For each of the following costs, identify whether the item is:

For each of the following costs, identify whether the item is:

A variable or fixed cost?
Direct or indirect cost?
Controllable or uncontrollable cost?

For example: Plant Utilities would be a variable, indirect, and controllable cost.

Not all items will fit into each category. Items that do not fit a category should be labeled as not applicable.

Raw materials.
Staples used to secure packed boxes of the product.
Plant janitor’s wages.
Order processing clerk’s wages.
Advertising expenses.
Production worker’s wages.
Production supervisor’s salaries.
Sales force commissions.
Maintenance supplies used.
President’s salary.
Electricity cost for the office building.
Real estate taxes for the plant.
Production-run setup costs.
Depreciation of plant equipment.
Outbound shipping costs.

Use a table format to complete this assignment.

Click here for the solution: For each of the following costs, identify whether the item is:

(Identify the costs below as variable, fixed, or mixed) Moctezuma Furniture Corporation incurred the following costs

Identify the costs below as variable, fixed, or mixed.

E5-4 Moctezuma Furniture Corporation incurred the following costs.
1. Wood used in the production of furniture.
2. Fuel used in delivery trucks.
3. Straight-line depreciation on factory building.
4. Screws used in the production of furniture.
5. Sales staff salaries.
6. Sales commissions.
7. Property taxes.
8. Insurance on buildings
9. Hourly wages of furniture craftsmen.
10. Salaries of factory supervisors.
11. Utilities expense.

Click here for the solution: (Identify the costs below as variable, fixed, or mixed) Moctezuma Furniture Corporation incurred the following costs

For the following investments identify whether they are

Exercise 17-1 (E17-1) (Investment Classifications) For the following investments identify whether they are:
1. Trading Securities
2. Available-for-Sale Securities
3. Held-to-Maturity Securities

Each case is independent of the other.
(a) A bond that will mature in 4 years was bought 1 month ago when the price dropped. As soon as the value increases, which is expected next month, it will be sold.
(b) 10% of the outstanding stock of Farm-Co was purchased. The company is planning on eventually getting a total of 30% of its outstanding stock.
(c) 10-year bonds were purchased this year. The bonds mature at the first of next year.
(d) Bonds that will mature in 5 years are purchased. The company would like to hold them until they mature, but money has been tight recently and they may need to be sold.
(e) Preferred stock was purchased for its constant dividend. The company is planning to hold the preferred stock for a long time.
(f) A bond that matures in 10 years was purchased. The company is investing money set aside for an expansion project planned 10 years from now.

Click here for the solution: For the following investments identify whether they are

Identify the five components that comprise pension expense

Chapter 20: Question 10

Identify the five components that comprise pension expense. Briefly explain the nature of each component.

Click here for the solution: Identify the five components that comprise pension expense

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

Identify the TRUE statement regarding non-recurring items on the income statement

MULTIPLE CHOICE

1. Identify the TRUE statement regarding non-recurring items on the income statement. (Points : 2)

2. Which of the following is NOT a category of inventory used in a manufacturing company? (Points : 2)

3. The City of Gunnison awarded a $5,000,000 road-construction contract to the Fast Builders Construction Company. Construction was expected to take three years. After one year, Fast Builders had incurred $625,000 of cost and was approximately 20% completed with the road. The company estimated that another $2,500,000 would be expended to complete the contract. The company is confident regarding its estimates. What amount of profit, if any, should Fast Builders recognize for the first year? (Points : 2)

4. Which of the following should be subtracted out to arrive at the proper amount of net sales revenue to be reported on the income statement.
Estimated sales
discounts to be Expected
taken by customers Warranty Costs (Points : 2)

5. Cost of goods sold for a manufacturing company would be calculated as
Beginning finished goods inventory (BFGI)
Ending finished goods inventory (EFGI)
Work-in-process (WIP)
Cost of goods manufactured (CGM)
Raw materials (RM)
Overhead (OH) (Points : 2)

6. Automated Merchandising Company uses the LIFO method of cost assignment. The following data are available:
Date Units Unit Cost Total Cost
Beginning inventory Jan. 1 400 $24 $ 9,600
Purchase Mar. 13 800 28 22,400
Purchase June 20 1,200 32 38,400
Ending inventory Dec. 31 200
The value of the ending inventory will be (Points : 2)

7. Duhany Auto Company sold off a major segment of its business during March of 2007 at a loss. The loss from the sale should be reported in the firm's financial statements as a(n)(Points : 2)

8. Which of the following items is reported on an income statement?
Income from Cash provided
Continuing operations by operations (Points : 2)

9. Which of the following is NOT a deduction on the income statement when computing net income? (Points : 2)

10. Work-in-process includes all of the items below EXCEPT (Points : 2)

11. The FIFO inventory cost method differs from the LIFO method in that the (Points : 2)

12. For most firms, revenue is recognized (Points : 2)

13. Product lines eliminated by a company due to the fact that they no longer generate profits are known as (Points : 2)

14. The Fat Brush Paint Store sold merchandise on 30-day credit in the amount of $1,500. A discount of 3% was offered if the customer would pay within 10 days. What is the minimum amount that should be recorded on the day of sale for Accounts Receivable? (Points : 2)

15. Which inventory method results in the lowest income taxes during periods of increasing prices? (Points : 2)

16. The Philandering Soy Company reported the following accounts receivable balances for 2008:
Beginning of the year $84,000
End of the year 90,000
This information means that (Points : 2)

17. The Food-Mart Grocery is preparing its 2007 income statements. In doing so, cost of goods sold and wages expense are both deducted in computing which of the following?
Operating Income Gross Profit (Points : 2)

18. Certain depreciation costs and the amounts paid to certain employees would be reported on the income statement as part of cost of goods sold if the company (Points : 2)

19. A loss from a natural disaster that is both unusual and infrequent should be reported on a company's income statement (Points : 2)

20. The Big Tobacco Company sells cigars. Inventory information for a recent week is below:
Units Unit Cost Total Cost
Beginning inventory 2 $ 6 $12
Purchase 4 8 32
Purchase 6 10 60
If five units were sold during the week, what is the COST OF GOODS SOLD if the LIFO method is used? (Points : 2)


Click here for the solution: Identify the TRUE statement regarding non-recurring items on the income statement

An investment center in Shellforth Corporation was asked to identify three proposals for its capital budget

An investment center in Shellforth Corporation was asked to identify three proposals for its capital budget. Details of those proposals are:

Capital Budget Proposals

A B C

Capital Required $80,000 $50,000 $150,000

Annual Operating Return 24,000 16,000 15,000

Shellforth uses residual income to evaluate all capital budgeting projects. Its minimum required return is 12 percent.

a. Assume you are the investment center manager. Which project do you prefer? Why?

b. Assume your investment center’s current ROI is 18 percent and that the president of Shellforth is thinking about using ROI for the investment center’s evaluation. Would your preferences for the projects listed above change? Why?

Click here for the solution: An investment center in Shellforth Corporation was asked to identify three proposals for its capital budget