I only need the answers for the empty yellow spaces. all the filled in yellow spaces are correct and all the required information should be completely provided. this is due at 11:59 tonight and i just need help with the remaining unanswered questions.

this is the least blurry i can make it. hopefully this is good enough

Background intormation I SEE. THE LIGHT (ISTL) is a subchapter 5 comoration that inanulactures chidren's lampsinightights tor use in bedrooms. These tamps are sola nabonwide through a group of independent sales replesentatives who have an exdusive sales region the bukness is in its tenth yeat and has asiked you to assist in planning for next year's operdions The lamps are ceramic figurnes of animals, boats, boys and gins playing and singing, all in delohthil colors The owner of the business, Big Al, creates a drawing for the foguane and tawes in to a plant in Chira where a mold is created and a sample produced and hand painted. if the mold mees the expectaboas of BigA an order of 500 anmp partg is placed Fach lantg hut consists of the oats requed so complele one lamg, a tourine, a lamp shade and the required electrical coenpooents. There are presently 10 diflerent figunaes that corre in 5x difterent colors, 60 modets: There are presently 10 woners in the plant. They are responsibic for recetwng the taw naterial, manutacturing the product, packing and shipping in addition to Big A there are two office workers who are responsioic tor ag adminatrative duties. Bg A had tis accountant prepase the Projected income Statement and Baance sheet presented on poge two Big Al neard aboot your skils in manageral acoounting and would like your assistance in the following areas To uphad rour woin to Big A Ele fle wiriout changng the naine. Pay attention to the spects: localion that Excel saves the fie Refuen to the botiom of the page that you downloaded the file Projected Balance Sheet As of December 31, 20x1 Gurrent Assots Cash Accounts Recoratio Inventory Raw Matorial Latmp Kits Work in Process Finishod Goods Total Current Assets Fired Assets Equpmert Accumulated Dopteciabon Totad fmod Assets Total Assets $34.710.00 67,500.00 Current Liabilites Accounts Payablo Total Liabilities Stockholder's Equity Common Stock Retaked Earnings Total Stociholder's Equity Total Liabilities and Stockholdir's Equity $5,0000054,00000 $12.00000 147,41000 $213.41000159.41000 I See The Light Projected Income Statement For the Period Ending December 31,201 Sales Cost of Goods Sold Gross Profit Selling Expenses Fixed Variable 25,000 lamps (a) $45.00 (a) $30.00 Administrative Expenses: Fixed Variable Total Selling and Administrative Expenses. Net Profit $1,125,000.00 750,000.00 $375,000.00 $42,000.00 ( $2.0050,000.00 92,000:00 190,000.00$185,000.00 PART 1 Fixed and Variable Cost Determinations Unit Cost Calculations The projected cost of a lamp is colculated based upon the projected increases or decreases to current costs, The present costs to manutacture one lamp are: Expectod increases for 20x2 When calculating prolected increases round to TWO ($0,00) decimial places: 1. Material Costs are expected to Hereaso by 450% 2 Labor Costs are exgected to increase by 500% 3. Variable Overhead is expectod to increase by 4.50 is 3. Variable Overhead is expected to increase by 4.50% 4. Fixed Overhead is expected to increase to $270,000. 5. Fixed Administrative expenses are expected to increase to $62,000. 6. Variabl enses (measured on a per lamp basis) are expected to increase by 4.00% 7. Fixed selling expenses are expected to be $27,000 in 202. 8. Variable administrative expenses (measured a per lamp basis) are expected to increase by 5.00% On the following schedule develop the following figures: 1- 20x2 Projected Variable Manufacturing Unit Cost of a lamp. 2. 20x2 Projected Variable Unit Cost per lamp 3- 20x2 Projected Fixed Costs. 411 Laboip Kart Projected D Piscerd "20x Cost Founded 102 increase Decimal Places (401\}) (4.02) 1403) (404) Wariatin silting Variable Adrenciatratno Progected Vamable Manufacturing Unet Cost Propected Total Varabe Cout Per une {405} (406) (4 C4) Total Vanable Cast Per Unit Schedule of Fired Costs Projected Total Vanable Cost Per Unit Projected Variable Manufacturing Unit Cost Projected Total Vanable Cost Per Unit Cost Volume Relationships Profit Planning Big Al is about to begin work on the budget for 20x2 and they have requested that you prepare an analysis besed on the folowing assumptions. Nole Remember, that we cannot sel part of a lamp, therofore to find the number of unts you have to round up to the next complote unit. Furthuremore, to find the requred sales in dollars it may be easier to find the number of units and thion multiply by the selling price per unit For 20x2 the seling price per lamp will be $4500. What is the prosected contribution margin and contribution marain ratin for naeh luene snly? Contribution Margin Ratio (Round to four places, H\% is two of those places uth um\%) For 20x2 the selling price per larep wot be $45,00. The desired net incone in 20x2 is $187.500. What For 2002 the selling price per lamp ail be $45,00. If the fxed cost increase by $55,000.00 how many lamps Ereakeven sales in unis (Since we cassod sell pat obg ind round up to the next unit if needed) Cost Volume Relationships Profit Planning Gig Nis about to begin work on the budgetfol 20 and and they hav requestod that rou prepare an analya is based on the following assumptiens Nowe Flemember, that we cannot sell part of a lamp, therefore to tind the number of units you hame to round up ta the next comphete anit Furthuremore, to find the requited saies in dollars if miay be easiec to find the number of units and then mulsthy by the selling brice per unit For 2012 the seling price ner litho will be \$45.09. What is the projected contribetion margin and contribution marnin ratin Sat sarh lamn eald? Controubon Margen Ravo (Round to four plocest, in two of thote piaces en nawb) For zore the zeding snce per larrip wai be $4600. Toe desred not income in 2002 is 5167,500 . What 3. For 20x2 the selling price per lamp will be $45.00. If the fixed cost increase by $55,000.00 how many lamps Breakeven sales in units (Since we cannot sell part of a unit round up to the next unit if needed For 26oc the belling price per lamp well be 545,00 . t