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Connect Managerial Accounting Homework Chapter 1
Q1. Listed here are product costs for the production of soccer balls.
Identify each cost (a) as either fixed or variable and (b) as either direct or indirect by selecting the appropriate dropdowns.
Q2. TechPro offers instructional courses in e-commerce website design. The company holds classes in a building that it owns.
Identify each of TechPro’s costs below as (a) variable or fixed and (b) direct or indirect by selecting the appropriate dropdowns. Assume the cost object is an individual class.
Q3. Current assets for two different companies at fiscal year-end are listed here. One is a manufacturer, Rayzer Skis Mfg., and the other, Sunrise Foods, is a grocery distribution company.
| Account | Company 1 | Company 2 |
| Cash | $11,000 | $9,000 |
| Raw materials inventory | — | 39,875 |
| Merchandise inventory | 42,875 | — |
| Work in process inventory | — | 29,000 |
| Finished goods inventory | — | 49,000 |
| Accounts receivable, net | 61,000 | 71,000 |
| Prepaid expenses | 3,500 | 700 |
Required:
1. Identify which set of numbers relates to the manufacturer and which to the merchandiser.
2a. & 2b. Prepare the current asset section for each company from this information.
Q4. The following data is provided for Garcon Company and Pepper Company.
| Garcon Company | Pepper Company | |
| Beginning finished goods inventory | $12,900 | $17,500 |
| Beginning work in process inventory | 16,700 | 22,950 |
| Beginning raw materials inventory (direct materials) | 9,800 | 14,250 |
| Rental cost on factory equipment | 31,250 | 26,050 |
| Direct labor | 19,600 | 40,200 |
| Ending finished goods inventory | 18,050 | 14,300 |
| Ending work in process inventory | 24,100 | 16,600 |
| Ending raw materials inventory | 7,700 | 8,800 |
| Factory utilities | 10,500 | 15,000 |
| Factory supplies used (indirect materials) | 13,300 | 5,600 |
| General and administrative expenses | 23,000 | 54,500 |
| Indirect labor | 1,500 | 9,340 |
| Repairs—Factory equipment | 5,660 | 1,750 |
| Raw materials purchases | 47,000 | 57,000 |
| Selling expenses | 61,200 | 55,900 |
| Sales | 196,530 | 307,510 |
| Cash | 31,000 | 24,200 |
| Factory equipment, net | 282,500 | 139,825 |
| Accounts receivable, net | 13,600 | 21,200 |
Required:
1. Complete the table to find the cost of goods manufactured for both Garcon Company and Pepper Company for the year ended December 31, 2019.
2. Complete the table to calculate the cost of goods sold for both Garcon Company and Pepper Company for the year ended December 31, 2019.
Q5. The following data is provided for Garcon Company and Pepper Company.
| Garcon Company | Pepper Company | |
| Beginning finished goods inventory | $12,900 | $17,500 |
| Beginning work in process inventory | 16,700 | 22,950 |
| Beginning raw materials inventory (direct materials) | 9,800 | 14,250 |
| Rental cost on factory equipment | 31,250 | 26,050 |
| Direct labor | 19,600 | 40,200 |
| Ending finished goods inventory | 18,050 | 14,300 |
| Ending work in process inventory | 24,100 | 16,600 |
| Ending raw materials inventory | 7,700 | 8,800 |
| Factory utilities | 10,500 | 15,000 |
| Factory supplies used (indirect materials) | 13,300 | 5,600 |
| General and administrative expenses | 23,000 | 54,500 |
| Indirect labor | 1,500 | 9,340 |
| Repairs—Factory equipment | 5,660 | 1,750 |
| Raw materials purchases | 47,000 | 57,000 |
| Selling expenses | 61,200 | 55,900 |
| Sales | 196,530 | 307,510 |
| Cash | 31,000 | 24,200 |
| Factory equipment, net | 282,500 | 139,825 |
| Accounts receivable, net | 13,600 | 21,200 |
Required:
1. Prepare income statements for both Garcon Company and Pepper Company.
2. Prepare the current assets section of the balance sheet for each company.
Q6. The following data is provided for Garcon Company and Pepper Company.
| Garcon Company | Pepper Company | |
| Beginning finished goods inventory | $12,900 | $17,500 |
| Beginning work in process inventory | 16,700 | 22,950 |
| Beginning raw materials inventory (direct materials) | 9,800 | 14,250 |
| Rental cost on factory equipment | 31,250 | 26,050 |
| Direct labor | 19,600 | 40,200 |
| Ending finished goods inventory | 18,050 | 14,300 |
| Ending work in process inventory | 24,100 | 16,600 |
| Ending raw materials inventory | 7,700 | 8,800 |
| Factory utilities | 10,500 | 15,000 |
| Factory supplies used (indirect materials) | 13,300 | 5,600 |
| General and administrative expenses | 23,000 | 54,500 |
| Indirect labor | 1,500 | 9,340 |
| Repairs—Factory equipment | 5,660 | 1,750 |
| Raw materials purchases | 47,000 | 57,000 |
| Selling expenses | 61,200 | 55,900 |
| Sales | 196,530 | 307,510 |
| Cash | 31,000 | 24,200 |
| Factory equipment, net | 282,500 | 139,825 |
| Accounts receivable, net | 13,600 | 21,200 |
Required:
1. Compute the total prime costs for both Garcon Company and Pepper Company.
2. Compute the total conversion costs for both Garcon Company and Pepper Company.
Q7.
| Unimart | Precision Manufacturing | |
| Beginning inventory | ||
| Merchandise | $321,000 | |
| Finished goods | $642,000 | |
| Cost of purchases | 510,000 | |
| Cost of goods manufactured | 840,000 | |
| Ending inventory | ||
| Merchandise | 221,000 | |
| Finished goods | 215,000 |
Compute cost of goods sold for each of these two companies for the year.
Q8. The following selected account balances are provided for Delray Mfg.
| Sales | $1,155,000 |
| Raw materials inventory, beginning | 38,000 |
| Work in process inventory, beginning | 54,000 |
| Finished goods inventory, beginning | 65,100 |
| Raw materials purchases | 152,500 |
| Direct labor | 230,000 |
| Factory supplies used (indirect materials) | 24,500 |
| Indirect labor | 57,000 |
| Repairs—Factory equipment | 5,250 |
| Rent cost of factory building | 52,000 |
| Advertising expense | 84,000 |
| General and administrative expenses | 131,000 |
| Raw materials inventory, ending | 46,500 |
| Work in process inventory, ending | 39,000 |
| Finished goods inventory, ending | 68,300 |
Prepare its schedule of cost of goods manufactured for the current year ended December 31.
Q9. The following selected account balances are provided for Delray Mfg.
| Sales | $1,155,000 |
| Raw materials inventory, beginning | 38,000 |
| Work in process inventory, beginning | 54,000 |
| Finished goods inventory, beginning | 65,100 |
| Raw materials purchases | 152,500 |
| Direct labor | 230,000 |
| Factory supplies used (indirect materials) | 24,500 |
| Indirect labor | 57,000 |
| Repairs—Factory equipment | 5,250 |
| Rent cost of factory building | 52,000 |
| Advertising expense | 84,000 |
| General and administrative expenses | 131,000 |
| Raw materials inventory, ending | 46,500 |
| Work in process inventory, ending | 39,000 |
| Finished goods inventory, ending | 68,300 |
Prepare an income statement for Delray Mfg. (a manufacturer).
