Gwinnett Paper Company manufactures three products (computer paper, newsprint, and specialty paper)

Gwinnett Paper Company manufactures three products (computer paper, newsprint, and specialty paper) in a continuous production process. Senior management has asked the controller to conduct an activity-based costing study. The controller identified the amount of factory overhead required by the critical activities of the organization as follows:

Activity Activity Cost Pool
Production $495,000
Setup 225,000
Moving 29,750
Shipping 126,000
Production engineering 150,000

The activity bases identified for each activity are as follows:

Activity Activity Base
Production Machine Hours
Setup Number of setups
Moving Number of moves
Shipping Number of customer orders
Production engineering Number of test runs

The activity-base usage quantities and units produced for the three products were determined from corporate records and are as follows:

Machine Number of Number of Number of Number of Units
hours setups moves customer test runs
orders
Computer paper 900 130 290 440 90 1000
Newsprint 1125 60 130 135 20 1250
Speciality paper 450 310 430 625 140 500
Total 2475 500 850 1200 250 2750

Each product requires 0.9 machine hour per unit.

Instructions
1. Determine the activity rate for each activity.
2. Determine the total and per-unit activity cost for all three products. Round all per unit amounts to the nearest whole cent.
3. Why aren't the activity unit costs equal across all three products since they require the same machine time per unit?


Click here for the solution: Gwinnett Paper Company manufactures three products (computer paper, newsprint, and specialty paper)

Your professor has asked you to complete a research paper concerning the link between the auditing profession and financial reporting standard setters and regulators

Problem 1-34 Your professor has asked you to complete a research paper concerning the link between the auditing profession and financial reporting standard setters and regulators.

Required:
For each independent situation, determine which regulating or standard-setting body you should research:
(a) The entity that sets accounting standards for the government sector.
(b) The entity that decides what is required to become a licensed CPA and conduct work as a CPA.
(c) The entity that sets standards for audits of publicly traded companies.
(d) The entity that sets financial reporting standards in the U.S.
(e) The entity that prepares and administers the Uniform CPA Exam.
(f) The entity that has ultimate authority over public company reports as well as accounting and reporting standards.


Click here for the solution: Your professor has asked you to complete a research paper concerning the link between the auditing profession and financial reporting standard setters and regulators

In a working paper for combined financial statements of home office and branch, the branch's net income is included in

MULTIPLE CHOICE

1. In a working paper for combined financial statements of home office and branch, the branch's net income is included in: (Points : 1)

2. If both the home office and the branch of a business enterprise use the perpetual inventory system, a Shipments to Branch ledger account appears in the accounting records of: (Points : 1)

3. The following journal entry (explanation omitted) appeared in the accounting records of Marty Corporation's only branch:
Operating Expenses 600,000
Home Office 600,000
The journal entry indicates that: (Points : 1)

4. Direct out-of-pocket costs of a business combination that are part of the cost of the combinee do not include: (Points : 1)

5. The Income: Branch ledger account is maintained in the accounting records of: (Points : 1)

6. In a business combination, the appropriate accounting for an excess of current fair values the combinee's identifiable net assets over the combinor's cost is to: (Points : 1)

7. The Shipments to Branch ledger account in the accounting records of the home office of a business enterprise: (Points : 1)

8. The business enterprises that enter into a business combination are termed the: (Points : 1)

9. If at the end of an accounting period the balance of the Investment in Branch ledger account in the accounting records of the home office is $20,000 and the balance of the Home Office account in the accounting records of the branch (after the branch recorded closing entries) is $25,500, the most likely explanation for the discrepancy of $5,500 is a: (Points : 1)

10. The Home Office ledger account in the accounting records of a branch is best described as: (Points : 1)


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Horizon Telecom sold $300,000 worth of 120-day commercial paper for $298,000

E16–5 Horizon Telecom sold $300,000 worth of 120-day commercial paper for $298,000. What is the dollar amount of interest paid on the commercial paper? What is the effective 120-day rate on the paper?

Click here for the solution: Horizon Telecom sold $300,000 worth of 120-day commercial paper for $298,000