管理会计作业1解析.docx

管理会计作业1解析.docx

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管理会计作业1解析

Assignment1

1.ContributionFormatversusTraditionalIncomeStatement

Marwick’sPianos,Inc.,purchasespianosfromalargemanufacturerandsellsthemattheretaillevel.Thepianoscost,ontheaverage,$125eachfromthemanufacturer.Marwick’sPianos,Inc.,sellsthepianostoitscustomersatanaveragepriceof$250each.Thesellingandadministrativecoststhatthecompanyincursinatypicalmontharepresentedbelow:

Costs

CostFormula

Selling:

Advertising

$800

permonth

Salessalariesandcommissions

$1,200

permonth,plus10%ofsales

Deliveryofpianostocustomers

$15

perpianosold

Utilities

$500

permonth

Depreciationofsalesfacilities

$750

permonth

Administrative:

Executivesalaries

$2,000

permonth

Insurance

$250

permonth

Clerical

$700

permonth,plus$5perpianosold

Depreciationofofficeequipment

$400

permonth

DuringJune,Marwick’sPianos,Inc.,soldanddelivered100pianos.

Required:

1.PrepareanincomestatementforMarwick’sPianos,Inc.,forJune.Usethetraditionalformat,withcostsorganizedbyfunction.

2.Redo

（1）above,thistimeusingthecontributionformat,withcostsorganizedbybehavior.Showcostsandrevenuesonbothatotalandaperunitbasisdownthroughcontributionmargin.

3.Refertotheincomestatementyoupreparedin

（2）above.Whymightitbemisleadingtoshowthefixedcostsonaperunitbasis?

2.SalesMix;Break-EvenAnalysis;MarginofSafety

IslandNovelties,Inc.,ofPalaumakestwoproducts,HawaiianFantasyandTahitianJoy.Presentrevenue,cost,andsalesdataforthetwoproductsfollow:

HawaiianFantasy

TahitianJoy

Sellingpriceperunit

$20.00

$25.00

Variableexpensesperunit

$14.00

$10.00

Numberofunitssoldannually

25,000

10,000

Fixedexpensestotal$270,000peryear.TheRepublicofPalauusestheU.S.dollarasitscurrency.

Required:

1.Assumingthesalesmixgivenabove,dothefollowing:

a.Prepareacontributionformatincomestatementshowingbothdollarandpercentcolumnsforeachproductandforthecompanyasawhole.

b.Computethebreak-evenpointindollarsforthecompanyasawholeandthemarginofsafetyinbothdollarsandpercent.

2.ThecompanyhasjustdevelopedanewproducttobecalledSamoanDelight.Assumethatthecompanycouldsell12,000unitsat$17.50each.Thevariableexpenseswouldbe$14.00each.Thecompany’sfixedexpenseswouldnotchange.

a.Prepareanothercontributionformatincomestatement,includingsalesoftheSamoanDelight（salesoftheothertwoproductswouldnotchange）.

b.Computethecompany’snewbreak-evenpointindollarsandthenewmarginofsafetyinbothdollarsandpercent.

3.Thepresidentofthecompanyexaminesyourfiguresandsays,“There’ssomethingstrangehere.Ourfixedcostshaven’tchangedandyoushowgreatertotalcontributionmarginifweaddthenewproduct,butyoualsoshowourbreak-evenpointgoingup.Withgreatercontributionmargin,thebreak-evenpointshouldgodown,notup.You’vemadeamistakesomewhere.”Explaintothepresidentwhathashappened.

3.ChangesinFixedandVariableCosts;Break-EvenandTargetProfitAnalysis

NeptuneCompanyproducestoysandotheritemsforuseinbeachandresortareas.Asmall,inflatabletoyhascomeontothemarketthatthecompanyisanxioustoproduceandsell.Thenewtoywillsellfor$5.50perunit.Enoughcapacityexistsinthecompany’splanttoproduce20,000unitsofthetoyeachmonth.Variablecoststomanufactureandselloneunitwouldbe$2.75,andfixedcostsassociatedwiththetoywouldtotal$70,000permonth.

Thecompany’sMarketingDepartmentpredictsthatdemandforthenewtoywillexceedthe20,000unitsthatthecompanyisabletoproduce.Additionalmanufacturingspacecanberentedfromanothercompanyatafixedcostof$5,000permonth.Variablecostsintherentedfacilitywouldtotal$3.00perunit,duetosomewhatlessefficientoperationsthaninthemainplant.

Required:

1.Computethemonthlybreak-evenpointforthenewtoyinunitsandintotaldollarsales.Showallcomputationsingoodform.

2.Howmanyunitsmustbesoldeachmonthtomakeamonthlyprofitof$3,000?

3.Ifthesalesmanagerreceivesabonusof5centsforeachunitsoldinexcessofthebreak-evenpoint,howmanyunitsmustbesoldeachmonthtoearnareturnof4.9%onthemonthlyinvestmentinfixedcosts?

4.ScheduleofCostofGoodsManufactured;IncomeStatement;CostBehavior

SelectedaccountbalancesfortheyearendedDecember31areprovidedbelowforSuperiorCompany:

Sellingandadministrativesalaries

$80,000

Insurance,factory

$4,500

Utilities,factory

$20,000

Purchasesofrawmaterials

$155,000

Indirectlabor

$36,000

Directlabor

?

