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During year 1, Perez Manufacturing Company incurred $123,200,000 of research and development (R&D) costs to create a long-life battery to use in computers. In accordance
During year 1, Perez Manufacturing Company incurred $123,200,000 of research and development (R&D) costs to create a long-life battery to use in computers. In accordance with FASB standards, the entire R&D cost was recognized as an expense in year 1. Manufacturing costs (direct materials, direct labor, and overhead) are expected to be $58 per unit. Packaging, shipping, and sales commissions are expected to be $11 per unit. Perez expects to sell 2,800,000 batteries before new research renders the battery design technologically obsolete. During year 1, Perez made 434,000 batteries and sold 390,000 of them. Required aIdentify the upstream and downstream costs. bDetermine the year 1 amount of cost of goods sold and the ending inventory balance that would appear on the financial statements that are prepared in accordance with GAAP. cDetermine the sales price assuming that Perez desires to earn a profit margin that is equal to 20 percent of the total cost of developing, making, and distributing the batteries. dPrepare a GAAP-based income statement for year 1. Use the sales price developed in Requirement c. During year 1, Perez Manufacturing Company incurred $123,200,000 of research and development (R&D) costs to create a long life battery to use in computers. In accordance with FASB standards, the entire R&D cost was recognized as an expense in year 1. Manufacturing costs (direct materials, direct labor, and overhead) are expected to be $58 per unit. Packaging, shipping, and sales commissions are expected to be $11 per unit. Perez expects to sell 2,800,000 batteries before new research renders the battery design technologically obsolete. During year 1. Perez made 434.000 batteries and sold 390,000 of them. Required a. Identify the upstream and downstream costs. b. Determine the year 1 amount of cost of goods sold and the ending inventory balance that would appear on the financial statements that are prepared in accordance with GAAP c. Determine the sales price assuming that Perez desires to earn a profit margin that is equal to 20 percent of the total cost of developing, making, and distributing the batteries. d. Prepare a GAAP based income statement for year 1. Use the sales price developed in Requirement c. Complete this question by entering your answers in the tabs below. Required B Required A Required Required Identify the upstream and downstream costs 1. Research and development 2. Packaging 3. Shipping 4. Sales commissions Prev 1 of 3 !! Next > $ BRB . $ 4 % 5 & 7 8 3 o Y C T E R H. K G F S D pense in year expected to be $58 per unit. Packaging, shipping, and to be $11 per unit. Perez expects to sell 2,800,000 batteries before new research renders the ba design technologically obsolete. During year 1, Perez made 434,000 batteries and sold 390,000 of them. Required a. Identify the upstream and downstream costs, b. Determine the year 1 amount of cost of goods sold and the ending inventory balance that would appear on the financial s that are prepared in accordance with GAAP. c. Determine the sales price assuming that Perez desires to earn a profit margin that is equal to 20 percent of the total cost developing, making, and distributing the batteries. d. Prepare a GAAP-based income statement for year 1. Use the sales price developed in Requirement c. Complete this question by entering your answers in the tabs below. Required A Required B Regulad Required D Determine the sales price assuming that Perez desires to earn a profit margin that is equal to 20 percent of the total cost of developing, making, and distributing the batteries. (Do not round intermediate calculations. Round your final answer to 2 decimal places.) Sales price b. Determine the year 1 amount of cost of goods sold and the ending inventory that are prepared in accordance with GAAP. c. Determine the sales price assuming that Perez desires to earn a profit margin that is equal to 20 percent developing, making, and distributing the batteries. d. Prepare a GAAP-based income statement for year 1. Use the sales price developed in Requirement c. Complete this question by entering your answers in the tabs below. Required A Required B Required Required D Prepare a GAAP-based income statement for year 1. Use the sales price developed in Requirement C. (Do notre intermediate calculations.) PEREZ MANUFACTURING COMPANY Income Statement Net income (loss)
During year 1, Perez Manufacturing Company incurred $123,200,000 of research and development (R&D) costs to create a long-life battery to use in computers. In accordance with FASB standards, the entire R&D cost was recognized as an expense in year 1. Manufacturing costs (direct materials, direct labor, and overhead) are expected to be $58 per unit. Packaging, shipping, and sales commissions are expected to be $11 per unit. Perez expects to sell 2,800,000 batteries before new research renders the battery design technologically obsolete. During year 1, Perez made 434,000 batteries and sold 390,000 of them.
Required
aIdentify the upstream and downstream costs.
bDetermine the year 1 amount of cost of goods sold and the ending inventory balance that would appear on the financial statements that are prepared in accordance with GAAP.
cDetermine the sales price assuming that Perez desires to earn a profit margin that is equal to 20 percent of the total cost of developing, making, and distributing the batteries.
dPrepare a GAAP-based income statement for year 1. Use the sales price developed in Requirement c.
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