Question
25. On its December 31, 2017, balance sheet, Calgary Industries reports equipment of $410,000 and accumulated depreciation of $82,000. During 2018, the company plans to
25.
On its December 31, 2017, balance sheet, Calgary Industries reports equipment of $410,000 and accumulated depreciation of $82,000. During 2018, the company plans to purchase additional equipment costing $88,000 and expects depreciation expense of $34,000. Additionally, it plans to dispose of equipment that originally cost $46,000 and had accumulated depreciation of $6,400. The balances for equipment and accumulated depreciation, respectively, on the December 31, 2018 budgeted balance sheet are:
24
Flagstaff Company has budgeted production units of 9,800 for July and 10,000 for August. The direct materials requirement per unit is 3 ounces (oz.). The company has determined that it wants to have safety stock of direct materials on hand at the end of each month to complete 25% of the units budgeted in the following month. There was 7,350 ounces of direct material in inventory at the start of July. The total amount of direct materials in ounces, to be purchased in July is:
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