1. Ziscosteel, a manufacturer of recyclable plastic bags, had the following inventory balances at the beginning of...
Question:
1. Ziscosteel, a manufacturer of recyclable plastic bags, had the following inventory balances at the beginning of 2012
INVENTORY CLASSIFICATION 1-Jan-18 31-Dec-18
Raw Material 40,000.00 50,000.00
Work In Progress 180,000.00 139,000.00
Finished Goods 150,000.00 165,000.00
During the year, the company purchased $250 000 of raw material and spent
$400 000 on direct labor. The manufacturing overhead costs were as follows:
indirect material 50,000.00
Indirect labor 25,000.00
Depreciation on plant equipment 13,000.00
Utilities 25,230.00
Other 30,000.00
Sales revenue for the year was $1 105 000.00. Selling and administrative expenses for the year amounted to 1100 00.00. The firm's tax rate is 40%.
a) set a schedule for set a schedule of cost of goods manufactured
b) Establish the cost of goods sold
c) Construct an income statement
2) Evaluate how both cost schedules and income statement will change if the following data changes:
i) Direct labor is 690000.00
ii) Utilities cost is 115000.00
3) Discuss how the management accountant assists the top management making decisions
4) Annex corporation's comparative balance sheets are presented below
Radman Corporation Balance Sheet
2018 2017
Cash 5,300.00 3,700.00
Accounts receivable 21,200.00 23,400.00
Inventory 9,000.00 7,000.00
Land 20,000.00 26,000.00
Buildings 70,000.00 70,000.00
Accumulated depreciation- Buildings 15,000.00 10,000.00
Total 110,500.00 120,100.00
Accounts payable 10,370.00 31,100.00
Common stock 75,000.00 69,000.00
Retained earnings 25,130.00 20,000.00
Total 110,500.00 120,100.00
The 2018 income statement included net sales of $120 000.00, cost of goods sold of $70 000.00 and net income of $14 000.00
Establish the following ratios for 2018:
i) Current ratio
iii) Acid- Test ratio
iv) Accounts receivables Turnover
v) Inventory turnover
vi) Profit margin
vii) Return on stockholders' equity
b) With each of the above ratios, advise the management on the possible business decisions.
5) Frederick company has the following data for the year ended May 2016
Factory utilities 15600
Depreciation on factory equipment 12650
Depreciation on delivery trucks 8800
indirect factory labor 48900
Indirect material 80800
Direct material used 137600
Factory manager's salary 13000
Direct labor 89100
Sales salary 46400
Property tax on buildings 2500
Repairs to office equipment 2300
factory repairs 2000
advertising 18000
office supplies 5640
Calculate the following:
a) Manufacturing overhead
b) Product costs
c) Period costs
Expert Answer:
