ACCT 4001 - Government and Nonprofit Accounting
28. ABC Ltd. maintains a margin of safety of 37.5% with an overall contribution to sales ratio of 40%....
ABC Ltd. maintains a margin of safety of 37.5% with an overall contribution to sales ratio of 40%. Its fixed costs amount to Rs.5, 00,000. Calculate the following:
1. Break Even Sales
2. Total Sales
3. Total Variable Sales
4. Current Profits
5. New ‘Margin of Safety’ if the sales volume is increased by 7.5%
29. Write a PYTHON program to calculate the bill amount for an item given its quantity sold, value,...
Write a PYTHON program to calculate the bill amount for an item given its quantity sold, value, discount, and tax.
The user is to enter these :
Enter the quantity of item sold :
Enter the value of item :
Enter the the discount percentage :
Enter the tax :
Formulaes: amountt = quantity X value
discount amount = amount X discount/100
subtotal = amount – discount amount
tax amount = subtotal X tax/100
total amount = subtotal + tax amount
The output should look like this:
>>>
Enter the quantity of item sold : 80
Enter the value of item : 100
Enter the the discount percentage : 10
Enter the tax : 14
BILL*
Quantity sold : 80.00
Price per item : 100.00
-----------------
Amount : 8,000.00
Discount : - 800.00
-----------------
Discounted Total : 7,200.00
Tax : + 1,008.00
-----------------
Total amount to be paid $ 8,208.00
>>>
30. The upper bound on the time complexity of the nondeterministic sorting algorithm is (a) O(n) (b) O(n
The upper bound on the time complexity of the nondeterministic sorting algorithm is (a) O(n)
(b) O(n log n)
(c) O(1)
(d) O( log n)
(e) O(n2).
31. A retailer is considering the purchase of 250 units of a specific item from either of two suppliers.
Purchase-related transactions
A retailer is considering the purchase of 250 units of a specific item from either of two suppliers. Their offers are as follows: Supplier One: $400 a unit, total of $100,000, 1/10, n/30, no charge for freight. Supplier Two: $399 a unit, total of $99,750, 2/10, n/30, plus freight of $975. Which of the two offers, Supplier One or Supplier Two, yields the lower price?
32. Miller Company’s most recent contribution format
Miller Company’s most recent contribution format income statement is shown below:
Required:
Prepare a new contribution format income statement under each of the following conditions (consider each case independently):
1. The number of units sold increases by 15%.
2. The selling price decreases by $1.50 per unit, and the number of units sold increases by 25%.
3. The selling price increases by $1.50 per unit, fixed expenses increase by $20,000, and the number of units sold decreases by 5%.
4. The selling price increases by 12%, variable expenses increase by 60 cents per unit, and the number of units sold decreases by10%.
33. Huron Company produces a commercial cleaning compound known as Zoom. The direct materials and dir...
Huron Company produces a commercial cleaning compound known as Zoom. The direct materials and direct labor standards for one unit of Zoom are given below: Standard Quantity or Standard Price Standard Hours or Rate Cost Direct materials 7.1 pounds 2.50 per pound $17.75 Direct labor 0.5 hours $14.50 per hour 7.25 During the most recent month, the following activity was recorded: a. Thirteen thousand eight hundred pounds of material were purchased at a cost of $2.40 per pound. b. The company produced only 1,380 units, using 12,420 pounds of material. The rest of the material purchased remained in raw materials inventory.) c. Seven hundred and ninety hours of direct labor time were recorded at a total labor cost of $9,480 Required: Compute the materials price and quantity variances for the month. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Do not round intermediate calculations.) Answer is not complete F Direct materials price variance U Direct materials quantity 6,555 variance
34. RATIO ANALYSIS The following data apply to A.L. Kaiser & Company (millions of dollars): Cash and...
RATIO ANALYSIS The following data apply to A.L. Kaiser & Company (millions of dollars):
Cash and equivalents | $100.00 |
Fixed assets | 283.50 |
Sales | 1,000.00 |
Net income | 50.00 |
Current liabilities | 105.50 |
Current ratio | 3.00× |
DSOa | 40.55 days |
ROE | 12.00% |
aThis calculation is based on a 365-day year.
