New Semester
Started
Get
50% OFF
Study Help!
--h --m --s
Claim Now
Question Answers
Textbooks
Find textbooks, questions and answers
Oops, something went wrong!
Change your search query and then try again
S
Books
FREE
Study Help
Expert Questions
Accounting
General Management
Mathematics
Finance
Organizational Behaviour
Law
Physics
Operating System
Management Leadership
Sociology
Programming
Marketing
Database
Computer Network
Economics
Textbooks Solutions
Accounting
Managerial Accounting
Management Leadership
Cost Accounting
Statistics
Business Law
Corporate Finance
Finance
Economics
Auditing
Tutors
Online Tutors
Find a Tutor
Hire a Tutor
Become a Tutor
AI Tutor
AI Study Planner
NEW
Sell Books
Search
Search
Sign In
Register
study help
business
managerial accounting
Accounting 24th Edition Carl S Warren, James M Reeve, Jonathan Duchac - Solutions
Evergreen Security Bank, Inc., wishes to evaluate three capital investment projects by using the net present value method. Relevant data related to the projects are summarized as follows:1. Assuming that the desired rate of return is 15%, prepare a net present value analysis for each project. Use
Toasted Treats Snack Company is considering two possible investments: a delivery truck or a bagging machine. The delivery truck would cost $44,271 and could be used to deliver an additional 61,000 bags of pretzels per year. Each bag of pretzels can be sold for a contribution margin of $0.40. The
Al a Mode, Inc., is considering one of two investment options. Option 1 is a $60,000 investment in new blending equipment that is expected to produce equal annual cash flows of $16,000 for each of seven years. Option 2 is a $70,000 investment in a new computer system that is expected to produce
The total factory overhead for Urban Styles, Inc., is budgeted for the year at $225,000, divided into two departments: Cutting, $72,000, and Sewing, $153,000. Urban Styles manufactures two types of men’s pants: jeans and khakis. The jeans require 0.05 direct labor hour in Cutting and 0.10 direct
Oasis Palms Hotel uses activity-based costing to determine the cost of servicing customers. There are three activity pools: guest check-in, room cleaning, and meal service. The activity rates associated with each activity pool are $9.40 per guest check-in, $22.50 per room cleaning, and $3.40 per
Contemporary Lighting Inc. manufactures entry and dining room lighting fixtures. Five activities are used in manufacturing the fixtures. These activities and their associated budgeted activity costs and activity bases are as follows:Corporate records were obtained to estimate the amount of activity
Kitchen Mate, Inc., is estimating the activity cost associated with producing ovens and refrigerators. The indirect labor can be traced into four separate activity pools, based on time records provided by the employees. The budgeted activity cost and activity-base information are provided as
Memory Disk Inc. is considering a change to activity-based product costing. The company produces two products, CDs and DVDs, in a single production department. The production department is estimated to require 3,000 direct labor hours. The total indirect labor is budgeted to be $270,000. Time
Gourmet Appliance Company manufactures small kitchen appliances. The product line consists of blenders and toaster ovens. Gourmet Appliance presently uses the multiple production department factory overhead rate method. The factory overhead is as follows:The direct labor information for the
Valley Hospital plans to use activity-based costing to assign hospital indirect costs to the care of patients. The hospital has identified the following activities and activity rates for the hospital indirect costs:The activity usage information associated with the two patients is as follows:a.