the varable cost increase ty 55.50 in unit how many lamps mart be sold so breakewn? iruit to sodd io treakeren? If for 202 the selling price per lamp is increased to $50.50 a unt how many lamps must be sold If for 202 the selling price per lamp is decreased to $39.50 a unit how many lamps must be sold Division N has decided to develop its budget based upon projected sales of 43,000 lamps at $50.00 periamp The company has requested that you prepare a master budget for the year. This budget is to be used for planning and control of operations and should be composed of: 1. Production Budget 2. Matenals Budget 3. Direct Labor Budget 4 Factory Overhead Budget 5 Selling and Administrative Budget 6 Cost of Goods Sold Budgel 7. Budgeted income Statement 8: Cash Budget Notes for Budgeting The compary wants to maintain the same number of units in the beginning and ending inventories of workin-process, and electrical parts while increasing the inventory of Lamp Kits to 575 pieces and decreasing the finished goods by 20% Complete the followng budgets 1 Production fudeet Planned Sales Desired Ending inventory of Finished Goods Total Needed Less. Beginning inventory Total Production 2 Materials Eudoet. 1111 Lampions 12 Needed for Production 1313 Desered Ending irvertiory 1414 Total Needed 15 Less Beginning imentory 21 Total Purchases 22 Coit per picce Cost of Purchases (Round to two places, Sut und ) \begin{tabular}{|r|r|} \hline & 42400 onits \\ \hline 575 unds \\ \hline & 42975 units \\ \hline 500 unt \\ \hline & 42475 \\ \hline & 16.72 \\ \hline & 310.18200 \\ \hline \end{tabular} (802) (0,03) (004) (6.95) (80 06) 7473 Dwect Labor Budget 7574 Labor Cost Per Lamp Production Total Labor Cost (Round to two places, Sum nn) 9392 Varabie Factory Overhead: Variable Factory Ovemead Cost Per Und Number of Units to be Produced Total Variable Factory Overhead (Round to two places, Suw unit) Foced Factory Overtead (8,07) (898) Totalf actory Overhead' (Round to two ploces, sen and) 533 + Eactocy Overinad Bodiot 136 Overtead Alocation rate based on 14131. Number of Uaits Totak Factory Onerhead N Number of Units (Round to (wo places, \$win ait) \begin{tabular}{|l|r|r|} \hline & & \\ \hline & & \\ \hline & & 38.46 \\ \hline \end{tabular} 1901) 2417 s. Cote of making ono unt novt woor. Cost at one Lamp Kit Lhbor Cost Por Limmp Factory owertwod per unt Totat cost of one unat (Flound to two places, stin ini4) \begin{tabular}{|r|r|r|} \hline & & 16.72 \\ \hline & & $210 \\ \hline & & 846 \\ \hline & & \\ \hline & & $2728 \\ \hline \end{tabular} 19021 2827 3635 4937 5049 by siolling and Acdment Bicoad? Finod Seting Viamable Seling (Rocund to hoo pacicos, Syaw airi) Fowod Admenisaratio (0,04) xemion Ronund doltars to two Mssume actual cash receipts and disbursements will follow the patiom below: (Note: Receivables and Payables of 12/31/x1 wil have a casti impact in 202 ) 16.00\% of sales for the year are made in November and December Since our customers havo 60 day terms those funds wil be collected be colected in January and February B50096 of material purchases wil be paid during the year, the remaining portion will be paid in Januay or Fobruary 3. All other manutacturing and operating costs aro paid for whon incurred. 4. The budgeled depreciation expense is equal to 0.6% of the fored manufacturing. selling and administrative expenses. . Minimum Cesh Balance needed for 20x2, $175,000 I See The Light Projected Cash Budget Rinume cioklars to two Cost of (1301) Cost c (13.02} Cost of: {13.03} Cost of : (13.04) Standard Job Order Costing Variance Analysis Special order lamps are manutactured in division S. Because of the precise nature of the process a standard cost systom has been devekoped. The following standards are used for the special orders: ". Faod oworbead is based on expected production of 4,010 customized lamps each month. To keep rocords of the actual cost of a job, a.job Ordor Cost System has been developed. Entries are made to the alob Order System at actual cost (overhoad is applod based on actaal lakor hours) 2 while entries are made to the accounhing system at standard, Variance analysis is tised to analyze the ditferences. Iob Ordor Costing Section On Januaty 1, 20\%2, Disision S bogan wob 1101 for tho Clont, THE BIG CHILDREN STORE The job called for 4.000 customized larmps The following sot of transactions occurred from January 5 unti the job was completed 5. Jan Purchased 4,050 Lamp Kits (a) $16.60 per kit 9.Jan 4,050 sets of Lamp Kits were reguisitioned. 17- lan Payroll of 610 Diroct Labor Hours (a) $9 to5 per hour 30 Jan Payroll of 660 Direct Labor Hours (9) $990 per hour 30-Jan 3,990 lamps were completed and shipped All materiats requisitioned were used of scrappod 98 Note: Show favorable variances as negative numbers 1817 2219 What why the material asoge variance for Lamp Kats? 36363332 What was the direct iabor rate variance? 3938 \begin{tabular}{|l|l|} \hline & \\ \hline & \\ \hline & Round doliars to \\ \hline two places, Gith tid \\ \hline & \\ \hline & \\ \hline & \\ \hline & \\ \hline & \\ \hline & \\ \hline & \\ \hline & \\ \hline & \\ \hline & \\ \hline & \\ \hline & \\ \hline \end{tabular} (1501) (1502) (15:09) {1504} Note: Show tavorable variances as negotive numbers What was the varabin gethead efficiency variance? What was the varable OHI spending varance? Big Al gives his woeker's a one hour lunch and two fifteen minute breaks each day. He believes that a fold soda machine would bo appreciated by his workers, and an appreciated worker is a good worker. He has priced a machine at a national member only warehouse for $1,950, The machine should be usable for 3 years, atter which it would be inefficient, obsolete and would have to be disposed of at the dump. Big A believes thiat to cans a day will be purchased. The plant is open five days a week, 50 Lweeks peryear. A case of soda (24 cans) costs $6,00 and Big Al beliewes that a price of $.90 per foan would win him good will What is the e What is the contribution marain per can of soda? (rounded to two places. Se. HeH) What is the B If the time valup of manta os 120 ner waar what is the net onasant value? Use the tablet on bade 18. I SEE THE LIGHT (ISTL) is a subchapter S corporation that manufactures children's lampsightlights for use in bedrooms. These lamps are sold