Kaiser has no preferred stock—only common equity, current liabilities, and long-term debt.
a. Find Kaiser’s (1) accounts receivable, (2) current assets, (3) total assets, (4) ROA, (5) common equity, (6) quick ratio, and (7) long-term debt.
b. In Part a, you should have found that Kaiser’s accounts receivable (A/R) = $111.1 million. If Kaiser could reduce its DSO from 40.55 days to 30.4 days while holding other things constant, how much cash would it generate? If this cash were used to buy back common stock (at book value), thus reducing common equity, how would this affect (1) the ROE, (2) the ROA, and (3) the total debt/total assets ratio?
35. What are the primary differences between the Baumol and Miller- Orr models of cash management?
What are the primary differences between the Baumol and Miller- Orr models of cash management?
36. 86.Portia Grant is an employee who is paid monthly. For the month of January of the current year,...
86.Portia Grant is an employee who is paid monthly. For the month of January of the current year, she earned a total of $8,260. The FICA tax for social security is 6.2% and the FICA tax rate for Medicare is 1.45%. The FUTA tax rate of .6% and the SUTA tax rate of 5.4% are applied to the first $7,000 of an employee's pay. The amount of federal income tax withheld from her earnings was $1,325.17. Her net pay for the month is:
A. $6,422.71
B. $6,246.94
C. $6,302.94
D. $5,868.94
E. $7,194.11
Net Pay = Gross Pay - Federal Income Tax - FICA-SS Tax - FICA-Medicare Tax
Net Pay = $8,260.00 - $1,325.17 - $512.12 - $119.77* = $6,302.94
FICA-SS Tax $8,260.00 0.062 = $512.12
FICA-Medicare Tax $8,260.00 * 0.0145 = $119.77
87.Portia Grant is an employee who is paid monthly. For the month of January of the current year, she earned a total of $8,260. The FICA tax for social security is 6.2% and the FICA tax rate for Medicare is 1.45%. The FUTA tax rate of 0.6% and the SUTA tax rate of 5.4% are applied to the first $7,000 of an employee's pay. The amount of federal income tax withheld from her earnings was $1,325.17. What is the total amount of taxes withheld from the Portia's earnings?
A. $3,097.17
B. $2,443.21
C. $1,957.06
D. $1,722.00
E. $1,495.36
Total Taxes = Federal Income Tax + FICA-SS Tax + FICA-Medicare Tax
Total Taxes = $1,325.17 + $512.12 + $119.77 = $1,957.06
FICA-SS Tax $8,260.00 0.062 = $512.12
FICA-Medicare Tax $8,260.00 * 0.0145 = $119.77
88.Trey Morgan is an employee who is paid monthly. For the month of January of the current year, he earned a total of $4,538. The FICA tax for social security is 6.2% and the FICA tax rate for Medicare is 1.45% for both the employee and the employer. The amount of federal income tax withheld from his earnings was $680.70. His net pay for the month is:
A. $3,510.14
B. $3,857.30
C. $4,190.84
D. $4,538.00
E. $3,162.98
Net Pay = Gross Pay - Federal Income Tax - FICA-SS Tax - FICA-Medicare Tax
Net Pay = $4,538.00 - $680.70 - $281.36 - $65.80* = $3,510.14
FICA-SS Tax $4,538.00 0.062 = $281.36
FICA-Medicare Tax $4,538.00 * 0.0145 = $65.80
89.Trey Morgan is an employee who is paid monthly. For the month of January of the current year, he earned a total of $4,538. The FICA tax for social security is 6.2% and the FICA tax rate for Medicare is 1.45% for both the employee and the employer. The amount of federal income tax withheld from his earnings was $680.70. What is the total amount of taxes withheld from the Trey's earnings?
