managerial accounting

Question 1(14 marks) Irish Linens Inc. manufactures two products, a finely woven tea towel and a table runner. As the accountant for the company, you have been analyzing the accounts determine the behaviour of the manufacturing overhead. The previous accountant direct labour hours, as she believed it was the most appropriate driver. However, the company has gone through significant automation, and you believe that machine ho may be the better driver. The following information has been gathered: Labour Manufacturing Month hours overhead January 4,580 $1,067,869 February 4,503 1,074,792 March 4,365 1,068,344 April 4,134 1,044,164 3,927 1.022.968 June 3,804 1,037,620 July 3,957 1,042,640 August 4,158 1,032,056 September 4,029 1,051 244 October 4,245 1,054,024 November 4,469 1,063,254 December 4,692 1,072,484 May Using 20 observations including the above, you have run a regression analysis following summary outputs: MERYOPIT M C. . NEW Bere. IZ ANT DU 1 Por 1.MES LYN LON MA 743214TH 932 Pro In addition, a similar analysis has been done on machine hours: Machine Manufacturing Month hours overhead January 7.802 $1,067.869 February 6,500 1,074,792 March 7,195 1.068,344 April 6.502 1,044,164 May 5,885 1,022.968 June 5,512 1,037,620 July 6,081 1,042,640 August 6,578 1,032,056 September 6.198 1,051 244 October 6,694 1,054,024 November 7,517 1,063,254 December 7.976 1,072,484 Using 20 observations including the above information, the regression analysis on machine hours produced a summary output as follows: MS 1112 IDE 1. pl . Loww low 4 WL For the last batch of the year. Opaskwayak processed 1,000,000 pre purification litres with the following direct labour hours and machine hours: Department Direct labour hours Machine hours Transportation 50 221 Purification 28 75 Carbonation 95 192 Frut 100 167 Botting 85 20 Processing this final balch took 2,500 kilograms of cranberries, of which 2.458 lograms remained after sorting. This produced 4,916 litres of juice. Bottling costs are allocated on the basis of volume processed. Assume that $24,520 in direct materials is added in Carbonation 52,675 in Fruit, and $1,090 in Bottling Required: a) Compute each department's manufacturing overhead rate, assuming that Opaskwayak uses a normal department rate based on the planned manufacturing overhead (25 marks) b) Calculate the total Joint costs for the last batch of the year using the manufacturing overhead rates calculated in part (a). (4 marks) c) Calculate the cost of bottling and carbonating the water and adding the fruit syrup for the last batch of the year based on the manufacturing overhead rates calculated in part (a), (4.5 marks) d) Determine how much of each product was produced in the final batch based on the current production breakdown. (1 mark) e) Using the net realizable value method and the planned amounts, as well as the amounts calculated in parts (c) and (d), allocate the joint costs of Transportation and Purification to the final batch produced. (7.5 marks) Using the joint costs calculated in question 20, calculate the cost of the final batch cranberry.flavoured carbonated water using activity-based costing for the costs in the Fruit department. (6.5 marks) Question 3 (20 marks) The Farad Old-Fashioned Soda Company (Farad) makes a line of old-fashioned soda for sale in grocery stores. The Tonic Water flavour goes through the All the raw materials Pro PROJECT 1 (50 MARKS) Project 1 is due at the end of Week 3. It is out of 60 marks Question 1 (14 marks) Irish Linens Inc manufactures two products, a finely woven tea towel and a table runner. As the accountant for the company, you have been analyzing the accounts to determine the behaviour of the manufacturing overhead. The previous accountant us direct labour hours, as she believed it was the most appropriate driver. However, the company has gone through significant automation, and you believe that machine hou may be the better driver. The following information has been gathered: Labour Manufacturing Month hours overhead January 4,580 $1.067 369 February 4,503 1,074,792 March 4,365 1,088,344 April 4,134 1,044,164 May 3.327 1,022 968 June 3,804 1,037.620 3,957 1,042,640 August 4,158 1,032 056 September 4,029 1,051,244 October 4245 1,054,024 November 4.409 1,063 254 December 4,892 1,072,484 Using 20 observations including the above, you have run a regression analysis with following summary outputs: ME ADAMU Si on Inmediate Management Accounting Project In addition, a similar analysis has been done on machine hours: Machine Manufacturing Month hours overhead January 7,802 $1,067.869 February 6,500 1,074,792 March 7.195 1,068,344 April 6,502 1,044, 164 May 5,885 1,022.968 June 5,512 1,037,620 July 6,081 1,042,640 August 6.57a 1,032,056 September 6,198 1,051,244 October 6,894 1,054,024 November 7,517 1,063,254 December 7,976 1,072,484 Using 20 observations including the above information, the regression analysis on machine hours produced a summary output as follows: SUMMORUT w M . Total 11 11 he For the last batch of the your Opaskwayak processed 1,000,000 pre-purification litres with the following direct labour hours and machine hours: Department Direct labour hours Machine hours Transportation 50 221 Purification 28 75 Carbonation 95 192 Fruit 100 167 Bottling 85 20 Processing this final batch took 2,500 kilograms of cranberries, of which 2,458 kilograms remained after sorting. This produced 4,916 litres of juice Bottling costs are allocated on the basis of volume processed. Assume