nationwide through a group of independent sales representatives who have an exclusive sales region. The business is in its tenth year and has asked you to assist in planning for next year's operations. The lamps are ceramic figurines of animals, boats, boys and girls playing and singing, all in delightful colors. The owner of the business, Big Al, creates a drawing for the figurine and faxes it to a plant in China where a mold is created and a sample produced and hand painted. If the mold meets the expectations of Big Al an order of 500 lamp parts is placed. Each lamp kit consists of the parts required to complete one lamp; a figurine, a lamp shade and the required electrical components. There are presently 10 different figurines that come in six different colors; 60 models. There are presently 10 workers in the plant. They are responsible for receiving the raw material, manufacturing the product, packing and shipping. In addition to Big Al there are two office workers who are responsible for all administrative duties. Big Al had his accountant prepare the Projected Income Statement and Balance Sheet presented on page two. Big Al heard about your skills in managerial accounting and would like your assistance in the following areas: Part1Part2Part3Part4Part5Part6Part7FixedandVariableCostDeterminations-UnitCostCalculationsCostVolumeRelationships-ProfitPlanningBudgetsProcessCostingJobOrderCostingStandardCosting-VarianceAnalysisCapitalDecisionMaking I See The Light Projected Income Statement For the Period Ending December 31, 20x1 PART 1 Fixed and Variable Cost Determinations Unit Cost Calculations The projected cost of a lamp is calculated based upon the projected increases or decreases to current costs. The present costs to manufacture one lamp are: Expected increases for 202 When calculating projected increases round to TWO ($0.00) decimal places. 1. Material Costs are expected to increase by 4.50%. 2. Labor Costs are expected to increase by 5.00%. 3. Variable Overhead is expected to increase by 4.50%. 4. Fixed Overhead is expected to increase to $270,000. 5. Fixed Administrative expenses are expected to increase to $62,000. 6. Variable selling expenses (measured on a per lamp basis) are expected to increase by 4.00%. 7. Fixed selling expenses are expected to be $27,000 in 202. 8. Variable administrative expenses (measured a per lamp basis) are expected to increase by 5.00%. On the following schedule develop the following figures: I See The Light, Inc Schedule of Projected Costs Variable Manufacturing Unit Cost Lamp Kit Labor Variable Overhead Projected Variable Manufacturing Cost Per Unit Total Variable Cost Per Unit Variable Selling Variable Administrative Projected Variable Manufacturing Unit Cost Projected Total Variable Cost Per Unit Schedule of Fixed Costs Fixed Overhead (normal capacity of Fixed Selling Fixed Administrative Projected Total Fixed Costs {4.01} [4.02} \{4.03\} {4.04} {4.05} {4.06} {4.04} 14.04 (4.07) (4.08) [4.09} {4.10} (4.11) Big Al is about to begin work on the budget for 202 and they have requested that you prepare an analysis based on the following assumptions Note: Remember, that we cannot sell part of a lamp, therefore to find the number of units you have to round up to the next complete unit. Furthuremore, to find the required sales in dollars it may be easier to find the number of units and then multiply by the selling price per unit. 1. For 20x2 the selling price per lamp will be $45.00. What is the projected contribution margin and contribution mamin ratio for earh lamn snld? Contribution Margin Ratio (Round to four places, % is two of those places rk intw) For 20x2 the selling price per lamp will be $45,00. The desired net income in 20x2 is $187,500, What For 20x2 the selling price per lamp will be $45.00. If the foced cost increase by $55,000.00 how many lamps miiet ha enid kn kroaluaian? Breakeven sales in units (Since we cannot sell pact of a unit round up to the next unit if needed) 4. For 202 the selling price per lamp will be $45.00. If the variable cost increase by $5.50 a unit how many lamps must be sold to breakeven? Breakeven sales in units (Since we cannot sell part of a unit round up to the next unit it needed) 5. For 202 the selling price per lamp will be $45.00. If the variable cost decreased by $5.50 a unit how many lamps must be sold to breakeven? 6. If for 20x2 the selling price per lamp is increased to $50.50 a unit how many lamps must be sold in hrakauan? 7. If for 20x2 the selling price per lamp is decreased to $39.50 a unit how many lamps must be scid th hravavan? 5965 PART 3 Budgets Division N has decided to develop its budget based upon projected sales of 43,000 lamps at $50.00 per lamp. The company has requested that you prepare a master budget for the year. This budget is to be used for planning and control of operations and should be composed of: 1. Production Budget 2. Materials Budget 3. Direct Labor Budget 4. Factory Overhead Budget 5. Seling and Administrative Budget 6. Cost of Goods Sold Buoget 7. Budgeted income Statement 8. Cash Budget Notes for Budgeting: The company wants to maintain the same number of units in the beginning and ending inventories of work-in-process, and electrical parts while increasing the inventory of Lamp Kits to 575 pieces and decreasing the finished goods by 20%. Complete the following budgets 1 Production Bunget Planned Sales Desired Ending Inventory of Finished Goods Total Needed Less: Beginning liventory Total Production \begin{tabular}{|r|} \hline(300020%)=2400 \\ \hline 45400 \\ \hline 3000 \\ \hline 42.400 units \\ \hline \end{tabular} [7.01] 6965 2 Materials Budget Lamp Kits Needed for Production Desired Ending Inventory Total Needed Less: Beginning Inventory Total Purchases Cost per piece Cost of Purchases (Round to two places, \$\#\#.\#\#\#) 3 Direct Labor Budget Labor Cost Per Lamp Production Total Labor Cost (Round to two places, \$\#\#.\#\#\#) 4 Eactory Overhead Budget Variable Factory Overhead: Variable Factory Overhead Cost Per Unit Number of Units to be Produced Total Variable Factory Overhead (Round to two places, \$i.n.H\#) Fixed Factory Overhead Total Factory Overhead (Round to two places, \$H\#.