2 weeks ago

(WIP) ACC 350 Exam 1 Study Material

Work in Process

Spade Pit H chz : In -

Spade Pit H chz : In - class Problem ACC 350 In-Class Problems – Chapter 2 #1 – Identify Costs The Temp Company manufactures bicycles and has the following costs: DM DL MOH Period or Product Fixed or Variable 1. Assembly-line worker’s salary 2. Factory heating and air conditioning 3. Salaries of the company’s top executives 4. Sales Commissions 5. Production supervisor’s salary 6. Research and development costs 7. Chains used to make bicycles 8. Supplies (e.g. lubricant) used to make bicycles 9. Freight-in on direct materials 10. Freight-out to ship goods 11. Quality inspectors’ salaries 12. Material handler salaries 13. Process design engineer salaries 14. Electricity for the machines 15. Overtime premium paid to assembly workers 16. Property taxes on the factory & office 17. Office rental for cost-management staff Identify each cost as Direct Material (DM), Direct Labor (DL), or Manufacturing Overhead (MOH), as a Period or Product Cost, and as a Fixed or Variable Cost.

p . Be 7-15 #2 – COGM / COGS Hanks Corporation produced 120,000 toy pianos last year. These pianos sell for $100 each. Hanks had 11,350 pianos in finished goods inventory at the beginning of the year. At the end of the year, there were 7,600 pianos in finished goods inventory. Hanks uses FIFO method of accounting and the accounting records from last year show the following information a. Purchases of Raw Materials $900,000 b. Rent on the factory building 250,000 c. Utilities (50% factory, 50% sales office) 60,000 d. Insurance on the factory 10,000 e. Depreciation, factory equipment 70,000 f. General Administration 175,000 g. Raw Materials used as supplies 35,000 h. Plant receptionist, Plant landscaping, etc. 100,000 i. Salaries Direct labor 2,500,000 Factory Supervisors 500,000 Plant Manager 90,000 Plant Controller 40,000 Receiving personnel 60,000 Quality Inspectors 150,000 Salespeople 300,000 Machine Maintenance salary 100,000 RM Inventory manager 40,000 Total Salaries 3,780,000 Raw Materials Inventory, January 1 310,000 Raw Materials Inventory, December 31 100,000 Work In Process Inventory, January 1 450,000 Work In Process Inventory, December 31 600,000 Finished Goods Inventory, January 1 454,000