Advertisingexpense

$32,000

Cleaningsupplies,factory

$3,000

Salescommissions

$60,000

Rent,factorybuilding

$100,000

Maintenance,factory

$25,000

Inventorybalancesatthebeginningandendoftheyearwereasfollows:

Beginningof

Endof

theYear

theYear

Rawmaterials

$13,000

$18,000

Workinprocess

?

$21,500

Finishedgoods

$31,000

?

Thetotalmanufacturingcostsfortheyearwere$399,500;thegoodsavailableforsaletotaled$434,000;andthecostofgoodssoldtotaled$405,600.

Required:

1.Prepareascheduleofcostofgoodsmanufacturedandthecostofgoodssoldsectionofthecompany’sincomestatementfortheyear.

2.Thecompanyproducedtheequivalentof25,000unitsduringtheyear.Computetheaveragecostperunitfordirectmaterialsusedandtheaveragecostperunitforrentonthefactorybuilding.

3.Inthefollowingyearthecompanyexpectstoproduce20,000units.Whataveragecostperunitandtotalcostwouldyouexpecttobeincurredfordirectmaterials?

Forrentonthefactorybuilding?

（Assumethatdirectmaterialsisavariablecostandthatrentisafixedcost.）

4.Explaintothepresidentthereasonforanydifferenceintheaveragecostperunitbetween

（2）and（3）above.

5.High-LowMethod;CostofGoodsManufactured

CarlyleCompanymanufacturesasingleproduct.Thecompanykeepscarefulrecordsofmanufacturingactivitiesfromwhichthefollowinginformationhasbeenextracted:

LevelofActivity

January–Low

April–High

Numberofunitsproduced

7,200

9,000

Costofgoodsmanufactured

$225,000

$270,000

Workinprocessinventory,beginning

$4,500

$14,400

Workinprocessinventory,ending

$5,400

$8,100

Directmaterialscostperunit

$3.60

$3.60

Directlaborcostperunit

$7.50

$7.50

Manufacturingoverheadcost,total

?

?

Thecompany’smanufacturingoverheadcostconsistsofbothvariableandfixedcostelements.Tohavedataavailableforplanning,managementwantstodeterminehowmuchoftheoverheadcostisvariablewithunitsproducedandhowmuchofitisfixedpermonth.

Required:

1.ForbothJanuaryandApril,estimatetheamountofmanufacturingoverheadcostaddedtoproduction.Thecompanyhadnounderappliedoroverappliedoverheadineithermonth.（Hint:

Ausefulwaytoproceedmightbetoconstructascheduleofcostofgoodsmanufactured.）

2.Usingthehigh-lowmethod,estimateacostformulaformanufacturingoverhead.Expressthevariableportionoftheformulaintermsofavariablerateperunitofproduct.

3.If8,400unitsareproducedduringamonth,whatwouldthecostofgoodsmanufacturedbe?

（Assumethatworkinprocessinventoriesdonotchangeandthatoverheadcostisneitherunderappliednoroverappliedforthemonth.）

6.High-LowAnalysisandPredictingCost

ProsperoCorporation’stotaloverheadcostsatvariouslevelsofactivityarepresentedbelow:

Month

Machine-Hours

TotalOverheadCosts

August

8,000

$119,400

September

12,000

$142,800

October

16,000

$166,200

November

4,000

$93,120

Assumethatthetotaloverheadcostsaboveconsistofutilities,supervisorysalaries,andmaintenance.Thebreakdownofthesecostsatthe4,000machine-hourlevelofactivityis:

Utilities（variable）

$11,520

Supervisorysalaries（fixed）

15,600

Maintenance（mixed）

  66,000

Totaloverheadcosts

$93,120

ProsperoCorporation’smanagementwantstobreakdownthemaintenancecostintoitsbasicvariableandfixedcostelements.

Required:

1.Estimatehowmuchofthe$166,200ofoverheadcostinOctoberwasmaintenancecost.（Hint:

todothis,itmaybehelpfultofirstdeterminehowmuchofthe$166,200consistedofutilitiesandsupervisorysalaries.Thinkaboutthebehaviorofvariableandfixedcosts!

）

2.Usingthehigh-lowmethod,estimateacostformulaformaintenance.

3.Expressthecompany’stotaloverheadcostsinthelinearequationformY=a+bX.

4.Whattotaloverheadcostswouldyouexpecttobeincurredatanoperatingactivitylevelof15,000machine-hours?

7.High-LowMethod;PredictingCost

SusumiCorporation,ofJapanisamanufacturingcompanywhosetotalfactoryoverheadcostsfluctuateconsiderablyfromyeartoyearaccordingtoincreasesanddecreasesinthenumberofdirectlabor-hoursworkedinthefactory.Totalfactoryoverheadcosts（inJapaneseyen,denotedby¥）athighandlowlevelsofactivityforrecentyearsaregivenbelow:

LevelofActivity

Low

High

Directlabor-hours

5,000

6,000

Totalfactoryoverheadcosts

¥14,000,000

¥15,150,000

Thefactoryoverheadcostsaboveconsistofindirectmaterials,rent,andmaintenance.Thecompanyhasanalyzedthesecostsatthe5,000-hourlevelofactivityasfollows:

Indirectmaterials（variable）

¥  2,500,000

Rent（fixed）

7,000,000

Maintenance（mixed）

    4,500,000

Totalfactoryoverheadcosts

¥14,000,000

Tohavedataav