\#\#) [8.01] 18.021 {8.03} \{8.04\} 18.05\} (8.06) 18.07| \{8.08\} (8.09) (8.10) \{8.11\} Page 9 Ivan West 6965 4 Eactor Overhead Budoet Overhead Allocation rate based on: 1. Number of Units Total Factory Overhead / Number of Units (Round to two places, \$4.\#.MH) \begin{tabular}{|l|l|l|} \hline & & \\ \hline & & \\ \hline & & $8.46 \\ \hline \end{tabular} (9.01) 5 Cost of making one unit next year Cost of one Lamp Kit Labor Cost Per Lamp Factory overhead per unit Total cost of one unit (Round to two places, \$\#\#\#..\#H) \begin{tabular}{|l|r|r|} \hline & & 16.72 \\ \hline & & $2.10 \\ \hline & & 8.46 \\ \hline & & $27.28 \\ \hline \end{tabular} (9.02) (9.03) 6 Selling and Admin. Budget Fixed Selling Variable Selling (Round to two places, \$\#\#..\#\#) Fixed Administrative Variable Administrative (Round to two places, \$H\#\#.nH) Total Selling and Administrative (Round to two places, \$m..m) 7 Goods Sold Budget . Beginning Inventory, Finished Goods Production Costs: Materials: Lamp Kits: Beginning Inventory Purchased Available for Use Ending Inventory of Lamp Kits Lamp Kits Used In Production Total Materials: Labor Overhead Cost of Goods Available Less: Ending Inventory, Finished Goods Cost of Goods Sold {9.04} (9.05) (9.06) Round dollars to two places, \$H\#...H\# {9.07} 19.08 19.09\} (9.10) (9.11) {9.12} (9.13) 19.14) 8 Cash Budget Assume actual cash receipts and disbursements will follow the pattem below: (Note: Recelvables and Payables of 12/31 tx1 will have a cash impact in 202.) 1. 16.00% of sales for the year are made in November and December. Since our customers have 60 day terms those funds will be collected be collected in January and February. 2. 85.00% of material purchases will be paid during the year, the remaining portion will be paid in Januay or February. 3. All other manufacturing and operating costs are paid for when incurred. 4. The budgeted depreciation expense is equal to 0.6% of the fixed manufacturing, seling and administrative expenses. 5. Minimum Cash Balance needed for 202,$175,000. I See The Light Projected Cash Budget For the Year Ending December 31, 20x2 Rinuind rinillars in twn To keep records of the actual cost of a special order job, a Job Order Cost System has been developed. Overhead is applied at the rate of 50% of the direct labor cost. Job Order Costing Section On January 1, 20x2, Division S began Job 2407 for the Clent. THE BIG CHILDREN STORE. The job called for 4,000 customized lamps. The following set of transactions occurred from January 5 untl the job was completed: 5.Jan Purchased 4,050 Lamp Kits \& $16.60 per kit. 9-Jan 4,050 sets of Lamp Kits were requisitioned. 17. Jan Payrol of 610 Direct Labor Hours (i) $9.65 per hour. 30-Jan Payroll of 660 Direct Labor Hours @ $9.90 per hour. 30-Jan 3,990 lamps were completed and shipped. All materials requisitioned were used or scrapped, and are a cost of normal processing. Round Cost of Direct Material Incurred in Manufacturina Job 2407 Cost of Manifarturinn Ouarheact Annlied th .lah 2407 To keep records of the actual cost of a special order job, a Job Order Cost System has been developed. Overhead is applied at the rale of 50% of the direct labor cost. Job Order Costing Section On January 1, 20x2, Division 5 began Job 2407 for the Clent, THE BIG CHILDREN STORE. The job called for 4,000 customized lamps. The following set of transactions occurred from January 5 unti the job was comploted: 5. Jan Purchased 4,050 Lamp Kits in $16.60 per kit. 9-Jan 4,050 sets of Lamp Kits were requisitioned 17-Jan Payrol of 610 Direct Labor Hours (88 $9.65 per hour. 30-Jan Payroll of 660 Direct Labor Hours \& $9.90 per hour. 30-Jan 3,990 lamps were completed and shipped. All materials requisitioned were used or scrapped, and are a cost of normal processing. Round to two places. \$wis t Cost of Piract Matarial lamimad in Manidactivime wh Zant [13.01} Cost of Manudarthirion Nuarhead Annilied th . Inh 207 13.021 [13.03] Cost of mandednatuaiain nama lomon Speciai order lamps are manufactured in division S. Because of the precise nature of the process a standard cost system has been developed. The following standards are used for the special orders: * Fixed overhead is based on expected production of 4,010 customized lamps each month. To keep records of the actual cost of a job, a Job Order Cost System has been developed. Entries are made to the Job Order System at actual cost (overhead is applied based on actual labor hours) While entries are made to the accounting system at standard. Variance analysis is used to analyze the differences. Job Order Costing Section On January 1, 20x2, Division S began Job 1101 for the Client. THE BIG CHILDREN STORE. The job called for 4,000 customized lamps. The following set of transactions occurred from January 5 until the job was completed: 5-Jan Purchased 4,050 Lamp Kits @. \$16.60 per kit. 9-Jan 4,050 sets of Lamp Kits were roquisitioned. 17-Jan Payroll of 610 Direct Labor Hours (A) $9.65 per hour. 30-Jan Payroll of 660 Direct Labor Hours i\& $9.90 per hour. 30-Jan 3,990 lamps were completed and shipped. All materials requisitioned were used or scrappod. How many Lamps were completed? Note: Show favorable variances as negative numbers What was the total material price variance for the Lamp Kits purchased? What was the material usage variance for Lamp Kits? What was the direct labor efficiency variance? What was the direct labor rate variance? Note: Show favorable variances as negative numbers What was the variable overhead efficiency variance? What was the variable OH spending variance ? What is the fixed OH volume (denominator) variance? What is the fixed OH spending variance? Big Al gives his worker's a one hour lunch and two fifleen minute breaks each day. He believes that a cold soda machine would be appreciated by his workers, and an appreciated worker is a good worker. He has priced a machine at a national member only warehouse for $1,950. The machine should be usable for 3 years, after which it would be inefficient, obsolete and would have to be disposed of at the dump. Big Al believes that 10 cans a day will be purchased. The plant is open five days a week, 50 weeks per year. A case of soda (24 cans) costs $6.00 and Big A believes that a price of $.90 per can would win him good will. What is the es. (17.01) What is the contribution marain ser can of soda? (rounded to two blaces. St diti) [17.02] How many cans of soda must