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 AI heard about your skills in managerial accounting and would like your assistance in the following areas: Part 1 Process Costing Part 2 Job Order Costing To upload your work to Big Al the file without changing the name. Pay attention to the specific location that Excel saves the file. Return to the bottom of the page that you downloaded the file from; Cybertext.com, The Book List, Building Blocks of Accounting--A Managerial Perspective, Enter password, Upload Your Excel File. If you upload an old version of the file the results will not update Keep two copies of your spreadsheet in two separate places in case one of Big Al's competitors sends someone to destroy your work or it is lost in transmission. You may find it easier to work on this project if you print a hard copy of all the pages. I See The Light Projected Income Statement For the Period Ending December 31, 20x1 $ 1,125,000.00 750,000.00 $ 375,000.00 Sales 25,000 lamps @ $45.00 Cost of Goods Sold @ $30.00 Gross Profit Selling Expenses: Fixed Variable (Commission per unit) $3.00 Administrative Expenses: Fixed Variable @ $2.00 Total Selling and Administrative Expenses: Net Profit $ 23,000.00 75,000.00 $ 98,000.00 $ 42,000.00 0,000.00 92 190,000.00 $ 185,000.00 I See The Light Projected Balance Sheet As of December 31, 20x1 $ 34,710.00 67,500.00 Current Assets Cash Accounts Receivable Inventory Raw Material Lamp Kits Work in Process Finished Goods Total Current Assets 8,000.00 500 @ $16.00 0 3000 @ $30.00 90,000.00 $ 200,210.00 Fixed Assets Equipment Accumulated Depreciation Total Fixed Assets Total Assets $ 20,000.00 6,800.00 13,200.00 $ 213,410.00 $ $ 54,000.00 54,000.00 Current Liabilities Accounts Payable Total Liabilities Stockholder's Equity Common Stock Retained Earnings Total Stockholder's Equity Total Liabilities and Stockholder's Equity $ 12,000.00 147,410.00 159,410.00 $ 213,410.00 PART 4 Process Costing - First-In First-Out General Information The I See The Light Company has a related company that produces the figurines. They use process costing in the molding department. The factory overhead is applied at a rate of 50% of direct labor dollars. The material is added at the beginning of the process. The labor and overhead costs are assumed to be added uniformly throughout Month of January Selected information for January is presented below. Note that the applied overhead rate was 50% of direct labor costs in the molding department Molding Department Goods in-process as of January 1 were 2,800 figurines at a cost of $47,320.00. Of this amount, $44,800.00 was from raw materials added, $1,680.00 for labor and $840.00 for overhead. These 2,800 figurines were assumed to be 30.00% complete as to labor and overhead. During January, 25,000 units were started, $404,250.00 of materials and $43, 120.00 of labor costs were incurred. The 6,000 figurines that were in-process at the end of January were assumed to be 10.00% complete to labor and overhead All figurines in January passed inspection. January MOLDING Physical Flow of Units Work-in-Process - Beginning Units Started this Period Units to Account for 2.800 units {12.01 25,000 units 27,800 units 12.02 Total transferred out Work-in-Process - Ending 1 Total Accounted for 21,800 units 6,000 units 27,800 units {12.03 12.04 12.05) Equivalent Units Material (Round to three places, It.III.I) 25,000.00 units {12.06 Equivalent Units Conversion (Round to three places, II.III.III) 21,560.00 units {12.07) {} Total cost in the Beginning Inventory (Round to two places, II,III.II) 47,320.00 {12.08 Total cost of Material this period (Round to two places, II.III.II) $ 404,250.00 ( 12.09 Total cost of Conversion this period (Round to two places, II.III.I+) $ 64,680.00 {12.10 Total cost to account for (Round to two places, ##.###.##) 488,930.00 {12.11 Cost per equivalent unit of Material this period (Round to seven places, I!!.I***** $ 16.1700000 {12.12 Cost per equivalent unit of Conversion this period (Round to seven places, I!!.!!!! $ 3.0000000 { 12.13 Cost of the units transferred, material and convesion (Round to two places, $i,It 417,430.00 {12.14 Cost of the ending inventory, material and convesion (Round to two places, $#*+,$ 98,820.00 {12.15) Total Cost accounted for (Round to two places, **** III.II ) $ 417,430.00 { 12.16) PART 5 Job Order Costing 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 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 4,100 sets of Lamp Kits were requisitioned, including all those in the Beginning Inventory 17-Jan Payroll of 610 Direct Labor Hours @ $9.75 per hour. 30-Jan Payroll of 660 Direct Labor Hours @ $10.00 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. Month End Overhead Information Actual Variable Manufacturing Overhead Actual Fixed Manufacturing Overhead $ 1,447.80 $ 40,623.45 Round to two places, $##.## Cost of Direct Material incurred in Manufacturing Job 2407 {13.01) Cost of Direct Labor Incurred in Manufacturing Job 2407 {13.02) Cost of Manufacturing Overhead Applied to Job 2407 {13.03) Cost of manufacturing one lamp {13.04)