Froblem I Thomas plans to set up a business that build custom house for high net-worth...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Froblem I Thomas plans to set up a business that build custom house for high net-worth customers in Upstate NY on January 1¹, 2018. He would borrow $1,500,000 from a bank to invest in the business as star-up capital and receive a minimum salary of $5,000/month. Cost Classification (Assignment #1) Here is the list of some related items or products that he would need to start the business: - Lumber - Roof - Concrete - Insulation - Ducting - Paint - Corporate office building He needs to hire you as an accountant to help his financial and accounting work, and one supervisor who is in charge of the supervision of building custom houses. His business cost drivers are provided in Table 1. Required: Thomas needs your help in classifying the various costs. In order to manage these costs, he wants them identified using the information below. He asked that you use Table 2 (page 3) for your answers. a) Behavior: fixed or variable cost b) Traceability: direct or indirect c) Financial reporting: product or period d) If product cost, identify which items are direct materials, direct labor or manufacturing overhead. Costing Systems (Assignment #2) Thomas discussed the business plan with you. He was told that there are three different types of costing systems that exist in organizations - job order, process costing and activity based costing. Required: Which type of costing system is his business most likely to use? Discuss? Corporate office building Equipment used to build various custom house Lumber Roof Concrete Insulation Ducting Paint Accountant salary Supervisor salary Items Salary of home assembly workers Estimated MOH Utilities for office (include gas, electric and water) $300 per month Mobile phone (business) $400 per month Corporate office building depreciation Deprediation of Equipment used to build various custom houses Lumber Roof Concrete Insulation Ducting Paint Utilities for office (include gas, electric, and water) Mobile phone (business) Accountant salary Supervisor salary Thomas salary Salary of home assembly workers Cost $45,000 (depreciated over 15 years on a straight line basis- no salvage value) $30,000 (depreciated over lo years on a straight line basis- no salvage value) $30 per square foot $9 per square foot $3.25 per square foot $1.50 per square foot $55 per linear foot $150 per square foot $3,000 per month $5,000 per month $10 per hour 37,000 per month Fixed Variable Direct Cost Classification Indirect Product DM DL MOH Period Froblem I Thomas plans to set up a business that build custom house for high net-worth customers in Upstate NY on January 1¹, 2018. He would borrow $1,500,000 from a bank to invest in the business as star-up capital and receive a minimum salary of $5,000/month. Cost Classification (Assignment #1) Here is the list of some related items or products that he would need to start the business: - Lumber - Roof - Concrete - Insulation - Ducting - Paint - Corporate office building He needs to hire you as an accountant to help his financial and accounting work, and one supervisor who is in charge of the supervision of building custom houses. His business cost drivers are provided in Table 1. Required: Thomas needs your help in classifying the various costs. In order to manage these costs, he wants them identified using the information below. He asked that you use Table 2 (page 3) for your answers. a) Behavior: fixed or variable cost b) Traceability: direct or indirect c) Financial reporting: product or period d) If product cost, identify which items are direct materials, direct labor or manufacturing overhead. Costing Systems (Assignment #2) Thomas discussed the business plan with you. He was told that there are three different types of costing systems that exist in organizations - job order, process costing and activity based costing. Required: Which type of costing system is his business most likely to use? Discuss? Corporate office building Equipment used to build various custom house Lumber Roof Concrete Insulation Ducting Paint Accountant salary Supervisor salary Items Salary of home assembly workers Estimated MOH Utilities for office (include gas, electric and water) $300 per month Mobile phone (business) $400 per month Corporate office building depreciation Deprediation of Equipment used to build various custom houses Lumber Roof Concrete Insulation Ducting Paint Utilities for office (include gas, electric, and water) Mobile phone (business) Accountant salary Supervisor salary Thomas salary Salary of home assembly workers Cost $45,000 (depreciated over 15 years on a straight line basis- no salvage value) $30,000 (depreciated over lo years on a straight line basis- no salvage value) $30 per square foot $9 per square foot $3.25 per square foot $1.50 per square foot $55 per linear foot $150 per square foot $3,000 per month $5,000 per month $10 per hour 37,000 per month Fixed Variable Direct Cost Classification Indirect Product DM DL MOH Period
Expert Answer:
Answer rating: 100% (QA)
22 23 Assignment 2 24 Activitybased costing ABC is a costing method that identifies activi... View the full answer
Related Book For
Engineering Economy
ISBN: 978-0132554909
15th edition
Authors: William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Posted Date:
Students also viewed these accounting questions
-
Use the information in problem 9 to set up a dynamic hedge using stock index futures. Assume a multiplier of 500. The futures price is 496.29. The volatility is 17.5 percent. The continuously...