be sold each year to breakeven? (Round up to zero places. Wini, ,adw cans) (17.04) What is the pauhark nariod in vases? Irnanded th tun nlaces tt an warel {17.05} Background intormation I SEE. THE LIGHT (ISTL) is a subchapter 5 comoration that inanulactures chidren's lampsinightights tor use in bedrooms. These tamps are sola nabonwide through a group of independent sales replesentatives who have an exdusive sales region the bukness is in its tenth yeat and has asiked you to assist in planning for next year's operdions The lamps are ceramic figurnes of animals, boats, boys and gins playing and singing, all in delohthil colors The owner of the business, Big Al, creates a drawing for the foguane and tawes in to a plant in Chira where a mold is created and a sample produced and hand painted. if the mold mees the expectaboas of BigA an order of 500 anmp partg is placed Fach lantg hut consists of the oats requed so complele one lamg, a tourine, a lamp shade and the required electrical coenpooents. There are presently 10 diflerent figunaes that corre in 5x difterent colors, 60 modets: There are presently 10 woners in the plant. They are responsibic for recetwng the taw naterial, manutacturing the product, packing and shipping in addition to Big A there are two office workers who are responsioic tor ag adminatrative duties. Bg A had tis accountant prepase the Projected income Statement and Baance sheet presented on poge two Big Al neard aboot your skils in manageral acoounting and would like your assistance in the following areas To uphad rour woin to Big A Ele fle wiriout changng the naine. Pay attention to the spects: localion that Excel saves the fie Refuen to the botiom of the page that you downloaded the file Projected Balance Sheet As of December 31, 20x1 Gurrent Assots Cash Accounts Recoratio Inventory Raw Matorial Latmp Kits Work in Process Finishod Goods Total Current Assets Fired Assets Equpmert Accumulated Dopteciabon Totad fmod Assets Total Assets $34.710.00 67,500.00 Current Liabilites Accounts Payablo Total Liabilities Stockholder's Equity Common Stock Retaked Earnings Total Stociholder's Equity Total Liabilities and Stockholdir's Equity $5,0000054,00000 $12.00000 147,41000 $213.41000159.41000 I See The Light Projected Income Statement For the Period Ending December 31,201 Sales Cost of Goods Sold Gross Profit Selling Expenses Fixed Variable 25,000 lamps (a) $45.00 (a) $30.00 Administrative Expenses: Fixed Variable Total Selling and Administrative Expenses. Net Profit $1,125,000.00 750,000.00 $375,000.00 $42,000.00 ( $2.0050,000.00 92,000:00 190,000.00$185,000.00 PART 1 Fixed and Variable Cost Determinations Unit Cost Calculations The projected cost of a lamp is colculated based upon the projected increases or decreases to current costs, The present costs to manutacture one lamp are: Expectod increases for 20x2 When calculating prolected increases round to TWO ($0,00) decimial places: 1. Material Costs are expected to Hereaso by 450% 2 Labor Costs are exgected to increase by 500% 3. Variable Overhead is expectod to increase by 4.50 is 3. Variable Overhead is expected to increase by 4.50% 4. Fixed Overhead is expected to increase to $270,000. 5. Fixed Administrative expenses are expected to increase to $62,000. 6. Variabl enses (measured on a per lamp basis) are expected to increase by 4.00% 7. Fixed selling expenses are expected to be $27,000 in 202. 8. Variable administrative expenses (measured a per lamp basis) are expected to increase by 5.00% On the following schedule develop the following figures: 1- 20x2 Projected Variable Manufacturing Unit Cost of a lamp. 2. 20x2 Projected Variable Unit Cost per lamp 3- 20x2 Projected Fixed Costs. 411 Laboip Kart Projected D Piscerd "20x Cost Founded 102 increase Decimal Places (401\}) (4.02) 1403) (404) Wariatin silting Variable Adrenciatratno Progected Vamable Manufacturing Unet Cost Propected Total Varabe Cout Per une {405} (406) (4 C4) Total Vanable Cast Per Unit Schedule of Fired Costs Projected Total Vanable Cost Per Unit Projected Variable Manufacturing Unit Cost Projected Total Vanable Cost Per Unit Cost Volume Relationships Profit Planning Big Al is about to begin work on the budget for 20x2 and they have requested that you prepare an analysis besed on the folowing assumptions. Nole Remember, that we cannot sel part of a lamp, therofore to find the number of unts you have to round up to the next complote unit. Furthuremore, to find the requred sales in dollars it may be easier to find the number of units and thion multiply by the selling price per unit For 20x2 the seling price per lamp will be $4500. What is the prosected contribution margin and contribution marain ratin for naeh luene snly? Contribution Margin Ratio (Round to four places, H\% is two of those places uth um\%) For 20x2 the selling price per larep wot be $45,00. The desired net incone in 20x2 is $187.500. What For 2002 the selling price per lamp ail be $45,00. If the fxed cost increase by $55,000.00 how many lamps Ereakeven sales in unis (Since we cassod sell pat obg ind round up to the next unit if needed) Cost Volume Relationships Profit Planning Gig Nis about to begin work on the budgetfol 20 and and they hav requestod that rou prepare an analya is based on the following assumptiens Nowe Flemember, that we cannot sell part of a lamp, therefore to tind the number of units you hame to round up ta the next comphete anit Furthuremore, to find the requited saies in dollars if miay be easiec to find the number of units and then mulsthy by the selling brice per unit For 2012 the seling price ner litho will be \$45.09. What is the projected contribetion margin and contribution marnin ratin Sat sarh lamn eald? Controubon Margen Ravo (Round to four plocest, in two of thote piaces en nawb) For zore the zeding snce per larrip wai be $4600. Toe desred not income in 2002 is 5167,500 . What 3. For 20x2 the selling price per lamp will be $45.00. If the fixed cost increase by $55,000.00 how many lamps Breakeven sales in units (Since we cannot sell part of a unit round up to the next unit if needed For 26oc the belling price per lamp well be 545,00 . t the varable cost increase ty 55.50 in unit how many lamps mart be sold so breakewn? iruit to sodd io treakeren? If for 202 the selling price per lamp is increased