David Harrelson Motorcycle Company manufactures a variety of motorcycles. Harrelson’s purchasing policy requires that the purchasing agents place each quarter’s purchasing requirements out for bid. This is because the Purchasing Department is evaluated solely by its ability to get the lowest
The High Altitude Ski Company manufactures skis in the finishing and assembly process. Skis are manufactured in 34-ski batch sizes. The finishing time is 20 minutes per ski. The assembly time is 16 minutes per ski. It takes 10 minutes to move a batch of skis from finishing to assembly.a. Compute
Glow Bright Co. manufactures light bulbs. Glow Bright’s purchasing policy requires that the purchasing agents place each quarter’s purchasing requirements out for bid. This is because the Purchasing Department is evaluated solely by its ability to get the low-est purchase prices. The lowest
The chief executive officer (CEO) of Advent Inc. has just returned from a management seminar describing the benefits of the just-in-time philosophy. The CEO issued the fol-lowing statement after returning from the conference:This company will become a just-in-time manufacturing company. Presently,
Classic Chef Appliance Company manufactures home kitchen appliances. The manufacturing process includes stamping, final assembly, testing, and shipping. In the stamping operation, a number of individuals are responsible for stamping the steel outer surface of the appliance. The stamping operation
The Nite Life Jean Company manufactures jeans in the cutting and sewing process. Jeans are manufactured in 90-jean batch sizes. The cutting time is 9 minutes per jean. The sewing time is 12 minutes per jean. It takes 14 minutes to move a batch of jeans from cutting to sewing.a. Compute the
Audio Max Electronics Company manufactures electronic stereo equipment. The manufacturing process includes printed circuit (PC) card assembly, final assembly, testing, and shipping. In the PC card assembly operation, a number of individuals are responsible for assembling electronic components into
The American textile industry has moved much of its operations offshore in the pursuit of lower labor costs. Textile imports have risen from 2% of all textile production in 1962 to over 70% in 2010. Offshore manufacturers make long runs of standard mass-market apparel items. These are then brought
Connect Tek Inc. manufactures and assembles two major types of telephone assemblies€” a cordless phone and a cellular phone. The process consists of a just-in-time cell for each product. The data that follow concern only the cellular phone just-in-time cell. For the year, Connect Tek Inc.
Optic Matrix Inc. manufactures and assembles automobile instrument panels for both Yokohama Motors and Detroit Motors. The process consists of a just-in-time product cell for each customer€™s instrument assembly. The data that follow concern only the Yokohama just-in-time cell. For the
Active Apparel Company manufactures various styles of men’s casual wear. Shirts are cut and assembled by a workforce that is paid by piece rate. This means that they are paid according to the amount of work completed during a period of time. To illustrate, if the piece rate is $0.10 per sleeve
The president of Cardio Care Exercise Equipment Co. has been concerned about the growth in costs over the last several years. The president asked the controller to perform an activity analysis to gain a better insight into these costs. The activity analysis revealed the following:The production
The administrator of elections for the city of Madisonville has been asked to perform an activity analysis of its optical scanning center. The optical scanning center reads voter forms into the computer. The result of the activity analysis is summarized as follows:1. Prepare a Pareto chart of the
Furry Friends Inc. manufactures toy stuffed animals. The direct labor time required to cut, sew, and stuff a toy is 10 minutes per unit. The company makes two types of stuffed toys—a lion and a bear. The lion is assembled in lot sizes of 60 units per batch, while the bear is assembled in lot
The budgeted conversion costs for a just-in-time cell are $1,267,500 for 1,950 production hours. Each unit produced by the cell requires 12 minutes of cell process time. During the month, 575 units are manufactured in the cell. The estimated materials costs are $840 per unit. Provide the following
Jackson Inc. has analyzed the setup time on its computer-controlled lathe. The setup requires changing the type of fixture that holds a part. The average setup time has been 135 minutes, consisting of the following steps:Turn off machine and remove fixture from
The budgeted conversion costs for a just-in-time cell are $180,000 for 1,800 production hours. Each unit produced by the cell requires 24 minutes of cell process time. During the month, 450 units are manufactured in the cell. The estimated materials costs are $90 per unit. Provide the following