A. $1,375.02
B. $746.50
C. $962.06
D. $1,027.86
E. $680.70
Total Taxes = Federal Income Tax + FICA-SS Tax + FICA-Medicare Tax
Total Taxes = $680.70 + $281.36 + $65.80* = $1,027.86
FICA-SS Tax $4,538.00 0.062 = $281.36
FICA-Medicare Tax $4,538.00 * 0.0145 = $65.80
90.The annual Federal Unemployment Tax Return is:
A. Form 940.
B. Form 1099.
C. Form 104.
D. Form W-2.
E. Form W-4.
91.The Wage and Tax Statement given to each employee annually is:
A. Form 940.
B. Form 941.
C. Form 1040.
D. Form W-2.
E. Form W-4.
92.A bank that is authorized to accept deposits of amounts payable to the federal government is a:
A. Credit union.
B. FDIC insured bank.
C. Federal depository bank.
D. National bank.
E. Federal Reserve Bank.
93.An employer's federal unemployment taxes (FUTA) are reported:
A. Annually.
B. Semiannually.
C. Quarterly.
D. Monthly.
E. Weekly.
94.The rate that a state assigns reflecting a company's stability or instability in employing workers is the:
A. FICA rate.
B. Tax withholding rate.
C. Pay rate.
D. Credit rating.
E. Merit rating.
95.Employer payroll taxes:
A. Are added expenses beyond that for the wages and salaries earned by employees.
B. Represent the federal taxes withheld from employees.
C. Represent the social security taxes withheld from employees.
D. Are paid by the employee.
E. Are payable for up to a maximum $117,000 of employee earnings.
37. DISCUSSION ACTIVITY You have just been advised that your organization is opening an office in...
DISCUSSION ACTIVITY
You have just been advised that your organization is opening an office in Québec. Describe the employer contributions that are specific to the province of Québec, their rates, and thresholds where available. (Do not include the organization’s portion of the statutory deductions.)
38. Why is it important to organizationally separate the accounting function from other functions of the...
1. Why is it important to organizationally separate the accounting function from other functions of the organization?
2. What is the most likely system acquisition method—in-house, turnkey, backbone, or vendor-supported—for each of the following situations?
• A plumbing supply company with 12 employees that sells standard products to wholesale customers in a local community needs a system to manage its affairs.
• A major oil company with diverse holdings, complex oil leases, and esoteric accounting practices needs a system that can coordinate its many enterprises.
• A municipal government needs a system that complies with standard government accounting practices but can be integrated with other existing systems.
3. The REA model is based on the premise that “business data must not be preformatted or artificially constrained and must reflect all relevant aspects of the underlying economic events.” What does this mean and how is it applied?
4. ERP systems are composed of a highly integrated set of standardized modules. Discuss the advantages and potential disadvantages of this approach.
39. Morrisey & Brown, Ltd., of Sydney is a merchandising company
Morrisey & Brown, Ltd., of Sydney is a merchandising company that is the sole distributor of a product that is increasing in popularity among Australian consumers. The company’s income statements for the three most recent months follow:
Required:
1. Identify each of the company’s expenses (including cost of goods sold) as either variable fixed, or mixed.
2. Using the high-low method, separate each mixed expense into variable and fixed elements. State the cost formula for each mixed expense.
3. Redo the company’s income statement at the 5,000-unit level of activity using the contributionformat.
40. The university has decided that for the following year, lecture costs will increase by 20%, workshop
The university has decided that for the following year, lecture costs will increase by 20%, workshop costs by 10% and examination costs will stay the same for level 2 the current hourly costs are $10, $24, and $60 respectively. how much would the level 2 course cost the following year?
41. 58.Which of the following is not a management function? a.Constraining b.Planning c.Controlling...
58.Which of the following is not a management function?
a.Constraining
b.Planning
c.Controlling
d.Directing and motivating
59.A manager that is establishing objectives is performing which management function?
a.Controlling
b.Directing
c.Planning
d.Constraining
60.The document of an organization that depicts authority relationships within the company is the
a.organization's charter.
b.organization's indenture.
c.organization chart.
d.authority outline.