to $50.50 a unt how many lamps must be sold If for 202 the selling price per lamp is decreased to $39.50 a unit how many lamps must be sold Division N has decided to develop its budget based upon projected sales of 43,000 lamps at $50.00 periamp The company has requested that you prepare a master budget for the year. This budget is to be used for planning and control of operations and should be composed of: 1. Production Budget 2. Matenals Budget 3. Direct Labor Budget 4 Factory Overhead Budget 5 Selling and Administrative Budget 6 Cost of Goods Sold Budgel 7. Budgeted income Statement 8: Cash Budget Notes for Budgeting The compary wants to maintain the same number of units in the beginning and ending inventories of workin-process, and electrical parts while increasing the inventory of Lamp Kits to 575 pieces and decreasing the finished goods by 20% Complete the followng budgets 1 Production fudeet Planned Sales Desired Ending inventory of Finished Goods Total Needed Less. Beginning inventory Total Production 2 Materials Eudoet. 1111 Lampions 12 Needed for Production 1313 Desered Ending irvertiory 1414 Total Needed 15 Less Beginning imentory 21 Total Purchases 22 Coit per picce Cost of Purchases (Round to two places, Sut und ) \begin{tabular}{|r|r|} \hline & 42400 onits \\ \hline 575 unds \\ \hline & 42975 units \\ \hline 500 unt \\ \hline & 42475 \\ \hline & 16.72 \\ \hline & 310.18200 \\ \hline \end{tabular} (802) (0,03) (004) (6.95) (80 06) 7473 Dwect Labor Budget 7574 Labor Cost Per Lamp Production Total Labor Cost (Round to two places, Sum nn) 9392 Varabie Factory Overhead: Variable Factory Ovemead Cost Per Und Number of Units to be Produced Total Variable Factory Overhead (Round to two places, Suw unit) Foced Factory Overtead (8,07) (898) Totalf actory Overhead' (Round to two ploces, sen and) 533 + Eactocy Overinad Bodiot 136 Overtead Alocation rate based on 14131. Number of Uaits Totak Factory Onerhead N Number of Units (Round to (wo places, \$win ait) \begin{tabular}{|l|r|r|} \hline & & \\ \hline & & \\ \hline & & 38.46 \\ \hline \end{tabular} 1901) 2417 s. Cote of making ono unt novt woor. Cost at one Lamp Kit Lhbor Cost Por Limmp Factory owertwod per unt Totat cost of one unat (Flound to two places, stin ini4) \begin{tabular}{|r|r|r|} \hline & & 16.72 \\ \hline & & $210 \\ \hline & & 846 \\ \hline & & \\ \hline & & $2728 \\ \hline \end{tabular} 19021 2827 3635 4937 5049 by siolling and Acdment Bicoad? Finod Seting Viamable Seling (Rocund to hoo pacicos, Syaw airi) Fowod Admenisaratio (0,04) xemion Ronund doltars to two Mssume actual cash receipts and disbursements will follow the patiom below: (Note: Receivables and Payables of 12/31/x1 wil have a casti impact in 202 ) 16.00\% of sales for the year are made in November and December Since our customers havo 60 day terms those funds wil be collected be colected in January and February B50096 of material purchases wil be paid during the year, the remaining portion will be paid in Januay or Fobruary 3. All other manutacturing and operating costs aro paid for whon incurred. 4. The budgeled depreciation expense is equal to 0.6% of the fored manufacturing. selling and administrative expenses. . Minimum Cesh Balance needed for 20x2, $175,000 I See The Light Projected Cash Budget Rinume cioklars to two Cost of (1301) Cost c (13.02} Cost of: {13.03} Cost of : (13.04) Standard Job Order Costing Variance Analysis Special order lamps are manutactured in division S. Because of the precise nature of the process a standard cost systom has been devekoped. The following standards are used for the special orders: ". Faod oworbead is based on expected production of 4,010 customized lamps each month. To keep rocords of the actual cost of a job, a.job Ordor Cost System has been developed. Entries are made to the alob Order System at actual cost (overhoad is applod based on actaal lakor hours) 2 while entries are made to the accounhing system at standard, Variance analysis is tised to analyze the ditferences. Iob Ordor Costing Section On Januaty 1, 20\%2, Disision S bogan wob 1101 for tho Clont, THE BIG CHILDREN STORE The job called for 4.000 customized larmps The following sot of transactions occurred from January 5 unti the job was completed 5. Jan Purchased 4,050 Lamp Kits (a) $16.60 per kit 9.Jan 4,050 sets of Lamp Kits were reguisitioned. 17- lan Payroll of 610 Diroct Labor Hours (a) $9 to5 per hour 30 Jan Payroll of 660 Direct Labor Hours (9) $990 per hour 30-Jan 3,990 lamps were completed and shipped All materiats requisitioned were used of scrappod 98 Note: Show favorable variances as negative numbers 1817 2219 What why the material asoge variance for Lamp Kats? 36363332 What was the direct iabor rate variance? 3938 \begin{tabular}{|l|l|} \hline & \\ \hline & \\ \hline & Round doliars to \\ \hline two places, Gith tid \\ \hline & \\ \hline & \\ \hline & \\ \hline & \\ \hline & \\ \hline & \\ \hline & \\ \hline & \\ \hline & \\ \hline & \\ \hline & \\ \hline & \\ \hline \end{tabular} (1501) (1502) (15:09) {1504} Note: Show tavorable variances as negotive numbers What was the varabin gethead efficiency variance? What was the varable OHI spending varance? Big Al gives his woeker's a one hour lunch and two fifteen minute breaks each day. He believes that a fold soda machine would bo appreciated by his workers, and an appreciated worker is a good worker. He has priced a machine at a national member only warehouse for $1,950, The machine should be usable for 3 years, atter which it would be inefficient, obsolete and would have to be disposed of at the dump. Big A believes thiat to cans a day will be purchased. The plant is open five days a week, 50 Lweeks peryear. A case of soda (24 cans) costs $6,00 and Big Al beliewes that a price of $.90 per foan would win him good will What is the e What is the contribution marain per can of soda? (rounded to two places. Se. HeH) What is the B If the time valup of manta os 120 ner waar what is the net onasant value? Use the tablet on bade 18. I SEE THE LIGHT (ISTL) is a subchapter S corporation that manufactures children's lampsightlights for use in bedrooms. These lamps are sold nationwide through a group of independent sales representatives who have an exclusive sales region. The business is in its tenth year and has asked you to assist