1: A foundry employee worked a normal 40-hour shift, but three hours were idle due to a small fire in the plant. The employee earns $16 per hour. Required: 1. Calculate the employee's total compensation for the week. 2. How much of this compensation is a direct-labor cost? How much is overhead? Question 2: Alexandria Aluminum Company, a manufacturer of recyclable soda cans, had the following inventory balances at the beginning and end of 20x1. Inventory Classification Raw material Work in process Finished goods January 1, 20x1 December 31, 20x1 $ 70,000 $ 50,000 120,00 115,00 0 0 140,00 165,00 0 0 During 20x1, the company purchased $260,000 of raw material and spent $400,000 on direct labor. Manufacturing overhead costs were as follows: Indirect material Indirect labor Depreciation on plant and equipment Utilities Other $ 11,000 26,000 100.00 0 27,000 30,000 Sales revenue was $1,111,000 for the year. Selling and administrative expenses for the year amounted to $110,000. The firm's tax rate is 40 percent. Required: 1. Prepare a schedule of cost of goods manufactured. 2. Prepare a schedule of cost of goods sold. 3. Prepare an income statement. Question 3: Water Technology, Inc., incurred the following costs during 20x1. The company sold all of its products manufactured during the year. 4,000,00 Direct material 2,400,00 Direct labor 0 Manufacturing overhead: Utilities (primarily electricity) 140,000 Depreciation on plant and equipment 230,000 Insurance 170,000 Supervisory salaries 200,000 Property taxes 210,000 Selling costs: Advertising 175,000 Sales commissions 70,000 Administrative costs: Salaries of top management and staff Office supplies 372,000 50,000 Depreciation on building and equipment 70,000 During 20x1, the company operated at about half of its capacity, due to a slowdown in the economy. Prospects for 20x2 are slightly better. Jared Lowes, the marketing manager, forecasts a 20 percent growth in sales over the 20x1 level. Required: Categorize each of the costs listed below as to whether it is most likely variable or fixed. Forecast the 20x2 cost amount for each of the cost items listed. 1 Page