-
Your supervisor would like to set up a single Sec. 401(k) plan exclusively for the managers of your organization. Concerned that this arrangement might not meet the requirements for a qualified plan,...
-
A contractor wishes to set up a special fund by making uniform semiannual end-of-period deposits for 20 years. The fund is to provide $10,000 at the enc of each of the last 5 years of the 20-year...
-
Miller with corporate and personal taxes ____________. Answer options are displayed below it. After Modigliani and Miller's (MM) original no-tax theory, they went on to develop another theory that...
-
The Lakeside Electronics Company has two bond issues outstanding. Both bonds pay $100 semiannual interest plus $1,000 at maturity. Bond A has a remaining maturity of 15 years; bond B has a maturity...
-
Let g(x) = x. Find a) g 1 ({0}). b) g 1({1, 0, 1}). c) g 1 ({x | 0 < x < 1}).
-
Can the project manager and the systems analyst be the same? Explain your answer.
-
Digital Software Inc., has two product lines. The income statement for the year ended December 31 shows the following: The products, Num 1 and Num 2, are sold in two territories, North and South, as...
-
What do you mean by trigger update and create the routing table of RIP(Routing Information Protocol) of the below Topology. 172.16.20.0/26 172.16.20.64/26 172.16.20.128/26 172.16.21.109/30 R1 s0/1...
-
Tracey White, the owner of the Buzz Coffee Shop chain, has decided to expand her operations. Her 2012 financial statements follow. Tracey can buy two additional coffeehouses for $3 million, and she...
-
For this discussion, your focus will be to think through what asymmetric information, moral hazard, and adverse selection have to do with corporate hiring staff accountants. As we saw in the week 7...
-
WHAT ARE CONCEPTUAL FRAMEWORKS AND THEEORIES ON COMPASSION OF HILDEGARD?
-
Expats can face both health and security issues when overseas. Identify and discuss 3 major issues that might impact the safety of expatriates living abroad in Turkey. As a Global HR manager, what...
-
what is the company inventory valuation method? and what is the company inventory reserve?
-
Can you elucidate the integration of advanced remote sensing technologies and real-time data analytics in facilitating situational awareness and enhancing the efficiency of recovery operations in...
-
Provide an additional play-centered game to help develop letter awareness game and oral language.
-
K Use the rational zeros theorem to list the potential rational zeros of the polynomial function. Do not attempt to find the zeros. f(x)=x-3x+17x-19
-
Briefly discuss the implications of the financial statement presentation project for the reporting of stockholders equity.
-
Owing to the rising cost of copper, in 1982 the U.S. Mint changed the composition of pennies from 95% copper (and 5% zinc) to 2.5% copper (and 97.5% zinc) to save money. Your favorite aunt has a...
-
Fill in Table P5-23 below when P = $10,000, S = $2,000 (at the end of four years), and = 15% per year. Complete the accompanying table and show that the equivalent uniform CR amount equals $3,102.12....
-
Qwest Airlines has implemented a program to recycle all plastic drink cups used on their aircraft. Their goal is to generate $5 million by the end of the recycle program's five-year life. Each...
-
Identify something you own, perhaps even something you still use regularly. a. Give a list of at least six reasons why you might consider replacing the identified item. b. Identify at least two...
-
A company owns a 6-year-old gear hobber that has a book value of \($60,000.\) The present market value of the hobber is \($80,000.Anew\) gear hobber can be purchased for \($450,000.\) Using an...
-
Ten reasons why companies use equipment long after replacements would be justified economically. In many cases, these reasons do not apply just to companies; rather, they apply to us as individuals....
Study smarter with the SolutionInn App