61.In determining whether planned goals are being met, a manager is performing the function of
a.planning.
b.follow-up.
c.directing.
d.controlling.
62.Which of the following is not a separate management function?
a.Planning
b.Directing
c.Decision-making
d.Controlling
63.Directing and motivating includes
a.providing a framework for management to have criteria to terminate employees when needed.
b.running a department under quality control standards universally accepted.
c.coordinating a company's diverse activities and human resources to produce a smooth-running operation.
d.developing a complex performance ranking system to give certain high performers good raises.
64.Both direct materials and indirect materials are
a.raw materials.
b.manufacturing overhead.
c.merchandise inventory.
d.sold directly to customers by a manufacturing company.
65.The work of factory employees that can be physically and directly associated with converting raw materials into finished goods is
a.manufacturing overhead.
b.indirect materials.
c.indirect labor.
d.direct labor.
66.Which one of the following would not be classified as manufacturing overhead?
a.Indirect labor
b.Direct materials
c.Insurance on factory building
d.Indirect materials
67.Manufacturing costs include
a.direct materials and direct labor only.
b.direct materials and manufacturing overhead only.
c.direct labor and manufacturing overhead only.
d.direct materials, direct labor, and manufacturing overhead.
42. Bhagwati Ltd. invited applications for issuing 2,00,000 equity shares of< 10 each. The amounts...
Bhagwati Ltd. invited applications for issuing 2,00,000 equity shares of< 10 each. The amounts were payable as follows :On application – < 3 per shareOn allotment – < 5 per shareOn first and final call – < 2 per shareApplications were received for 3,00,000 shares and pro-rata allotmentwas made to all the applicants. Money overpaid on application wasadjusted towards allotment money. B, who was allotted 3,000 shares,failed to pay the first and final call money. His shares were forfeited. Outof the forfeited shares, 2,500 shares were reissued as fully paid up @ < 8per share.Pass necessary journal entries to record the above transactions in thebooks of Bhagwati Ltd.
43. Multiple Choice Questions 1. Which of the following is an intangible asset? a. Franchise b. Oil...
Multiple Choice Questions 1. Which of the following is an intangible asset? a. Franchise b. Oil reserves c. Land d. Repairs 2. Depreciation is the systematic allocation of the cost of an asset a. Over the periods during which the asset is paid for. b. Over the periods during which the market value of the asset decreases. c. Over the periods during which the company uses the asset. d. Over the life of the company. 3. Writing off a cost means a. Putting the cost on the balance sheet as an asset. b. Evaluating the useful life of the asset. c. Recording the cost as an expense. d. Deferring the expense. 4. Suppose a firm purchases a new building for $500,000 and spends an additional $50,000 making alterations to it before it can be used. How much will the firm record as the cost of the asset? a. $500,000 b. $550,000 c. $450,000 d. It depends on who performed the alterations. 5. Suppose a firm buys a piece of land with a building for $100,000. The firm’s accountant wants to divide the cost between the land and building for the firm’s financial records. Why? a. Land is always more expensive than buildings. b. Land will not be depreciated but the building will be depreciated, so the accountant needs two different amounts. c. Land will appreciate and its recorded cost will increase over time, whereas the building will be depreciated. d. Depreciation expense will be separated from accumulated depreciation after the first year. 6. When an expenditure to repair
44. 1. Which of the following would least likely use a process costing system? a. Manufacturer of custom
1. Which of the following would least likely use a process costing system? a. Manufacturer of custom furniture b. Manufacturer of soft drinks c. Manufacturer of gasoline d. Manufacturer of paper 2. Which of the following is not a basic objective of process costing? a. Compute an average cost per unit since units are homogeneous b. Allocate production costs between whole units and partial units c. Separate production costs into fixed and variable components d. Determine the amount of production costs that should be transferred to the next department 3. Select the incorrect statement regarding equivalent units of production (EUP). a. Two units 50% complete are equivalent to one unit 100% complete. b. Except in very rare instances, only one EUP calculation is needed per department. c. EUP equals the number of whole units of output that could have been produced during a period from the actual effort expended. d. The objective of EUP calculations is to eliminate the costing problem caused by partially completed units. 