? If you take the full period, how much should you remit?
b) What is the discount being offered? How quickly must you pay to get
het discount? If you do take the discount how much should you remit?
c) If you don’t take the discount, how much interest are you paying implicitly? How many days’ credit are you receiving?
Click here for the solution: (Cash Discounts) You place an order for 350 units of inventory at a unit price of $140
Wednesday, June 17, 2015
Awtrey Quilting Company makes blankets that it markets through a variety of department stores
Problem 13-23 Effect of Order Quantity on Special Order Decision
Awtrey Quilting Company makes blankets that it markets through a variety of department stores. It makes the blankets in batches of 1,000 units. Awtrey made 20,000 blankets during the prior accounting period. The cost of producing the blankets is summarized here.
AND SO ON
Check:
a. Relevant Cost per Unit: $53
Click here for the solution: Awtrey Quilting Company makes blankets that it markets through a variety of department stores
Awtrey Quilting Company makes blankets that it markets through a variety of department stores. It makes the blankets in batches of 1,000 units. Awtrey made 20,000 blankets during the prior accounting period. The cost of producing the blankets is summarized here.
AND SO ON
Check:
a. Relevant Cost per Unit: $53
Click here for the solution: Awtrey Quilting Company makes blankets that it markets through a variety of department stores
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