1. Exercise 2-49 (Algo) Cost Behavior and Forecasting (LO 2-5)

Sophia's Restaurant served 6,500 meals last quarter. Sophia recorded the following costs with those meals.

Variable costs:
Ingredients used	$	15,500
Direct labor		13,500
Indirect materials and supplies		8,300
Utilities		4,950
Fixed costs:
Managers' salaries		29,500
Rent		25,500
Depreciation on equipment (straight-line, time basis)		9,500
Other costs		6,000

Required:

Suppose that Sophia expects to serve 20 percent more meals in the next quarter. Unit variable costs are expected to remain unchanged. However, Sophia knows that if the restaurant serves over 7,150 meals in a quarter, she must hire an additional manager (part-time) at a cost of $8,850 for the quarter. Other fixed costs are expected to increase by 10 percent.

Calculate the unit cost and the total cost if 7,800 meals are served next quarter. (Round "Unit costs" answer to 2 decimal places.)

Total variable cost:

Total fixed costs:

Total costs:

Unit costs:

2. Exercise 2-42 (Algo) Prepare Statements for a Manufacturing Company (LO 2-2, 4)

The following balances are from the accounts of Crabtree Machining Company:

	January 1 (Beginning)			December 31 (Ending)
Direct materials inventory	$	97,700		$	109,000
Work-in-process inventory		109,400			107,800
Finished goods inventory		42,300			46,800

Direct materials purchased during the year amount to $516,700, and the cost of goods sold for the year was $1,870,000.

Required:

Prepare a cost of goods sold statement.

Required: Prepare a cost of goods sold statement. 109,400 CRABTREE MACHINING COMPANY Cost of Goods Sold Statement For the Year Ended December 31 Beginning work-in-process inventory Manufacturing costs: Direct materials: Beginning inventory $ 97,700 Purchases 516,700 Materials available $ 614,400 Less: Ending inventory 109,000 Direct materials used $ 505,400 Other manufacturing costs Total manufacturing costs Total costs of work-in-process Less: Ending work-in-process Cost of goods manufactured Beginning finished goods inventory Finished goods available for sale Less: Ending finished goods inventory Cost of goods sold 505,400 $ 614,800 107,800 $ 507,000 42,300 $ 549,300 46,800 $ 502,500