Copa Company, a manufacturer of stereo systems, started its production in October 2008 (ACC 560 Week 2)

ACC 560 Week 2 Assignment

P1-2A Copa Company, a manufacturer of stereo systems, started its production in October 2008. For the preceding 3 years Copa had been a retailer of stereo systems. After a thorough survey of stereo system markets, Copa decided to turn its retail store into a stereo equipment factory.

Raw materials cost for a stereo system will total $74 per unit. Workers on the production lines are on average paid $12 per hour. A stereo system usually takes 5 hours to complete. In addition, the rent on the equipment used to assemble stereo systems amounts to $4,900 per month. Indirect materials cost $5 per system. A supervisor was hired to oversee production; her monthly salary is $3,000.

Janitorial costs are $1,300 monthly. Advertising costs for the stereo system will be $8,500 per month. The factory building depreciation expense is $7,200 per year. Property taxes on the factory building will be $9,000 per year.

Required:
(a) Prepare an answer sheet. Assuming that Copa manufactures, on average, 1,300 stereo systems per month, enter each cost item on your answer sheet, placing the dollar amount per month under the appropriate headings. Total the dollar amounts in each of the columns.
(b) Compute the cost to produce one stereo system.

Click here for the solution: Copa Company, a manufacturer of stereo systems, started its production in October 2008 (ACC 560 Week 2)

Brainiac Company purchased a delivery truck for $30,000 on January 1, 2011 (ACC 291 Week 2 Assignment)

ACC 291 Week 2 Assignment

E9-7 Brainiac Company purchased a delivery truck for $30,000 on January 1, 2011. The truck has a expected salvage value of 2,000 and is expected to be driven 100,000 miles over its estimated useful life of 8 years. Actual miles driven were 15,000 in 2011 and 12,000 in 2012.

Instructions
a) compute depreciation expense for 2010 and 2011 using (1) the straight line method (2) the units of activity method and (3) the double declining balance method.
b) Assume that Brainiac uses the straight line method
(1) prepare the journal entry to record 2010 depreciation.
(2) Show how the truck would be reported in the December 31, 2010 balance sheet.


Click here for the solution: Brainiac Company purchased a delivery truck for $30,000 on January 1, 2011

(Qualitative Characteristics) The qualitative characteristics that make accounting information useful for decision-making purposes are as follows

Exercise 2-2 (E2-2). Qualitative Characteristics. The qualitative characteristics that make accounting information useful for decision-making purposes are as follows.

Relevance Timeliness Representational faithfulness
Reliability Verifiability Comparability
Predictive value Neutrality Consistency
Feedback value

Instructions
Identify the appropriate qualitative characteristic(s) to be used given the information provided below.
(a) Qualitative characteristic being employed when companies in the same industry are using the same accounting principles.
(b) Quality of information that confirms users' earlier expectations.
(c) Imperative for providing comparisons of a company from period to period.
(d) Ignores the economic consequences of a standard or rule.
(e) Requires a high degree of consensus among individuals on a given measurement.
(f) Predictive value is an ingredient of this primary quality of information.
(g) Two qualitative characteristics that are related to both relevance and reliability.
(h) Neutrality is an ingredient of this primary quality of accounting information.
(i) Two primary qualities that make accounting information useful for decision-making purposes
(j) Issuance of interim reports is an example of what primary ingredient of relevance

Click here for the solution: (Qualitative Characteristics) The qualitative characteristics that make accounting information useful for decision-making purposes are as follows

Exercise 2-4 (E2-4) (Assumptions, Principles, and Constraints) Presented below are the assumptions, principles, and constraints used in this chapter

ACC 421 Week Two (Week 2)

Exercise 2-4 (E2-4) (Assumptions, Principles, and Constraints) Presented below are the assumptions, principles, and constraints used in this chapter.
1. Economic entity assumption 5. Historical cost principle 9. Materiality
2. Going concern assumption 6. Matching principle 10. Industry practices
3. Monetary unit assumption 7. Full disclosure principle 11. Conservatism
4. Periodicity assumption 8. Cost-benefit relationship

Instructions
Identify by number the accounting assumption, principle, or constraint that describes each situation below. Do not use a letter more than once.
(a) Allocates expenses to revenues in the proper period.
(b) Indicates that market value changes subsequent to purchase are not recorded in the accounts. (Do not use revenue recognition principle.)
(c) Ensures that all relevant financial information is reported.
(d) Rationale why plant assets are not reported at liquidation value. (Do not use historical cost principle.)
(e) Anticipates all losses, but reports no gains.
(f) Indicates that personal and business record keeping should be separately maintained.
(g) Separates financial information into time periods for reporting purposes.
(h) Permits the use of market value valuation in certain specific situations.
(i) Requires that information significant enough to affect the decision of reasonably informed users should be disclosed. (Do not use full disclosure principle.)
(j) Assumes that the dollar is the “measuring stick” used to report on financial performance.

Click here for the solution: Exercise 2-4 (E2-4) (Assumptions, Principles, and Constraints) Presented below are the assumptions, principles, and constraints used in this chapter

ACC 225 Week Two (Week 2) Solution

ACC 225
University of Phoenix (UoP)
Financial Accounting

Larson, K. D., Wild, J. J., & Chiappetta B. (2005). Fundamental accounting principles (17th ed.)

Week Two (Week 2) Solution

CheckPoint: Debits and Credits
• Resource: Fundamental Accounting Principles, p. 74
• Due Date: Day 4 [Individual] forum
• Post your answers to Quick Study questions QS 2-3, QS 2-4, and QS 2-5.

Assignment: Preparing Journal Entries and Trial Balances
• Resource: Fundamental Accounting Principles, pp. 76 and 80
• Due Date: Day 7 [Individual] forum
• Complete Exercises 2-4 and 2-5 on p. 76 and Problem 2-2A on p. 80.
• Post your answers as an attachment.


 Click here for the solution: ACC 225 Week Two (Week 2) Solution