Accounting question

Question Description

Product Costs

Direct
Materials

Direct
Labor

Factory
Overhead

Brief Exercise 19-02

Listed below are the three functions of the management of an organization.
1. Planning 2. Directing 3. Controlling

Identify which of the following statements best describes each of the above functions.

(a)		requires management to look ahead and to establish objectives. A key objective of management is to add value to the business.

(b)		involves coordinating the diverse activities and human resources of a company to produce a smooth-running operation. This function relates to the implementation of planned objectives.

(c)		is the process of keeping the activities on track. Management determines whether goals are being met and what changes are necessary when there are deviations.

Brief Exercise 19-05

Identify whether each of the following costs should be classified as product costs or period costs.

(a)				Manufacturing overhead.
(b)				Selling expenses.
(c)				Administrative expenses.
(d)				Advertising expenses.
(e)				Direct labor.
(f)				Direct materials.

Brief Exercise 19-06

Presented below are Rook Company’s monthly manufacturing cost data related to its tablet computer product.

(a)	Utilities for manufacturing equipment	$116,000
(b)	Raw materials (CPU, chips, etc.)	$85,000
(c)	Depreciation on manufacturing building	$880,000
(d)	Wages for production workers	$191,000

Enter each cost item in the following table, placing an “X” under the appropriate headings.

Exercise 19-01

Justin Bleeber has prepared the following list of statements about managerial accounting, financial accounting, and the functions of management.

Identify each statement as true or false.

1.		Financial accounting focuses on providing information to internal users.
2.		Staff positions are directly involved in the company’s primary revenue-generating activities.
3.		Preparation of budgets is part of financial accounting.
4.		Managerial accounting applies only to merchandising and manufacturing companies.
5.		Both managerial accounting and financial accounting deal with many of the same economic events.
6.		Managerial accounting reports are prepared only quarterly and annually.
7.		Financial accounting reports are general-purpose reports.
8.		Managerial accounting reports pertain to subunits of the business.
9.		Managerial accounting reports must comply with generally accepted accounting principles.
10.		The company treasurer reports directly to the vice president of operations.

Exercise 19-04 a-c (Part Level Submission)

Bonita Company reports the following costs and expenses in May.

Factory utilities	$16,000	Direct labor	$72,700
Depreciation on factory equipment	14,250	Sales salaries	50,000
Depreciation on delivery trucks	4,900	Property taxes on factory building	2,600
Indirect factory labor	53,500	Repairs to office equipment	1,800
Indirect materials	85,000	Factory repairs	2,970
Direct materials used	141,700	Advertising	15,600
Factory manager’s salary	8,100	Office supplies used	3,420

From the information:

(a)

Determine the total amount of manufacturing overhead.

Manufacturing overhead

Exercise 19-18

The following is a list of terms related to managerial accounting practices.

1.		Activity-based costing.
2.		Just-in-time inventory.
3.		Balanced scorecard.
4.		Value chain.

Match each of the terms with the statement below that best describes the term.

	Terms	Description
(a)		A performance-measurement technique that attempts to consider and evaluate all aspects of performance using financial and nonfinancial measures in an integrated fashion.
(b)		The group of activities associated with providing a product or performing a service.
(c)		An approach used to reduce the cost associated with handling and holding inventory by reducing the amount of inventory on hand.
(d)		A method used to allocate overhead to products based on each product’s use of the activities that cause the incurrence of the overhead cost.

Problem 19-04A a-c (Part Level Submission) (Video)

The following data were taken from the records of Vaughn Company for the fiscal year ended June 30, 2020.

Raw Materials Inventory 7/1/19	$51,100	Factory Insurance	$5,200
Raw Materials Inventory 6/30/20	41,600	Factory Machinery Depreciation	16,800
Finished Goods Inventory 7/1/19	96,800	Factory Utilities	29,700
Finished Goods Inventory 6/30/20	27,800	Office Utilities Expense	9,550
Work in Process Inventory 7/1/19	21,300	Sales Revenue	563,900
Work in Process Inventory 6/30/20	27,900	Sales Discounts	4,600
Direct Labor	144,350	Plant Manager’s Salary	64,300
Indirect Labor	26,360	Factory Property Taxes	9,610
Accounts Receivable	34,600	Factory Repairs	2,500
		Raw Materials Purchases	97,200
		Cash	37,900

(a)

Prepare a cost of goods manufactured schedule. (Assume all raw materials used were direct materials.)

VAUGHN COMPANY Cost of Goods Manufactured Schedule
			$

	$


:
		$












:
			$

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