in planning for next year's operations. The lamps are ceramic figurines of animals, boats, boys and girls playing and singing, all in delightful colors. The owner of the business, Big Al, creates a drawing for the figurine and faxes it to a plant in China where a mold is created and a sample produced and hand painted. If the mold meets the expectations of Big Al an order of 500 lamp parts is placed. Each lamp kit consists of the parts required to complete one lamp; a figurine, a lamp shade and the required electrical components. There are presently 10 different figurines that come in six different colors; 60 models. There are presently 10 workers in the plant. They are responsible for receiving the raw material, manufacturing the product, packing and shipping. In addition to Big Al there are two office workers who are responsible for all administrative duties. Big Al had his accountant prepare the Projected Income Statement and Balance Sheet presented on page two. Big Al heard about your skills in managerial accounting and would like your assistance in the following areas: Part1Part2Part3Part4Part5Part6Part7FixedandVariableCostDeterminations-UnitCostCalculationsCostVolumeRelationships-ProfitPlanningBudgetsProcessCostingJobOrderCostingStandardCosting-VarianceAnalysisCapitalDecisionMaking I See The Light Projected Income Statement For the Period Ending December 31, 20x1 PART 1 Fixed and Variable Cost Determinations Unit Cost Calculations The projected cost of a lamp is calculated based upon the projected increases or decreases to current costs. The present costs to manufacture one lamp are: Expected increases for 202 When calculating projected increases round to TWO ($0.00) decimal places. 1. Material Costs are expected to increase by 4.50%. 2. Labor Costs are expected to increase by 5.00%. 3. Variable Overhead is expected to increase by 4.50%. 4. Fixed Overhead is expected to increase to $270,000. 5. Fixed Administrative expenses are expected to increase to $62,000. 6. Variable selling expenses (measured on a per lamp basis) are expected to increase by 4.00%. 7. Fixed selling expenses are expected to be $27,000 in 202. 8. Variable administrative expenses (measured a per lamp basis) are expected to increase by 5.00%. On the following schedule develop the following figures: I See The Light, Inc Schedule of Projected Costs Variable Manufacturing Unit Cost Lamp Kit Labor Variable Overhead Projected Variable Manufacturing Cost Per Unit Total Variable Cost Per Unit Variable Selling Variable Administrative Projected Variable Manufacturing Unit Cost Projected Total Variable Cost Per Unit Schedule of Fixed Costs Fixed Overhead (normal capacity of Fixed Selling Fixed Administrative Projected Total Fixed Costs {4.01} [4.02} \{4.03\} {4.04} {4.05} {4.06} {4.04} 14.04 (4.07) (4.08) [4.09} {4.10} (4.11) Big Al is about to begin work on the budget for 202 and they have requested that you prepare an analysis based on the following assumptions Note: Remember, that we cannot sell part of a lamp, therefore to find the number of units you have to round up to the next complete unit. Furthuremore, to find the required sales in dollars it may be easier to find the number of units and then multiply by the selling price per unit. 1. For 20x2 the selling price per lamp will be $45.00. What is the projected contribution margin and contribution mamin ratio for earh lamn snld? Contribution Margin Ratio (Round to four places, % is two of those places rk intw) For 20x2 the selling price per lamp will be $45,00. The desired net income in 20x2 is $187,500, What For 20x2 the selling price per lamp will be $45.00. If the foced cost increase by $55,000.00 how many lamps miiet ha enid kn kroaluaian? Breakeven sales in units (Since we cannot sell pact of a unit round up to the next unit if needed) 4. For 202 the selling price per lamp will be $45.00. If the variable cost increase by $5.50 a unit how many lamps must be sold to breakeven? Breakeven sales in units (Since we cannot sell part of a unit round up to the next unit it needed) 5. For 202 the selling price per lamp will be $45.00. If the variable cost decreased by $5.50 a unit how many lamps must be sold to breakeven? 6. If for 20x2 the selling price per lamp is increased to $50.50 a unit how many lamps must be sold in hrakauan? 7. If for 20x2 the selling price per lamp is decreased to $39.50 a unit how many lamps must be scid th hravavan? 5965 PART 3 Budgets Division N has decided to develop its budget based upon projected sales of 43,000 lamps at $50.00 per lamp. The company has requested that you prepare a master budget for the year. This budget is to be used for planning and control of operations and should be composed of: 1. Production Budget 2. Materials Budget 3. Direct Labor Budget 4. Factory Overhead Budget 5. Seling and Administrative Budget 6. Cost of Goods Sold Buoget 7. Budgeted income Statement 8. Cash Budget Notes for Budgeting: The company wants to maintain the same number of units in the beginning and ending inventories of work-in-process, and electrical parts while increasing the inventory of Lamp Kits to 575 pieces and decreasing the finished goods by 20%. Complete the following budgets 1 Production Bunget Planned Sales Desired Ending Inventory of Finished Goods Total Needed Less: Beginning liventory Total Production \begin{tabular}{|r|} \hline(300020%)=2400 \\ \hline 45400 \\ \hline 3000 \\ \hline 42.400 units \\ \hline \end{tabular} [7.01] 6965 2 Materials Budget Lamp Kits Needed for Production Desired Ending Inventory Total Needed Less: Beginning Inventory Total Purchases Cost per piece Cost of Purchases (Round to two places, \$\#\#.\#\#\#) 3 Direct Labor Budget Labor Cost Per Lamp Production Total Labor Cost (Round to two places, \$\#\#.\#\#\#) 4 Eactory Overhead Budget Variable Factory Overhead: Variable Factory Overhead Cost Per Unit Number of Units to be Produced Total Variable Factory Overhead (Round to two places, \$i.n.H\#) Fixed Factory Overhead Total Factory Overhead (Round to two places, \$H\#.\#\#) [8.01] 18.021 {8.03} \{8.04\} 18.05\} (8.06) 18.07| \{8.08\} (8.09) (8.10) \{8.11\} Page 9 Ivan West 6965 4 Eactor Overhead Budoet Overhead Allocation rate based on: 1. Number of Units Total Factory Overhead / Number of Units (Round to two places, \$4.