Cardio Care Inc., manufactures stationary bicycles and treadmills. The products are produced in its Fabrication and Assembly production departments. In addition to production activities, several other activities are required to produce the two products. These activities and their associated
Metropolitan Bank uses activity-based costing to determine the cost of servicing customers. There are three activity pools: teller transaction processing, check processing, and ATM transaction processing. The activity rates associated with each activity pool are $3.40 per teller transaction, $0.16
Elegant Occasions Inc. sells china and flatware over the Internet. For the next period, the budgeted cost of the sales order processing activity is $78,300, and 4,350 sales orders are estimated to be processed.a. Determine the activity rate of the sales order processing activity.b. Determine the
PlayTyme Company manufactures and sells outdoor play equipment. PlayTyme uses activity-based costing to determine the cost of the sales order processing and the customer return activity. The sales order processing activity has an activity rate of $18 per sales order, and the customer return
What would happen to net income if the activities noted in Discussion Question 6 were allocated to products for financial statement reporting and theinventory increased?Data from Discussion Question 6:Shipping, selling, marketing, sales order processing, return processing, and advertising
The management of Cobalt Engines Inc. manufactures gasoline and diesel engines through two production departments, Fabrication and Assembly. Management needs accurate product cost information in order to guide product strategy. Presently, the company uses a single plantwide factory overhead rate
Peach Computer Company manufactures a desktop and portable computer through two production departments, Assembly and Testing. Presently, the company uses a single plantwide factory overhead rate for allocating factory overhead to the two products. However, management is considering using the
Blue Skies Airline provides passenger airline service, using small jets. The airline connects four major cities: Atlanta, Cincinnati, Chicago, and Los Angeles. The company expects to fly 140,000 miles during a month. The following costs are budgeted for a
Healthmark Medical Inc. wishes to determine its product costs. Healthmark offers a variety of medical procedures (operations) that are considered its €œproducts.€ The overhead has been separated into three major activities. The annual estimated activity costs and activity bases
Comfort Step Company manufactures and sells shoes. Comfort Step uses activity-based costing to determine the cost of the sales order processing and the shipping activity. The sales order processing activity has an activity rate of $8 per sales order, and the shipping activity has an activity rate
The total factory overhead for Maritime Marine Company is budgeted for the year at $600,000, divided into four activities: fabrication, $204,000; assembly, $105,000; setup, $156,000; and inspection, $135,000. Maritime manufactures two types of boats: speedboats and bass boats. The activity-base
Home & Farm Glove Company produces three types of gloves: small, medium, and large. A glove pattern is first stenciled onto leather in the Pattern Department. The stenciled patterns are then sent to the Cut and Sew Department, where the final glove is cut and sewed together. Home & Farm
Z-Rox Inc. manufactures office copiers, which are sold to retailers. The price and cost of goods sold for each copier are as follows:Price................................................$890 per unitCost of goods sold..........................510
Western Mechancial Inc. manufactures cooling units for commercial buildings. The price and cost of goods sold for each unit are as follows:Price...........................................$55,200 per unitCost of goods sold.....................27,500
The total factory overhead for Urban Styles, Inc., is budgeted for the year at $225,000, divided into four activities: cutting, $22,500; sewing, $45,000; setup, $100,000; and inspection, $57,500. Urban manufactures two types of men€™s pants: jeans and khakis. The activity-base usage
Flint Engine Parts Inc. (FEP) produces three products€”pistons, valves, and cams€”for the heavy equipment industry. FEP has a very simple production process and product line and uses a single plantwide factory overhead rate to allocate overhead to the three products. The factory
Alabama 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