4. The steps in process costing are listed below: 1 – Calculate physical units to be accounted for 2 – Calculate physical units accounted for 3 – Calculate equivalent units of production (EUP) 4 – Calculate total costs to be accounted for 5 – Calculate the cost per EUP 6 – ? What is the missing step? a. Assign costs to whole and partial units in ending inventory b. Assign costs to whole units produced during the period c. Assign costs to units started and completed during the period d. Assign costs to units transferred out and units in ending inventory 5. Which of the following is true about the weighted average method of process costing? a. The calculation of EUP must take into consideration the units in both beginning and ending inventory. b. The cost per EUP will include prior period costs if the department had beginning inventory. c. The most common alternative to the weighted average method is the last-in, first-out method. d. The weighted average method refers to a method of determining which units were sold and which units remain in inventory ====================================================== Use the following information for the next three questions. Z Company employs a process costing system for its manufacturing operations. All direct materials are added at the beginning of the process and conversion costs are added proportionately. The production quantity schedule for April is reproduced below: Units Work in process on April 1 (60% complete as to conversion costs) 1,000 Units started during April 5,000 Total units to account for 6,000 Units completed and transferred out 4,000 Work in process on April 30 (20% complete as to conversion costs) 2,000 Total units accounted for 6,000 Costs pertaining to the month of April are as follows: Beginning inventory costs: (DM, $54,600; Conversion, $35,560) $ 90,160 Costs incurred during April (DM, $468,000; Conversion $574,060) $1,042,060 6. Using the weighted average method, the equivalent units for direct materials for April are: a. 6,000 units. b. 5,000 units. c. 4,400 units. d. 3,800 units. 7. Using the weighted average method, the equivalent units for conversion costs for April are: a. 6,000 units. b. 5,000 units. c. 4,400 units. d. 3,800 units. 8. Using the weighted average method, the equivalent unit materials cost for April is: a. $78.00. b. $87.10. c. $130.65. d. $138.55. 9. Using the weighted average method, the 4,000 units completed during April will be transferred out at an EUP unit cost of: a. $188.69. b. $225.65. c. $257.31. d. $283.04. ============================================== Use the following information for the next two questions. L Company uses a process cost system to account for its manufacturing operations. All direct materials are added at the beginning of the process and conversion costs are added proportionately. The production quantity schedule for June is reproduced below: Units Work in process on June 1 (20% complete as to conversion costs) 16,000 Units started during June 100,000 Total units to account for 116,000 Units completed and transferred out from beginning inventory 16,000 Units started and completed during June 76,000 Work in process on June 30 (40% complete as to conversion costs) 24,000 Total units accounted for 116,000 Costs pertaining to the month of June are as follows: Beginning inventory costs: (DM, $54,600; Conversion, $35,560) $ 90,160 Costs incurred during June (DM, $468,000; Conversion $574,060) $1,042,060 10. Using the FIFO method, the equivalent units for direct materials for June are: a. 116,000 units. b. 100,000 units. c. 85,600 units. d. 76,000 units. 11. Using the FIFO method, the equivalent units for conversion costs for June are: a. 116,000 units. b. 100,000 units. c. 98,400 units. d. 76,000 units. 12. Using the FIFO method, the direct materials cost per equivalent unit for units started and completed during June is: a. $6.16. b. $6.00. c. $5.23. d. $4.68. 13. Select the incorrect statement concerning process costing in a multidepartment setting. a. In this environment, goods are transferred from a predecessor (upstream) department to a successor (downstream) department. b. Transferred out costs of the predecessor department become transferred in costs of the successor department. c. Occasionally, successor departments will change the unit of measure used in predecessor departments. d. By definition, successor departments may not add any additional raw materials to the units received from predecessor departments. 14. Which of the following statements is true concerning process costing? a. Companies my substitute standard costs for actual costs. b. EUP calculations for standard process costing are identical to those of FIFO process costing. c. An advantage of standard process costing is that material, labor, and overhead variances can be computed to assist in performance evaluation. d. All of the above are true. 15. An appropriate costing system for a company whose various product lines have different direct materials but similar processing techniques is likely a a. weighted average method of process costing. b. first-in, first out method of process costing. c. hybrid method of process costing. d. last-in, first out method of process costing
