2-29 Basic Review Exercises
Fill in the blanks for each of the following independent cases:
(a) (b) (c) (d) (e)
Selling Variable Total Total Total (f)
Price Cost Units Contribution Fixed Net
Case per Unit per Unit Sold Margin Costs Income
1 $25 $— 120,000 $720,000 $640,000 $ —
2 10 6 100,000 — 320,000 —
3 20 15 — 100,000 — 15,000
4 30 20 70,000 — — 12,000
5 — 9 80,000 160,000 110,000 —
Click here for the solution: Fill in the blanks for each of the following independent cases
Showing posts with label cases. Show all posts
Showing posts with label cases. Show all posts
Wednesday, April 13, 2016
Sunday, September 27, 2015
In each of the following independent cases the company closes its books on December 31
Problem: P14-5 -- Reporting Liabilities (Comprehensive Bond Problem)
In each of the following independent cases the company closes its books on December 31.
1. Sanford Co. sells $500,000 of 10% bonds on March 1, 2010. The bonds pay interest on September 1 and March 1. The due date of the bonds is September 1, 2013. The bonds yield 12%. Give entries through December 31, 2011.
2. Titania Co. sells $400,000 of 12% bonds on June 1, 2010. The bonds pay interest on December 1 and June 1. The due date of the bonds is June 1, 2014. The bonds yield 10%. On October 1, 2011. Titania buys back $120,000 worth of bonds for $126,000 (includes accrued interest). Give entries through December 1, 2012.
Instructions
(Round to the nearest dollar.)
For the two cases prepare all of the relevant journal entries from the time of sale until the date indicated. Use the effective-interest method for discount and premium amortization (construct amortization tables where applicable). Amortize premium or discount on interest dates and at year-end. (Assume that no reversing entries were made.)
Click here for the solution: In each of the following independent cases the company closes its books on December 31
In each of the following independent cases the company closes its books on December 31.
1. Sanford Co. sells $500,000 of 10% bonds on March 1, 2010. The bonds pay interest on September 1 and March 1. The due date of the bonds is September 1, 2013. The bonds yield 12%. Give entries through December 31, 2011.
2. Titania Co. sells $400,000 of 12% bonds on June 1, 2010. The bonds pay interest on December 1 and June 1. The due date of the bonds is June 1, 2014. The bonds yield 10%. On October 1, 2011. Titania buys back $120,000 worth of bonds for $126,000 (includes accrued interest). Give entries through December 1, 2012.
Instructions
(Round to the nearest dollar.)
For the two cases prepare all of the relevant journal entries from the time of sale until the date indicated. Use the effective-interest method for discount and premium amortization (construct amortization tables where applicable). Amortize premium or discount on interest dates and at year-end. (Assume that no reversing entries were made.)
Click here for the solution: In each of the following independent cases the company closes its books on December 31
Companion Computer Company has been purchasing carrying cases for its portable computers at a delivered cost of $68 per unit
EX 9-6 Companion Computer Company has been purchasing carrying cases for its portable computers at a delivered cost of $68 per unit. The company, which is currently operating below full capacity, charges factory overhead to production at the rate of 40% of direct labor cost. The fully absorbed unit costs to produce comparable carrying cases are expected to be as follows:
Direct materials $25.00
Direct labor 32.00
Factory overhead (40% of direct labor) $12.80
Total cost per unit $69.80
If Companion Computer Company manufactures the carrying cases, fixed factory overhead costs will not increase and variable factory overhead costs associated with the cases are expected to be 15% of the direct labor costs.
a. Prepare a differential analysis report, dated October 11, 2010, for the make-or-buy decision.
b. On the basis of the data presented, would it be advisable to make the carrying cases or to continue buying them?
Click here for the solution: Companion Computer Company has been purchasing carrying cases for its portable computers at a delivered cost of $68 per unit
Direct materials $25.00
Direct labor 32.00
Factory overhead (40% of direct labor) $12.80
Total cost per unit $69.80
If Companion Computer Company manufactures the carrying cases, fixed factory overhead costs will not increase and variable factory overhead costs associated with the cases are expected to be 15% of the direct labor costs.
a. Prepare a differential analysis report, dated October 11, 2010, for the make-or-buy decision.
b. On the basis of the data presented, would it be advisable to make the carrying cases or to continue buying them?