The total factory overhead for Maritime Marine Company is budgeted for the year at $600,000, divided into two departments: Fabrication, $420,000, and Assembly, $180,000. Maritime manufactures two types of boats: speedboats and bass boats. The speed-boats require 8 direct labor hours in Fabrication
Krispy Treats Snack Food Company manufactures three types of snack foods: tortilla chips, potato chips, and pretzels. The company has budgeted the following costs for the upcoming period:Factory overhead is allocated to the three products on the basis of processing hours. The products had the
Pro Audio Inc. manufactures two products: receivers and loudspeakers. The factory over-head incurred is as follows: Indirect labor.................................................$260,000Sub assembly Department............................145,000Final Assembly
White Mountain Sports Inc. manufactures two products: snowboards and skis. The factory overhead incurred is as follows:Indirect labor........................$200,000Cutting Department.................85,000Finishing Department..............95,000
Sousa Band Instruments Inc. makes three musical instruments: trumpets, tubas, and trombones. The budgeted factory overhead cost is $139,500. Factory overhead is allocated to the three products on the basis of direct labor hours. The products have the following budgeted production volume and direct
The total factory overhead for Maritime Marine Company is budgeted for the year at $600,000. Maritime Marine manufactures two types of boats: speedboats and bass boats. The speedboat and bass boat each require 12 direct labor hours for manufacture. Each product is budgeted for 250 units of
Daisy Dairy Company manufactures three products€”whole milk, skim milk, and cream€”in two production departments, Blending and Packing. The factory overhead for Daisy Dairy is $360,000. The three products consume both machine hours and direct labor hours in the two production
California Chrome Company manufactures three chrome-plated products€”automobile bumpers, valve covers, and wheels. These products are manufactured in two production departments (Stamping and Plating). The factory overhead for California Chrome is $338,400. The three products consume both
The total factory overhead for Urban Styles, Inc., is budgeted for the year at $225,000. Urban Styles manufactures two types of men’s pants: jeans and khakis. The jeans and khakis each require 0.15 direct labor hour for manufacture. Each product is budgeted for 15,000 units of production for the
Solid Solutions Inc. is considering the purchase of automated machinery that is expected to have a useful life of five years and no residual value. The average rate of return on the average investment has been computed to be 20%, and the cash payback period was computed to be 5.5 years. Do you see
Hawkeye Healthcare Corp. is proposing to spend $134,136 on an eight-year project that has estimated net cash flows of $27,000 for each of the eight years.a. Compute the net present value, using a rate of return of 15%. Use the present value of an annuity of $1 table in the chapter (Exhibit 2).b.
The Canyons Resort, a Utah ski resort, recently announced a $400 million expansion to lodging properties, lifts, and terrain. Assume that this investment is estimated to produce $70.8 million in equal annual cash flows for each of the first 10 years of the project life.a. Determine the expected
The internal rate of return method is used by Maxwell Construction Co. in analyzing a capital expenditure proposal that involves an investment of $45,420 and annual net cash flows of $12,000 for each of the six years of its useful life.a. Determine a present value factor for an annuity of $1
Carnival Corporation has recently placed into service some of the largest cruise ships in the world. One of these ships, the Carnival Dream, can hold up to 3,600 passengers and cost $750 million to build. Assume the following additional information:• There will be 320 cruise days per year
Project 1 requires an original investment of $12,000. The project will yield cash flows of $4,000 per year for seven years. Project 2 has a calculated net present value of $6,500 over a four-year life. Project 1 could be sold at the end of four years for a price of $14,500. (a) Determine the
Easton Excavation Company is planning an investment of $120,000 for a bulldozer. The bulldozer is expected to operate for 1,400 hours per year for five years. Customers will be charged $105 per hour for bulldozer work. The bulldozer operator costs $34 per hour in wages and benefits. The bulldozer
Project A requires an original investment of $112,000. The project will yield cash flows of $22,000 per year for nine years. Project B has a calculated net present value of $2,400 over a six-year life. Project A could be sold at the end of six years for a price of $50,000. (a) Determine the
