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ASHFORD ACC206 WEEK 3 E16-17 P16-25A P17-26A P17A-11A

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  • Chapter 16, E 16-17
  • Chapter 16, P 16-25A
  • Chapter 17, P 17-26A
  • Chapter 17, P 17A-11A


E16-17
Calculating income and cost per unit for a service company
Fido Grooming provides grooming services in the local community, In April, Kevin
Oliver, the owner, incurred the following operating costs to groom 650 dogs:
Wages …………………………………………………………………… $3,900
Grooming supplies expense …………………………………. 1,625
Building rent expense ………………………………………….. 1,300
Utilities ………………………………………………………………….    325
Depreciation on equipment ..............................    130
Fido Grooming earned $16,300 in revenues from grooming for the month of April.
Requirements:
1. What is Fido's net operating income for April?
2. What is the cost to groom one dog?
P16-25A
Preparing cost of goods manufactured schedule and Income statement for a manufacturing company
Charlie's Pets succeeded so well that Charlie decided to manufacture his own brand
of chewing bone-Fido Treats. At the end of December 2012, his accounting records showed the following:
Inventories:                                      Beginning                               Ending            
Materials                                          $ 13,400                                 $9,500
Work in process                                          0                                    2,000
Finished goods                                            0                                    5,300
Other information: 
Direct material purchases                $ 33,000        Utilities for plant       $1,600     
Plant janitorial services                          800         Rent of plant            13,000
Sales salaries expense                        5,000     Cust.Serv. HotLine Exp   1,400
Delivery expense                                1,700         Direct labor              22,000
Sales revenue                                 109,000
Requirements:
1. Prepare a schedule of cost of goods manufactured for Fido Treats for the year
ended December 31, 2012.
2. Prepare an income statement for Fido Treats  for the year ended December 31, 2012.
3. How does the format of the income statement for Fido Treats differ from the income statement of a merchandiser?
4. Fido Treats manufactured 18,075 units of its product in 2012. Compute the company’s unit product cost for the year.
P17-26A
Preparing and using a job cost record
Lu Technology, Co., manufactures CDs and DVDs for computer software and entertainment companies. Lu uses job order costing and has a perpetual inventory system.
On April 2, Lu began production of 5,900 DVDs, Job 423, for Stick People Pictures for $1.30 sales price per DVD. Lu promised to deliver the DVD’s to Stick People by April 5. Lu incurred the following costs:
Date                     Labor Time Record No.                Description                   Amount
4/2                             655                                 10 hours @ $14               $ 140
4/3                             656                                 20 hours @ $13                  260
      Materials
      Requisition 
Date                   No.                          Description                                       Amount
4/2                     63             31 lbs, polycarbonate plastic @ $11                  $341
4/2                     64             25 lbs. acrylic plastic @ $27                               675
4/3                     74              3 lbs. refined aluminum @ $42                         126
Stick People provides the movie file for Lu to burn onto the DVD’s at a cost of $0.50 per DVD. Lu Technology allocates manufacturing overhead to jobs base on the relation between estimated overhead of $540,000 and estimated direct labor cost of $432,000. Job 423 was completed and shipped on April 3.
Requirements:
1. Prepare a job cost record similar to Exhibit 17-6 for job 423. Calculate the pre-determined overhead rate; then allocate manufacturing overhead to the job.
2. Journalize in summary form the requisition of direct material (including the movie files) and the assignment of direct labor and manufacturing overhead to Job 423.
3. Journalize completion of the job and the sale of the 5,900 DVD’s.
P17A-11A
Computing equivalent units and assigning costs to completed units and
ending work in process; no beginning work in process inventory or cost
transferred in
Amy Electronics makes CD players in three processes: assembly, programming, and
packaging. Direct materials are added at the beginning of the assembly process.
Conversion costs are incurred evenly throughout the process. The assembly Department had no work in process inventory on October 31. In mid-November, Amy Electronics started production on 125,000 CD players. Of this number, 95,800 CD players were assembled during November and transferred out to the Programming Department. The November 30 work in process inventory in the Assembly Department was 25% of the way through the assembly process. Direct materials costing $437,500 were placed in production in Assembly during November, and Direct labor of $200,800 and Manufacturing overhead of $134,275 were assigned to that department.
Requirements:
1. Compute the number of equivalent units and the cost per equivalent unit in the Assembly Department for November.
2. Assign total costs in the Assembly Department to (a) units completed and transferred to Programming during November and (b) units still ill process at November 30.
3. Prepare a T-account for Work in process inventory-Assembly to show its activity during November, including the November 30 balance.

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