\#.MH) \begin{tabular}{|l|l|l|} \hline & & \\ \hline & & \\ \hline & & $8.46 \\ \hline \end{tabular} (9.01) 5 Cost of making one unit next year Cost of one Lamp Kit Labor Cost Per Lamp Factory overhead per unit Total cost of one unit (Round to two places, \$\#\#\#..\#H) \begin{tabular}{|l|r|r|} \hline & & 16.72 \\ \hline & & $2.10 \\ \hline & & 8.46 \\ \hline & & $27.28 \\ \hline \end{tabular} (9.02) (9.03) 6 Selling and Admin. Budget Fixed Selling Variable Selling (Round to two places, \$\#\#..\#\#) Fixed Administrative Variable Administrative (Round to two places, \$H\#\#.nH) Total Selling and Administrative (Round to two places, \$m..m) 7 Goods Sold Budget . Beginning Inventory, Finished Goods Production Costs: Materials: Lamp Kits: Beginning Inventory Purchased Available for Use Ending Inventory of Lamp Kits Lamp Kits Used In Production Total Materials: Labor Overhead Cost of Goods Available Less: Ending Inventory, Finished Goods Cost of Goods Sold {9.04} (9.05) (9.06) Round dollars to two places, \$H\#...H\# {9.07} 19.08 19.09\} (9.10) (9.11) {9.12} (9.13) 19.14) 8 Cash Budget Assume actual cash receipts and disbursements will follow the pattem below: (Note: Recelvables and Payables of 12/31 tx1 will have a cash impact in 202.) 1. 16.00% of sales for the year are made in November and December. Since our customers have 60 day terms those funds will be collected be collected in January and February. 2. 85.00% of material purchases will be paid during the year, the remaining portion will be paid in Januay or February. 3. All other manufacturing and operating costs are paid for when incurred. 4. The budgeted depreciation expense is equal to 0.6% of the fixed manufacturing, seling and administrative expenses. 5. Minimum Cash Balance needed for 202,$175,000. I See The Light Projected Cash Budget For the Year Ending December 31, 20x2 Rinuind rinillars in twn To keep records of the actual cost of a special order job, a Job Order Cost System has been developed. Overhead is applied at the rate of 50% of the direct labor cost. Job Order Costing Section On January 1, 20x2, Division S began Job 2407 for the Clent. THE BIG CHILDREN STORE. The job called for 4,000 customized lamps. The following set of transactions occurred from January 5 untl the job was completed: 5.Jan Purchased 4,050 Lamp Kits \& $16.60 per kit. 9-Jan 4,050 sets of Lamp Kits were requisitioned. 17. Jan Payrol of 610 Direct Labor Hours (i) $9.65 per hour. 30-Jan Payroll of 660 Direct Labor Hours @ $9.90 per hour. 30-Jan 3,990 lamps were completed and shipped. All materials requisitioned were used or scrapped, and are a cost of normal processing. Round Cost of Direct Material Incurred in Manufacturina Job 2407 Cost of Manifarturinn Ouarheact Annlied th .lah 2407 To keep records of the actual cost of a special order job, a Job Order Cost System has been developed. Overhead is applied at the rale of 50% of the direct labor cost. Job Order Costing Section On January 1, 20x2, Division 5 began Job 2407 for the Clent, THE BIG CHILDREN STORE. The job called for 4,000 customized lamps. The following set of transactions occurred from January 5 unti the job was comploted: 5. Jan Purchased 4,050 Lamp Kits in $16.60 per kit. 9-Jan 4,050 sets of Lamp Kits were requisitioned 17-Jan Payrol of 610 Direct Labor Hours (88 $9.65 per hour. 30-Jan Payroll of 660 Direct Labor Hours \& $9.90 per hour. 30-Jan 3,990 lamps were completed and shipped. All materials requisitioned were used or scrapped, and are a cost of normal processing. Round to two places. \$wis t Cost of Piract Matarial lamimad in Manidactivime wh Zant [13.01} Cost of Manudarthirion Nuarhead Annilied th . Inh 207 13.021 [13.03] Cost of mandednatuaiain nama lomon Speciai order lamps are manufactured in division S. Because of the precise nature of the process a standard cost system has been developed. The following standards are used for the special orders: * Fixed overhead is based on expected production of 4,010 customized lamps each month. To keep records of the actual cost of a job, a Job Order Cost System has been developed. Entries are made to the Job Order System at actual cost (overhead is applied based on actual labor hours) While entries are made to the accounting system at standard. Variance analysis is used to analyze the differences. Job Order Costing Section On January 1, 20x2, Division S began Job 1101 for the Client. THE BIG CHILDREN STORE. The job called for 4,000 customized lamps. The following set of transactions occurred from January 5 until the job was completed: 5-Jan Purchased 4,050 Lamp Kits @. \$16.60 per kit. 9-Jan 4,050 sets of Lamp Kits were roquisitioned. 17-Jan Payroll of 610 Direct Labor Hours (A) $9.65 per hour. 30-Jan Payroll of 660 Direct Labor Hours i\& $9.90 per hour. 30-Jan 3,990 lamps were completed and shipped. All materials requisitioned were used or scrappod. How many Lamps were completed? Note: Show favorable variances as negative numbers What was the total material price variance for the Lamp Kits purchased? What was the material usage variance for Lamp Kits? What was the direct labor efficiency variance? What was the direct labor rate variance? Note: Show favorable variances as negative numbers What was the variable overhead efficiency variance? What was the variable OH spending variance ? What is the fixed OH volume (denominator) variance? What is the fixed OH spending variance? Big Al gives his worker's a one hour lunch and two fifleen minute breaks each day. He believes that a cold soda machine would be appreciated by his workers, and an appreciated worker is a good worker. He has priced a machine at a national member only warehouse for $1,950. The machine should be usable for 3 years, after which it would be inefficient, obsolete and would have to be disposed of at the dump. Big Al believes that 10 cans a day will be purchased. The plant is open five days a week, 50 weeks per year. A case of soda (24 cans) costs $6.00 and Big A believes that a price of $.90 per can would win him good will. What is the es. (17.01) What is the contribution marain ser can of soda? (rounded to two blaces. St diti) [17.02] How many cans of soda must be sold each year to breakeven? (Round up to zero places. Wini, ,adw cans) (17.04) What is the pauhark nariod in vases? Irnanded th tun nlaces tt an warel {17.05}