1 - Fill the blank in the next exercise :

Campbell Manufacturing Company uses two departments to make its products. Department | is a cutting department that is machine intensive and uses very few employees. Machines cut and form parts and then place the finished parts on a conveyor belt that carries them to Department II, where they are assembled into finished goods. The assembly department is labor intensive and requires many workers to assemble parts into finished goods. The company's manufacturing facility incurs two significant overhead costs: employee fringe benets and utility costs. The annual costs of fringe benefits are $264,000 and utility costs are $192,000. The typical consumption patterns for the two departments are as follows: Department I Department II Total Machine hours used 15,700 4,300 20,000 Direct labor hours used 5,300 10,700 16,000 The supervisor of each department receives a bonus based on how well the department controls costs. The company's current policy requires using a single allocation base (machine hours or labor hours) to allocate the total overhead cost of $456,000. Required Required A Required E Required C 3. Assume that you are the supervisor of Department |. Choose the allocation base that would minimize your department's share of th Assume that you are the supervisor of Department 11. Choose the allocation base that would minimize yaurdepartmeni total overhead cost. Calculate the amount of overhead that would be allocated to both departments using the base that you share (If the total overhead cost. Calculate the amount of overhead that would be allocated to bath departments using selected. base that you selected. (Do not round intermediate calculations.) b. Assume that you are the supervisor of Department ll. Choose the allocation base that would minimize your department's share of the total overhead cost. Calculate the amount of overhead that would be allocated to both departments using the base that you _ selected. c. Assume that you are the plant manager and have the authority to change the company's overhead allocation policy. Formulate an I overhead allocation policy that would be fair to the supervisors of both Department | and Department ll. Compute the overhead ll allocations for each department using your policy. Complete this question by entering your answers in the tabs below. Required A Required B Required C Required A Required B Required C Identify the avoidable costs and determine the amount of avoidable cost for each product. Identify the fixed costs and determine the amount of fixed cost for each product. Avoidable Costs Bracelet A Bracelet B Fixed Costs Bracelet A Bracelet B Required B Required C Total fixed costs $ o $ Norman Dowd owns his own taxi, for which he bought a $13,000 permit to operate two years ago. Mr. Dowd earns $39,000 a year operating as an independent but has the opportunity to sell the taxi and permit for $46,000 and take a position as dispatcher for Carter Taxi Co. The dispatcher position pays $37,000 a year for a 40-hour week. Driving his own taxi, Mr. Dowd works approximately 55 hours per week. If he sells his business, he will invest the $46,000 and can earn a 11 percent return. Required 3. Determine the opportunity cost of owning and operating the independent business. b. Calculate the earnings of Norman Dowd operating as an independent and the earnings of Norman Dowd working as a dispatcher. Based solely on nancial considerations, should Mr. Dowd sell the taxi and accept the position as dispatcher? . Opportunity cost b. Operating as an independent Working as a dispatcher Should Mr. Dowd sell the taxi and accept the position as dispatcher? Gibson Company manufactures a personal computer designed for use in schools and markets it under its own label. Gibson has the capacity to produce 36,000 units a year but is currently producing and selling only 15,000 units a year. The computer's normal selling price is $1,720 per unit with no volume discounts. The unit-level costs of the computer's production are $440 for direct materials, $240 for direct labor, and $150 for indirect unit-level manufacturing costs. The total product and facility-level costs incurred by Gibson during the year are expected to be $2,240,000 and $811,000, respectively. Assume that Gibson receives a special order to produce and sell 3,070 computers at $1,250 each. Required Calculate the contribution to profit from the special order. Should Gibson accept or reject the special order? Contribution to prot Should Gibson accept or reject the special order? Adams Books buys books and magazines directly from publishers and distributes them to grocery stores. The wholesaler expects to purchase the following lnventory' Apr-11 May June Required purchases (on account) $165,068 $125,666 $137,680 Adams Books' accountant prepared the following schedule of cash payments for Inventory purchases. Adams Books' suppliers require that 85 percent of purchases on account be paid In the month of purchase; the remaining 15 percent are paid In the month following the month of purchase. Required 3. Complete the schedule of cash payments for inventory purchases by lling in the missing amounts. b. Determine the amount of accounts payable the company wrll report on its pro forma balance sheet at the end of the second quarter. Complete this question by entering your answers in the tabs below. Required A ' Required B Required A Required B Complete the schedule of cash Payments for inventory purchases by lling in the missing amounts Determine the amount of accounts payable the company will report on its pro forma balance sheet at the end of the seconc quarter. Payment for previous accounts payable 8,000 'he accountant for Perez's Dress Shop prepared the following cash budget. Perez's desires to maintain a cash cushion of $15,000 at he end of each month. Funds are assumed to be borrowed and repaid on the last day of each month. Interest is charged at the rate of percent per month. required 1. Complete the cash budget by lling in the missing amounts. I. Determine the amount of net cash flows from operating activities Perez's will report on the third quarter pro forma statement of cash flows. :. Determine the amount of net cash flows from financing activities Perez's will report on the third quarter pro forma statement of cash ows. Complete this question by entering your answers in the tabs below. Req A Req B and C Complete the rash budget by lling in the missing amounts. (Any shortages or repayments should be indicated with a minus sign. Round your answers to the nearest whole dollar amount.) Section 1: Cash receipts Beginning cash balance 35 48,000 Add cash receipts 191,000 211,000 251,600 W 239,000 Req A E Req B and c Section 2: Cash payments E Determine the amount of net cash ows from both operating and nancing activities Perez's will report on the third quarter For inventory purchases 171926 145'730 179'652 pro forma statement of cash ows. (Round intermediate calculations and nal answers to the nearest whole dollar amount.) For S&A expenses 60,000 66,060 66,932 For interest expense 0 W 231,026 Net cash (operating activities) Net cash (nancing activities) Section 3: Financing activities Surplus (shortage) 7,974