Click here for the solution: Companion Computer Company has been purchasing carrying cases for its portable computers at a delivered cost of $68 per unit
Tuesday, September 8, 2015
For each of these five separate cases, identify the principle of internal control that is violated
ACC 225 Week 8
Problems 8-1B
For each of these five separate cases, identify the principle of internal control that is violated. Recommend what the business should do to ensure adherence to principles of internal control.
1. Latoya Tally is the company’s computer specialist and oversees its computerized payroll system. Her boss recently asked her to put password protection on all office computers. Latoya has put a password in place that allows only the boss access to the file where pay rates are changed and personnel are added or deleted from the payroll.
2. Lake Theater has a computerized order-taking system for its tickets. The system is active all week and backed up every Friday night.
3. X2U Company has two employees handling acquisitions of inventory. One employee places purchase orders and pays vendors. The second employee receives the merchandise.
4. The owner of Super-Aid uses a check protector to perforate checks, making it difficult for anyone to alter the amount of the check. The check protector sits on the owner’s desk in an office
that contains company checks and is often unlocked.
5. LeAnn Company is a small business that has separated the duties of cash receipts and cash disbursements. The employee responsible for cash disbursements reconciles the bank account monthly.
Click here for the solution: For each of these five separate cases, identify the principle of internal control that is violated
Problems 8-1B
For each of these five separate cases, identify the principle of internal control that is violated. Recommend what the business should do to ensure adherence to principles of internal control.
1. Latoya Tally is the company’s computer specialist and oversees its computerized payroll system. Her boss recently asked her to put password protection on all office computers. Latoya has put a password in place that allows only the boss access to the file where pay rates are changed and personnel are added or deleted from the payroll.
2. Lake Theater has a computerized order-taking system for its tickets. The system is active all week and backed up every Friday night.
3. X2U Company has two employees handling acquisitions of inventory. One employee places purchase orders and pays vendors. The second employee receives the merchandise.
4. The owner of Super-Aid uses a check protector to perforate checks, making it difficult for anyone to alter the amount of the check. The check protector sits on the owner’s desk in an office
that contains company checks and is often unlocked.
5. LeAnn Company is a small business that has separated the duties of cash receipts and cash disbursements. The employee responsible for cash disbursements reconciles the bank account monthly.
Click here for the solution: For each of these five separate cases, identify the principle of internal control that is violated
Monday, August 31, 2015
Calculate the amount of the child and dependent care credit allowed for 2010 in each of the following cases
Calculate the amount of the child and dependent care credit allowed for 2010 in each of the following cases, assuming the taxpayers had no income other than the stated amounts.
a. William and Carla file a joint tax return. Carla earned $26,000 during the year, while William attended law school full-time for 9 months and earned no income. They paid $3,500 for the care of their 3-year-old child, Carl.
b. Raymond and Michele file a joint tax return. Raymond earned $32,500 during the year, while Michele earned $9,000 for the year from a part-time job. They paid $7,000 for the care of their two children under age 13.
c. Beth is a single taxpayer who has two dependent children under age 5. Beth earned $23,500 in wages during the year and paid $6,700 for the care of her children.
Click here for the solution: Calculate the amount of the child and dependent care credit allowed for 2010 in each of the following cases
a. William and Carla file a joint tax return. Carla earned $26,000 during the year, while William attended law school full-time for 9 months and earned no income. They paid $3,500 for the care of their 3-year-old child, Carl.
b. Raymond and Michele file a joint tax return. Raymond earned $32,500 during the year, while Michele earned $9,000 for the year from a part-time job. They paid $7,000 for the care of their two children under age 13.
c. Beth is a single taxpayer who has two dependent children under age 5. Beth earned $23,500 in wages during the year and paid $6,700 for the care of her children.
Click here for the solution: Calculate the amount of the child and dependent care credit allowed for 2010 in each of the following cases
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