Business
Yancey Productions is a film studio that uses a job-order costing system. The companys direct materials consist of items such as costumes and props. Its direct labor includes each films actors, directors, and extras. The companys overhead costs include items such as utilities, depreciation of equipment, senior management salaries, and wages of maintenance workers. Yancey applies its overhead cost to films based on direct labor-dollars.At the beginning of the year, Yancey made the following estimates:Direct labor-dollars to support all productions $ 8,260,000Fixed overhead cost $ 4,956,000Variable overhead cost per direct labor-dollar $ 0.17Required:1. Compute the predetermined overhead rate. (I found the answer: .77 per DL$)2. During the year, Yancey produced a film titled You Can Say That Again that incurred the following costs:Direct materials $ 1,386,000Direct labor cost $ 2,478,000Compute the total job cost for this particular film.Direct Materials: $1,386,000Direct Labor: $2,478,000
Esquire Company needs to acquire a molding machine to be used in its manufacturing process. Two types of machines that would be appropriate are presently on the market. The company has determined the following (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1)Machine A could be purchased for $48,000. It will last 10 years with annual maintenance costs of $1,000 per year. After 10 years the machine can be sold for $5,000.Machine B could be purchased for $40,000. It also will last 10 years and will require maintenance costs of $4,000 in year three, $5,000 in year six, and $6,000 in year eight. After 10 years, the machine will have no salvage value.Required:Assume an interest rate of 8% properly reflects the time value of money in this situation and that maintenance costs are paid at the end of each year. Ignore income tax considerations. (Negative amounts should be indicated by a minus sign. Do not round intermediate calculations. Round your final answers to nearest whole dollar amount.)Calculate the present value of Machine A & Machine B. Which machine Esquire should purchase?
Sandhill Company expects to have a cash balance of $61,550 on January 1, 2017. These are the relevant monthly budget data for the first two months of 2017. 1. Collections from customers: January $86,550, February $161,550. 2. Payments to suppliers: January $55,550, February $90,550. 3. Wages: January $31,490, February $41,490. Wages are paid in the month they are incurred. 4. Administrative expenses: January $22,490, February $25,490. These costs include depreciation of $1,000 per month. All other costs are paid as incurred. 5. Selling expenses: January $16,490, February $21,490. These costs are exclusive of depreciation. They are paid as incurred. 6. Sales of short-term investments in January are expected to realize $13,490 in cash. Sandhill Company has a line of credit at a local bank that enables it to borrow up to $25,000. The company wants to maintain a minimum monthly cash balance of $35,550.Required:Prepare a cash budget for January and February.
During 2017, Sheffield Company changed from FIFO to weighted-average inventory pricing. Pretax income in 2016 and 2015 (Sheffields first year of operations) under FIFO was $162,140 and $181,860, respectively. Pretax income using weighted-average pricing in the prior years would have been $153,100 in 2016 and $174,200 in 2015. In 2017, Sheffield reported pretax income (using weighted-average pricing) of $205,200. Show comparative income statements for Sheffield, beginning with "Income before income tax," as presented on the 2017 income statement. (The tax rate in all years is 25%.)
A seller uses a perpetual inventory system, and on April 4, it sells $5,000 in merchandise (its cost is $2,400) to a customer on credit terms of 3/10, n/30. Complete the two journal entries to record the sales transaction by selecting the account names from the drop-down menus and entering the dollar amounts in the debit or credit columns. The first journal entry is to record the revenue part of the transaction and the second journal entry is to record the cost part.Date Account Title Debit CreditApril 4 selectMerchandise InventoryAccounts ReceivableCashCost of Goods SoldSales select2,4002,5002,6005,000 select2,4002,5002,6005,000selectMerchandise InventoryAccounts ReceivableCashCost of Goods SoldSales select2,4002,5002,6005,000 select2,4002,5002,6005,000selectMerchandise InventoryAccounts ReceivableCashCost of Goods SoldSales select2,4002,5002,6005,000 select2,4002,5002,6005,000selectMerchandise InventoryAccounts ReceivableCashCost of Goods SoldSales select2,4002,5002,6005,000 select2,4002,5002,6005,000