Part 1 Canine Nutritionists is a manufacturer of grains for dogs. The following information pertains to...
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Part 1 Canine Nutritionists is a manufacturer of grains for dogs. The following information pertains to operations during the 2021 calendar year. Inventory Data: Raw Materials Indirect Materials Work in Progress Finished Goods 1/1/2021 Purchases 31/12/2021 $750,000 $4,330,000 $807,000 71,500 814,750 1,720,200 55,000 320,000 924,000 1,142,600 The following additional information is also available: Sales Revenue Direct Factory Labor Indirect Factory Labor Total Depreciation Total Utilities Distribution & Customer Service Costs Insurance on Plant & Equipment Property Taxes 3 n/a n/a Administrative Wages & Salaries Advertising Expenses Sales Commission $14,776,000 4,371,000 1,232,250 400,000 525,000 76,800 585,000 90,000 1,076,000 57,700 5% of Sales Revenue Required: a) Calculate the raw material used by Canine Nutritionists. b) Calculate the indirect materials used by Canine Nutritionists Of the total depreciation, 80% relates to factory plant & equipment and 20% relates to general and administrative costs. 2 Of the total utilities, 75% relates to manufacturing and 25% relates to general and administrative costs. 3 The property taxes should be shared: 85% manufacturing & 15% general & administrative costs. c) What is the total manufacturing overhead cost incurred by Canine Nutritionists during the period? (3 marks) (3 marks) 31, 2021, clearly (5 marks) d) Determine the prime cost & conversion cost of the product manufactured. e) Prepare a schedule of cost of goods manufactured for the year ended December showing total manufacturing cost & total manufacturing costs to account for. (2 marks) (2 marks) f) What is the unit product cost if Canine Nutritionists manufactured 18,500 bags of grains for the year? (2 marks) from the income (3 marks) g) How does the format of the income statement for a manufacturing concern differ statement of a merchandising business? Part 2 The Wizz Electronics sells a variety of electronic devices including a variety of WIFI SMART camera bulbs. The business began the second quarter (April to June) of 2022 with 15 (V380PRO) camera bulbs at a total cost of $108,750. The following transactions relating to the "V380PRO" camera bulbs were completed during the quarter. April 7 April 30 May 6 May 9 May 31 June 5 June 14 June 30 June 30 90 bulbs were purchased at a cost of $6,850 each. In addition, the business paid freight charges of $800 cash on each bulb to have the inventory shipped from the point of purchase to their warehouse. The sales for April were 75 bulbs which yielded total sales revenue of $803,250. (15 of these bulbs were sold on account to two longstanding customers of the business) A new batch of 80 bulbs was purchased at a total cost of $654,800 Upon inspection of the inventory purchased on May 6, five (5) of the bulbs were found to be defective and were returned to the supplier. During the month 62 of the camera bulbs were sold at a price of $11,450 each. A customer, to whom 7 of the bulbs were sold during the first business day of May. returned 3 units of the merchandise, as they were of another make & model. Owing to an increased demand, a further 110 bulbs were purchased at a cost of $9,000 each; the supplier gave a 3% quantity discount on the purchase. 116 bulbs were sold during June at a unit selling price of $12,250. An actual count of inventory was carried out at the close of business which revealed that there were 36 units of the V380PRO brand of merchandise in the store room. Unless otherwise stated, assume that all purchases were on account and received on the dates stated. Required: (A) Prepare a perpetual inventory record for this merchandise, using the first in, first out (FIFO) method of inventory valuation to determine the company's cost of goods sold for the quarter and the value of ending. (20 marks) (B) Given that selling, distribution and administrative costs associated with the V380PRO brand of WIFI SMART camera bulbs for the quarter were $27,255, $42,400, and $140,600 respectively. prepare an income statement for The Wizz (V380PRO) for the quarter ended June 30, 2022. (6 marks) (C) Journalize the transactions for the month of April, assuming the company uses a: Periodic inventory system Perpetual inventory system (8 marks) (D) Buckley Enterprise sells a product that cost $450 per unit and has a monthly demand of 5,000 units. The annual holding cost per unit is calculated as 5% of the unit purchase price. It costs the business $75 to place a single order. Currently the business places 12 orders each year. i) What is the total stock administrative cost of Buckley's current inventory policy? ii) Is this the entity's cost minimizing solution for this product each year? Explain. (6 marks) Part 1 Canine Nutritionists is a manufacturer of grains for dogs. The following information pertains to operations during the 2021 calendar year. Inventory Data: Raw Materials Indirect Materials Work in Progress Finished Goods 1/1/2021 Purchases 31/12/2021 $750,000 $4,330,000 $807,000 71,500 814,750 1,720,200 55,000 320,000 924,000 1,142,600 The following additional information is also available: Sales Revenue Direct Factory Labor Indirect Factory Labor Total Depreciation Total Utilities Distribution & Customer Service Costs Insurance on Plant & Equipment Property Taxes 3 n/a n/a Administrative Wages & Salaries Advertising Expenses Sales Commission $14,776,000 4,371,000 1,232,250 400,000 525,000 76,800 585,000 90,000 1,076,000 57,700 5% of Sales Revenue Required: a) Calculate the raw material used by Canine Nutritionists. b) Calculate the indirect materials used by Canine Nutritionists Of the total depreciation, 80% relates to factory plant & equipment and 20% relates to general and administrative costs. 2 Of the total utilities, 75% relates to manufacturing and 25% relates to general and administrative costs. 3 The property taxes should be shared: 85% manufacturing & 15% general & administrative costs. c) What is the total manufacturing overhead cost incurred by Canine Nutritionists during the period? (3 marks) (3 marks) 31, 2021, clearly (5 marks) d) Determine the prime cost & conversion cost of the product manufactured. e) Prepare a schedule of cost of goods manufactured for the year ended December showing total manufacturing cost & total manufacturing costs to account for. (2 marks) (2 marks) f) What is the unit product cost if Canine Nutritionists manufactured 18,500 bags of grains for the year? (2 marks) from the income (3 marks) g) How does the format of the income statement for a manufacturing concern differ statement of a merchandising business? Part 2 The Wizz Electronics sells a variety of electronic devices including a variety of WIFI SMART camera bulbs. The business began the second quarter (April to June) of 2022 with 15 (V380PRO) camera bulbs at a total cost of $108,750. The following transactions relating to the "V380PRO" camera bulbs were completed during the quarter. April 7 April 30 May 6 May 9 May 31 June 5 June 14 June 30 June 30 90 bulbs were purchased at a cost of $6,850 each. In addition, the business paid freight charges of $800 cash on each bulb to have the inventory shipped from the point of purchase to their warehouse. The sales for April were 75 bulbs which yielded total sales revenue of $803,250. (15 of these bulbs were sold on account to two longstanding customers of the business) A new batch of 80 bulbs was purchased at a total cost of $654,800 Upon inspection of the inventory purchased on May 6, five (5) of the bulbs were found to be defective and were returned to the supplier. During the month 62 of the camera bulbs were sold at a price of $11,450 each. A customer, to whom 7 of the bulbs were sold during the first business day of May. returned 3 units of the merchandise, as they were of another make & model. Owing to an increased demand, a further 110 bulbs were purchased at a cost of $9,000 each; the supplier gave a 3% quantity discount on the purchase. 116 bulbs were sold during June at a unit selling price of $12,250. An actual count of inventory was carried out at the close of business which revealed that there were 36 units of the V380PRO brand of merchandise in the store room. Unless otherwise stated, assume that all purchases were on account and received on the dates stated. Required: (A) Prepare a perpetual inventory record for this merchandise, using the first in, first out (FIFO) method of inventory valuation to determine the company's cost of goods sold for the quarter and the value of ending. (20 marks) (B) Given that selling, distribution and administrative costs associated with the V380PRO brand of WIFI SMART camera bulbs for the quarter were $27,255, $42,400, and $140,600 respectively. prepare an income statement for The Wizz (V380PRO) for the quarter ended June 30, 2022. (6 marks) (C) Journalize the transactions for the month of April, assuming the company uses a: Periodic inventory system Perpetual inventory system (8 marks) (D) Buckley Enterprise sells a product that cost $450 per unit and has a monthly demand of 5,000 units. The annual holding cost per unit is calculated as 5% of the unit purchase price. It costs the business $75 to place a single order. Currently the business places 12 orders each year. i) What is the total stock administrative cost of Buckley's current inventory policy? ii) Is this the entity's cost minimizing solution for this product each year? Explain. (6 marks)
Expert Answer:
Answer rating: 100% (QA)
Answer Part 1 a Raw Material Used Raw material used Beginning raw material inventory Purchases Ending raw material inventory Raw material used 750000 4330000 807000 Raw material used 4273000 b Indirec... View the full answer
Related Book For
Financial Reporting and Analysis
ISBN: 978-0078025679
6th edition
Authors: Flawrence Revsine, Daniel Collins, Bruce, Mittelstaedt, Leon
Posted Date:
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