Luxmark Hotels is considering the construction of a new hotel for $210 million. The expected life of the hotel is 30 years with no residual value. The hotel is expected to earn revenues of $58 million per year. Total expenses, including depreciation, are expected to be $32 million per year. Luxmark
A project is estimated to cost $409,370 and provide annual net cash flows of $94,000 for six years. Determine the internal rate of return for this project, using Exhibit 2.Exhibit 2: Present Value of an Annuity of $1 at Compound Interest 6% 20% Year 10% 12% 15% 0.943 0.870 0.909 0.893 0.833
Courier Express, Inc., is considering the purchase of an additional delivery vehicle for $48,000 on January 1, 2012. The truck is expected to have a five-year life with an expected residual value of $12,000 at the end of five years. The expected additional revenues from the added delivery capacity
A project is estimated to cost $71,580 and provide annual net cash flows of $15,000 for nine years. Determine the internal rate of return for this project, using Exhibit 2.Exhibit 2: Present Value of an Annuity of $1 at Compound Interest 6% 20% Year 10% 12% 15% 0.943 0.870 0.909 0.893 0.833
The following data are accumulated by Parker Company in evaluating the purchase of $126,000 of equipment, having a four-year useful life:a. Assuming that the desired rate of return is 15%, determine the net present value for the proposal. Use the table of the present value of $1 appearing in
Renaissance Capital Group is considering allocating a limited amount of capital investment funds among four proposals. The amount of proposed investment, estimated income from operations, and net cash flow for each proposal are as follows:The company€™s capital rationing policy requires
Nova Communications Inc. is considering allocating a limited amount of capital investment funds among four proposals. The amount of proposed investment, estimated income from operations, and net cash flow for each proposal are as follows:The company€™s capital rationing policy requires a
Bath Works Products Company is considering an investment in one of two new product lines. The investment required for either product line is $660,000. The net cash flows associated with each product are as follows:a. Recommend a product offering to Bath Works Products Company, based on the cash
The investment committee of Shield Insurance Co. is evaluating two projects, office expansion and upgrade to computer servers. The projects have different useful lives, but each requires an investment of $610,000. The estimated net cash flows from each project are as follows:The committee has
The investment committee of Fiesta Cantina Restaurants Inc. is evaluating two restaurant sites. The sites have different useful lives, but each requires an investment of $780,000. The estimated net cash flows from each site are as follows:The committee has selected a rate of 20% for purposes of net
Nations Trust is evaluating two capital investment proposals for a drive-up ATM kiosk, each requiring an investment of $320,000 and each with an eight-year life and expected total net cash flows of $512,000. Location 1 is expected to provide equal annual net cash flows of $64,000, and Location 2 is
The management of Pacific Utilities Inc. is considering two capital investment projects. The estimated net cash flows from each project are as follows:The generating unit requires an investment of $1,172,900, while the distribution net-work expansion requires an investment of $850,360. No residual
A project has estimated annual net cash flows of $8,600. It is estimated to cost $47,300. Determine the cash payback period. Round to one decimal place.
The management of Saturn Networks Inc. is considering two capital investment projects. The estimated net cash flows from each project are as follows:The radio station requires an investment of $1,275,540, while the TV station requires an investment of $1,770,100. No residual value is expected from
Mid-Continent Railroad Company wishes to evaluate three capital investment proposals by using the net present value method. Relevant data related to the proposals are summarized as follows:1. Assuming that the desired rate of return is 20%, prepare a net present value analysis for each proposal.
A project has estimated annual net cash flows of $121,000. It is estimated to cost $798,600. Determine the cash payback period. Round to one decimal place.
Based on the data presented in Exercise 24-17 assume that Voice Com, Inc., uses the variable cost concept of applying the cost-plus approach to product pricing.a. Determine the variable costs and the variable cost amount per unit for the production and sale of 5,000 units of cellular phones.b.
Determine the average rate of return for a project that is estimated to yield total income of $54,000 over three years, has a cost of $80,000, and has a $20,000 residual value.
