Ex. 10-2

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					Chapter 10
Exercise 10-2


a.   Packaging materials                                              Direct materials
b.   Depreciation on production machinery                             Factory overhead
c.   Salary of process engineers                                      Factory overhead
d.   Depreciation on the Clarksville, Indiana soap plant              Factory overhead
e.   Scents and fragrances                                            Direct materials
f.   Wages of manufacturing employees                                 Direct labor
g.   Resins for soap and shampoo products                             Direct materials
     Plant manager salary for the Morristown, Tennessee, toothpaste   Factory
h.   plant                                                            overhead
i.   Maintenance supplies                                             Factory overhead
j.   Wages paid to Packaging Department employees                     Direct labor
Chapter 10
Exercise 10-4


a.        Factory janitorial supplies                         Product
b.        Depreciation on office equipment                    Period
c.        Advertising expenses                                Period
d.        Fabric used during production                       Product
e.        Depreciation on sewing machines                     Product
f.        Property taxes on factory building and equipment    Product
g.        Sales commissions                                   Period
h.        Wages of sewing machine operators                   Product
i.        Repairs and maintenance costs for sewing machines   Product
j.        Salary of production quality control supervisor     Product
k.        Factory supervisors' salaries                       Product
l.        Oil used to lubricate sewing machines               Product
m.        Travel costs of salespersons                        Period
n.        Corporate controller's salary                       Period
o.        Utility costs for the office building               Period
p.        Research and development costs                      Period
q.        Salaries of distribution center personnel           Period
Chapter 10
Exercise 10-7


a.   Sales                                      $   775,000
     Gross profit                                   265,000
     Cost of goods sold                         $   510,000


b.   Materials purchased                        $   303,000
     Indirect materials                              32,000
     Direct materials available                 $   271,000
     Materials inventory, end of period              35,000
     Direct materials cost                      $   236,000


c.   Total manufacturing costs for the period                 $   620,000
     Direct materials cost                      $   236,000
     Indirect materials                              32,000
     Indirect labor                                  63,000
     Other factory overhead                          17,500       348,500
     Direct labor cost                                        $   271,500
Chapter 10
Exercise 10-16


a.   Surgical room hours    7 * 6 * 50 = 2,100 hours


     Total overhead         $    367,500
     Hours per year                2,100
     Overhead per hour      $        175


b.   Overhead per hour      $         175
     Hours                              5
     Overhead charged       $         875


c.   Overhead per hour      $        175
     Hours                           182
     Overhead applied       $     31,850
     Actual overhead              30,700
     Over (under) applied   $      1,150
Chapter 10
Exercise 10-19


Beginning materials inventory                    $     -
Materials purchased                                165,800
Materials available for use                      $ 165,800
Ending materials inventory                          18,200
Direct materials used in production                          $ 147,600
Direct labor                                                    96,250
Factory overhead                                                77,000
Total manufacturing costs for the period                     $ 320,850
Beginning work in process inventory                                -
                                                             $ 320,850
Ending work in process inventory                                17,950
Cost of goods manufactured                                   $ 302,900
Beginning finished goods inventory                                 -
Goods available for sale                                     $ 302,900
Ending finished goods inventory                                  1,600
Cost of goods sold                                           $ 301,300


                           Wreckin Ronnie, Inc.
                            Income Statement
                    For the Month Ending July 31, 2008

Sales                                                        $ 520,000
Cost of goods sold                                             301,300
Gross profit                                                 $ 218,700
Operating expenses:
    Selling expenses                             $ 119,000
    Administrative expenses                         52,100       171,100
Income from operations                                       $    47,600
Chapter 10
Exercise 10-29

                                Amount charged
Activity              Rate    Patient M  Patient T
Room and meals
         8 days   $     165   $   1,320
         4 days   $     165               $    660

Radiology
       5 images   $     250       1,250
       3 images   $     250                    750

Pharmacy
      6 orders    $      45        270
      2 orders    $      45                     90

Chemistry lab
      7 tests     $      85        595
      3 tests     $      85                    255

Operating room
     4.5 hours    $     680       3,060
       2 hours    $     680                   1,360
                              $   6,495   $   3,115
Chapter 10
Problem 10-2


                    Direct      Direct           Factory                                Machine
  1      Job       materials    labor           overhead      Total                      hours        Status
         601     $    18,100 $    17,000      $    11,395   $  46,495                      215.0   Sold
         602          20,000      25,500      $    12,190      57,690                      230.0   Sold
         603          13,050       9,700      $     9,275      32,025                      175.0   Sold
         604          34,500      33,550      $    15,900      83,950                      300.0   In process
         605          15,700      14,800      $    10,494      40,994                      198.0   Completed
         606          17,800      18,300      $    11,925      48,025                      225.0   In process
      Total manufacturing costs                             $ 309,179                    1,343.0


  2                 Direct      Direct          Factory
         Job      materials     labor          overhead       Total
         601     $ 18,100 $ 17,000            $ 11,395         46,495
                                                                $
         602          20,000      25,500          12,190       57,690
         603          13,050       9,700           9,275       32,025
         605          15,700      14,800          10,494       40,994
      Total manufacturing costs                             $ 177,204


  3                 Direct      Direct          Factory
         Job      materials     labor          overhead       Total
         601     $ 18,100 $ 17,000            $ 11,395         46,495
                                                                $
         602          20,000      25,500          12,190       57,690
         603          13,050       9,700           9,275       32,025
      Total manufacturing costs                             $ 136,210

      The jobs sold in June represent the cost of goods sold.


  4                 Direct       Direct         Factory
         Job       materials      labor        overhead             Total
         605      $ 15,700      $ 14,800      $ 10,494          $    40,994

      The completed jobs on hand represent the value of the finished goods inventory.


  5                 Direct      Direct          Factory
         Job      materials     labor          overhead       Total
         604     $ 34,500 $ 33,550            $ 15,900         83,950
                                                                $
         606          17,800      18,300          11,925       48,025
      Total manufacturing costs                             $ 131,975

      The unfinished jobs represent the value of work in process inventory.