45. In each of the following situations, determine whether job costing or process costing would be more
In each of the following situations, determine whether job costing or process costing would be more appropriate. 1. A CPA Firm 2. An oil refinery 3. A custom furniture manufacturer 4. A tire manufacturer 5. A textbook publisher 6. A pharmaceutical company 7. An advertising agency 8. An apparel manufacturing plant 9. A flour mill 10. A paint manufacturer 11. A medical care facility 12. A landscaping company 13. A movie studio 14. A law firm 15. A breakfast-cereal company 16. A catering service 17. A paper mill 18. An auto repair shop The Lynn Company uses a job-costing system at its Minneapolis plant. The plant has a machining department and an assembly department. Its job-costing system has two manufacturing overhead cost pools (the machining department overhead, applied to jobs based on actual machine-hours, and the assembly department overhead, applied to jobs based on actual direct manufacturing labor costs). The 2014 budget for the plant was as follows: Machining Dept Assembly Dept Factory overhead $1,800,000 $3,600,000 Direct labor costs $1,400,000 $2,000,000 Direct labor-hours 100,000 200,000 Machine-hours 50,000 200,000 1. Compute the budgeted manufacturing overhead rate for each department. 2. During February, the job-cost records for Job 494 contained the following: Machining Dept Assembly Dept Direct materials used $45,000 $70,000 Direct labor costs $14,000 $15,000 Direct labor-hours 1,000 1,500 Machine-hours 2,000 1,000 Compute the total manufacturing overhead costs allocated to Job 494. 3. At the end of 2014, the actual manufacturing overhead costs were $2,100,000 in machining and $3,700,000 in assembly. 55,000 actual machine-hours were used in machining and direct manufacturing labor costs in assembly were $2,200,000. Compute the over- or under applied manufacturing overhead for each department. 4. Determine the over- or under applied manufacturing overhead for Lynn Co. and prepare the adiusting entry
46. Business Entity Concept - Advantage and disadvantage of business entity concept
Advantage and disadvantage of business entity concept
48. The following transactions occur for Badger Biking Company during the month of June: a. Provide ...
The following transactions occur for Badger Biking Company during the month of June: a. Provide services to customers on account for $40.000. b. Receive cash of $32.000 from customers in (a) above. c. Purchase bike equipment by signing a note with the bank for $25,000. d. Pay utilities of S4.000 for the current month. Analyze each transaction and indicate the amount of increases and decreases in the accounting equation.
49. At the end of its first year, the trial balance of Rayburn Company shows Equipment $22,000 and...
At the end of its first year, the trial balance of Rayburn Company shows Equipment $22,000 and zero balances in Accumulated Depreciation—Equipment and Depreciation Expense. Depreciation for the year is estimated to be $2,750. Prepare the annual adjusting entry for depreciation at December 31, post the adjustments to T-accounts, and indicate the balance sheet presentation of the equipment at December 31.
50. The following data are for the two products produced by Tadros Company Product A Product B 14 per...
The following data are for the two products produced by Tadros Company Product A Product B 14 per unit 27 per unit Direct materials Direct labor hours 0.3 DLH per unit 1.6 DLH per unit Machine hours 0.2 MH per unit 1.2 MH per unit 90 batches 180 batches Batches Volume 10,000 units 2,000 units Engineering modifications 11 modifications 55 modifications 500 customers 400 customers Number of customers 35 per unit 95 per unit Market price The company's direct labor rate is $20 per direct labor hour (DLH). Additional information follows. Costs Driver Indirect manufacturing 23,000 Engineering modifications Engineering support 22,000 Machine hours Electricity Setup costs 43,000 Batches Nonmanufacturing 72,000 Number of customers Customer service