The capital investment committee of Hampton Landscaping Company is considering two capital investments. The estimated income from operations and net cash flows from each investment are as follows:Each project requires an investment of $64,000. Straight-line depreciation will be used, and no
A machine with a book value of $75,000 has an estimated five-year life. A proposal is offered to sell the old machine for $64,000 and replace it with a new machine at a cost of $80,000. The new machine has a five-year life with no residual value. The new machine would reduce annual direct labor
A condensed income statement by product line for Crown Beverage Inc. indicated the following for King Cola for the past year:Sales........................................................$235,000Cost of goods sold...................................110,000Gross
Product T has revenue of $194,000, variable cost of goods sold of $115,000, variable selling expenses of $33,000, and fixed costs of $60,000, creating a loss from operations of $14,000. Prepare a differential analysis as of September 12, 2012, to determine if Product T should be continued
L’Essence Cosmetics Company is planning a one-month campaign for June to promote sales of one of its two cosmetics products. A total of $150,000 has been budgeted for advertising, contests, redeemable coupons, and other promotional activities. The following data have been assembled for their
Gilroy Corporation is considering new equipment. The equipment can be purchased from an overseas supplier for $3,200. The freight and installation costs for the equipment are $640. If purchased, annual repairs and maintenance are estimated to be $400 per year over the four-year useful life of the
Saginaw Tooling Company is considering replacing a machine that has been used in its factory for two years. Relevant data associated with the operations of the old machine and the new machine, neither of which has any estimated residual value, are as follows:Annual nonmanufacturing operating
Lassiter Company owns equipment with a cost of $140,000 and accumulated depreciation of $75,000 that can be sold for $55,000, less a 6% sales commission. Alternatively, the equipment can be leased by Lassiter Company for five years for a total of $51,000, at the end of which there is no residual
Franklin Printing Company is considering replacing a machine that has been used in its factory for four years. Relevant data associated with the operations of the old machine and the new machine, neither of which has any estimated residual value, are as follows:Annual nonmanufacturing operating
Kincaid Company owns a machine with a cost of $365,000 and accumulated depreciation of $55,000 that can be sold for $276,000, less a 5% sales commission. Alternatively, the machine can be leased by Kincaid Company for three years for a total of $287,000, at the end of which there is no residual
On August 1, Matrix Stores Inc. is considering leasing a building and purchasing the necessary equipment to operate a retail store. Alternatively, the company could use the funds to invest in $150,000 of 6% U.S. Treasury bonds that mature in 16 years. The bonds could be purchased at face value. The
The Walt Disney Company has four profitable business segments, described as follows:€¢ Media Networks:The ABC television and radio network, The Disney Channel, ESPN, A&E, E!, and Disney.com.€¢ Parks and Resorts:Walt Disney World Resort, Disneyland, Disney Cruise Line, and
The condensed income statement for the Domestic Division of Fahkahany Industries Inc. is as follows (assuming no service department charges):The manager of the Domestic Division is considering ways to increase the rate of return on investment.a. Using the DuPont formula for rate of return on
One item is omitted from each of the following computations of the rate of return on investment:Determine the missing items, identifying each by the appropriate letter. Rate of Return on Investment = Profit Margin x Investment Turnover 8% (a) 10% (b) 15% 0.80 2.00 (d) 1.50 (c) 14% 20% 16% (e) %3D
Temasec Airlines, Inc., has two divisions organized as profit centers, the Passenger Division and the Cargo Division. The following divisional income statements were prepared:The service department charge rate for the service department costs was based on revenues. Since the revenues of the two
Ryan Snow Sports Company has two divisions, Wholesale and Retail, and two corporate service departments, Tech Support and Accounts Payable. The corporate expenses for the year ended December 31, 2012, are as follows:The other corporate administrative expenses include officers€™ salaries
Harris Corporation, a manufacturer of electronics and communications systems, uses a service department charge system to charge profit centers with Computing and Communications Services (CCS) service department costs. The following table identifies an abbreviated list of service categories and
Lockhart Industries, Inc., is a diversified aerospace company, including two operating divisions, Semiconductors and Navigational Systems divisions. Condensed divisional income statements, which involve no intracompany transfers and which include a breakdown of expenses into variable and fixed
The vice president of operations of Cantor Bike Company is evaluating the performance of two divisions organized as investment centers. Invested assets and condensed income statement data for the past year for each division are as follows:1. Prepare condensed divisional income statements for the
A condensed income statement for the Electronics Division of Fannie Industries Inc. for the year ended January 31, 2012, is as follows:Assume that the Electronics Division received no charges from service departments. The president of Fannie Industries Inc. has indicated that the
A condensed income statement for the Golf Division of Rewind Sports Inc. for the year ended December 31, 2012, is as follows:Assume that the Golf Division received no charges from service departments. The president of Rewind Sports has indicated that the division€™s rate of return on a
Showing 5100 - 5200
of 5971
First
45
46
47
48
49
50
51
52
53
54
55
56
57
58
59
Last
Step by Step Answers
Get 50% OFF
Claim Now
