Cost Accounting I Ch 1 Ex Solutions
EXERCISES
E1-1
The variances for kitchen wages and utilities were favorable for September, whereas the variances for food and supplies were unfavorable. On a year-to-date basis, the only expense that did not have the same pattern as September was utilities which had a $120 F variance for the month, but an $850 U year-to-date variance. E1-2 No, the performance report should not be prepared just once a year. It should be furnished to managers at regular intervals, in this case monthly, on a timely basis. If it is not provided in a timely fashion, it will not be effective in controlling future operations.
E1-3
Merchandise inventory, January 1 $ 22,000
Plus purchases 183,000
Merchandise available for sale $ 205,000
Less merchandise inventory, January 31 17,000
Cost of goods sold $ 188,000
E1-4
Finished goods, July 1 $ 85,000
Plus cost of goods manufactured 343,000
Finished goods available for sale $ 428,000
Less finished goods, July 31 93,000
Cost of goods sold $ 335,000
E1-5 Selling & Direct Direct Factory Admin. Items Materials Labor Overhead Expense
a. Steel used in an overhead door plant Ö
b. Cloth used in a shirt factory Ö
c. Fiberglass used by a sailboat builder Ö
d. Cleaning solvent for the factory floor Ö
e. Wages of a binder employed in a printing plant Ö
f. Insurance on factory machines Ö
g. Rent paid for factory buildings Ö
h. Wages of the Machining Department supervisor Ö
i. Leather used in a shoe factory Ö
j. Wages of a factory janitor Ö
k. Electric power consumed in operating factory machines Ö
l. Depreciation on corporate offices Ö
m. Fuel used in heating a factory Ö
n. Paint used in the manufacture of jet skis ….….. Ö
o. Wages of an ironworker in the construction business Ö
p. Electricity used in lighting sales offices Ö
E1-6
When direct materials and supplies are purchased, the materials
E1-1
The variances for kitchen wages and utilities were favorable for September, whereas the variances for food and supplies were unfavorable. On a year-to-date basis, the only expense that did not have the same pattern as September was utilities which had a $120 F variance for the month, but an $850 U year-to-date variance. E1-2 No, the performance report should not be prepared just once a year. It should be furnished to managers at regular intervals, in this case monthly, on a timely basis. If it is not provided in a timely fashion, it will not be effective in controlling future operations.
E1-3
Merchandise inventory, January 1 $ 22,000
Plus purchases 183,000
Merchandise available for sale $ 205,000
Less merchandise inventory, January 31 17,000
Cost of goods sold $ 188,000
E1-4
Finished goods, July 1 $ 85,000
Plus cost of goods manufactured 343,000
Finished goods available for sale $ 428,000
Less finished goods, July 31 93,000
Cost of goods sold $ 335,000
E1-5 Selling & Direct Direct Factory Admin. Items Materials Labor Overhead Expense
a. Steel used in an overhead door plant Ö
b. Cloth used in a shirt factory Ö
c. Fiberglass used by a sailboat builder Ö
d. Cleaning solvent for the factory floor Ö
e. Wages of a binder employed in a printing plant Ö
f. Insurance on factory machines Ö
g. Rent paid for factory buildings Ö
h. Wages of the Machining Department supervisor Ö
i. Leather used in a shoe factory Ö
j. Wages of a factory janitor Ö
k. Electric power consumed in operating factory machines Ö
l. Depreciation on corporate offices Ö
m. Fuel used in heating a factory Ö
n. Paint used in the manufacture of jet skis ….….. Ö
o. Wages of an ironworker in the construction business Ö
p. Electricity used in lighting sales offices Ö
E1-6
When direct materials and supplies are purchased, the materials