Q10. Beck Manufacturing reports the following information in T-account form for 2019.
| Raw Materials Inventory | |||
| Begin. Inv. | 10,600 | ||
| Purchases | 56,000 | ||
| Avail. for use | 66,600 | ||
| DM used | 49,000 | ||
| End. Inv. | 17,600 | ||
| Work in Process Inventory | |||
| Begin. Inv. | 15,200 | ||
| DM used | 49,000 | ||
| Direct labor | 29,500 | ||
| Overhead | 64,500 | ||
| Manuf. costs | 158,200 | ||
| Cost of goods manuf. | 144,800 | ||
| End. Inv. | 13,400 | ||
| Finished Goods Inventory | |||
| Begin. Inv. | 20,200 | ||
| Cost of goods manuf. | 144,800 | ||
| Avail. for sale | 165,000 | ||
| Cost of Goods Sold | 145,000 | ||
| End. Inv. | 20,000 | ||
Required:
1. Prepare the schedule of cost of goods manufactured for the year.
2. Compute cost of goods sold for the year.
Q11. The following calendar year-end information is taken from the December 31, 2019, adjusted trial balance and other records of Leone Company.
| Advertising expense | $28,000 | Direct labor | $693,900 |
| Depreciation expense—Office equipment | 8,800 | Income taxes expense | 295,900 |
| Depreciation expense—Selling equipment | 10,600 | Indirect labor | 59,600 |
| Depreciation expense—Factory equipment | 36,100 | Miscellaneous production costs | 11,000 |
| Factory supervision | 120,300 | Office salaries expense | 70,000 |
| Factory supplies used | 9,800 | Raw materials purchases | 996,000 |
| Factory utilities | 42,000 | Rent expense—Office space | 27,000 |
| Inventories | Rent expense—Selling space | 26,400 | |
| Raw materials, December 31, 2018 | 159,100 | Rent expense—Factory building | 78,700 |
| Raw materials, December 31, 2019 | 177,000 | Maintenance expense—Factory equipment | 36,700 |
| Work in process, December 31, 2018 | 18,500 | Sales | 4,485,800 |
| Work in process, December 31, 2019 | 24,000 | Sales salaries expense | 393,200 |
| Finished goods, December 31, 2018 | 167,800 | ||
| Finished goods, December 31, 2019 | 138,200 |
Required:
1. Prepare the company’s 2019 schedule of cost of goods manufactured.
Q12. The following calendar year-end information is taken from the December 31, 2019, adjusted trial balance and other records of Leone Company.
| Advertising expense | $28,000 | Direct labor | $693,900 |
| Depreciation expense—Office equipment | 8,800 | Income taxes expense | 295,900 |
| Depreciation expense—Selling equipment | 10,600 | Indirect labor | 59,600 |
| Depreciation expense—Factory equipment | 36,100 | Miscellaneous production costs | 11,000 |
| Factory supervision | 120,300 | Office salaries expense | 70,000 |
| Factory supplies used | 9,800 | Raw materials purchases | 996,000 |
| Factory utilities | 42,000 | Rent expense—Office space | 27,000 |
| Inventories | Rent expense—Selling space | 26,400 | |
| Raw materials, December 31, 2018 | 159,100 | Rent expense—Factory building | 78,700 |
| Raw materials, December 31, 2019 | 177,000 | Maintenance expense—Factory equipment | 36,700 |
| Work in process, December 31, 2018 | 18,500 | Sales | 4,485,800 |
| Work in process, December 31, 2019 | 24,000 | Sales salaries expense | 393,200 |
| Finished goods, December 31, 2018 | 167,800 | ||
| Finished goods, December 31, 2019 | 138,200 |
2. Prepare the company’s 2019 income statement that reports separate categories for (a) selling expenses and (b) general and administrative expenses.
Q13. Shown here are annual financial data taken from two different companies.
| Music World Retail | Wave-Board Manufacturing | |
| Beginning inventory | ||
| Merchandise | $225,000 | |
| Finished goods | $320,000 | |
| Cost of purchases | 310,000 | |
| Cost of goods manufactured | 590,000 | |
| Ending inventory | ||
| Merchandise | 160,000 | |
| Finished goods | 150,000 |
Required:
1. Prepare the cost of goods sold section of the income statement for the year for each company in Merchandising Business and Manufacturing Business.
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