that $24,520 in direct materials is added in Cartonation, $2,675 in Fruit, and $1,090 in Bottling. Required: a) Compute each department's manufacturing overhead rate, assuming that Opaskwayak uses a normal department rate based on the planned manufacturing overhead (2.5 marks) b) Calculate the total joint costs for the last batch of the year using the manufacturing overhead rates calculated in part(a) (4 marks) c) Calculate the cost of bottling and carbonating the water and adding the fruit syrup for the last batch of the year based on the manufacturing overhead rates calculated in part (a). (4.5 marks) d) Determine how much of each product was produced in the final batch based on the current production breakdown. (1 mark) e) Using the net realizable value method and the planned amounts, as well as the amounts calculated in parts (c) and (d), allocate the joint costs of Transportation and Purification to the final batch produced, (7.5 marks) 1) Using the joint costs calculated in question 2e, calculate the cost of the final batch o cranberry-flavoured carbonated water using activity-based costing for the costs in the Fruil department. (6.5 marks) son Question 1(14 marks) Irish Linens Inc. manufactures two products, a finely woven tea towel and a table runner. As the accountant for the company, you have been analyzing the accounts determine the behaviour of the manufacturing overhead. The previous accountant direct labour hours, as she believed it was the most appropriate driver. However, the company has gone through significant automation, and you believe that machine ho may be the better driver. The following information has been gathered: Labour Manufacturing Month hours overhead January 4,580 $1,067,869 February 4,503 1,074,792 March 4,365 1,068,344 April 4,134 1,044,164 3,927 1.022.968 June 3,804 1,037,620 July 3,957 1,042,640 August 4,158 1,032,056 September 4,029 1,051 244 October 4,245 1,054,024 November 4,469 1,063,254 December 4,692 1,072,484 May Using 20 observations including the above, you have run a regression analysis following summary outputs: MERYOPIT M C. . NEW Bere. IZ ANT DU 1 Por 1.MES LYN LON MA 743214TH 932 Pro In addition, a similar analysis has been done on machine hours: Machine Manufacturing Month hours overhead January 7.802 $1,067.869 February 6,500 1,074,792 March 7,195 1.068,344 April 6.502 1,044,164 May 5,885 1,022.968 June 5,512 1,037,620 July 6,081 1,042,640 August 6,578 1,032,056 September 6.198 1,051 244 October 6,694 1,054,024 November 7,517 1,063,254 December 7.976 1,072,484 Using 20 observations including the above information, the regression analysis on machine hours produced a summary output as follows: MS 1112 IDE 1. pl . Loww low 4 WL For the last batch of the year. Opaskwayak processed 1,000,000 pre purification litres with the following direct labour hours and machine hours: Department Direct labour hours Machine hours Transportation 50 221 Purification 28 75 Carbonation 95 192 Frut 100 167 Botting 85 20 Processing this final balch took 2,500 kilograms of cranberries, of which 2.458 lograms remained after sorting. This produced 4,916 litres of juice. Bottling costs are allocated on the basis of volume processed. Assume that $24,520 in direct materials is added in Carbonation 52,675 in Fruit, and $1,090 in Bottling Required: a) Compute each department's manufacturing overhead rate, assuming that Opaskwayak uses a normal department rate based on the planned manufacturing overhead (25 marks) b) Calculate the total Joint costs for the last batch of the year using the manufacturing overhead rates calculated in part (a). (4 marks) c) Calculate the cost of bottling and carbonating the water and adding the fruit syrup for the last batch of the year based on the manufacturing overhead rates calculated in part (a), (4.5 marks) d) Determine how much of each product was produced in the final batch based on the current production breakdown. (1 mark) e) Using the net realizable value method and the planned amounts, as well as the amounts calculated in parts (c) and (d), allocate the joint costs of Transportation and Purification to the final batch produced. (7.5 marks) Using the joint costs calculated in question 20, calculate the cost of the final batch cranberry.flavoured carbonated water using activity-based costing for the costs in the Fruit department. (6.5 marks) Question 3 (20 marks) The Farad Old-Fashioned Soda Company (Farad) makes a line of old-fashioned soda for sale in grocery stores. The Tonic Water flavour goes through the All the raw materials Pro PROJECT 1 (50 MARKS) Project 1 is due at the end of Week 3. It is out of 60 marks Question 1 (14 marks) Irish Linens Inc manufactures two products, a finely woven tea towel and a table runner. As the accountant for the company, you have been analyzing the accounts to determine the behaviour of the manufacturing overhead. The previous accountant us direct labour hours, as she believed it was the most appropriate driver. However, the company has gone through significant automation, and you believe that machine hou may be the better driver. The following information has been gathered: Labour Manufacturing Month hours overhead January 4,580 $1.067 369 February 4,503 1,074,792 March 4,365 1,088,344 April 4,134 1,044,164 May 3.327 1,022 968 June 3,804 1,037.620 3,957 1,042,640 August 4,158 1,032 056 September 4,029 1,051,244 October 4245 1,054,024 November 4.409 1,063 254 December 4,892 1,072,484 Using 20 observations including the above, you have run a regression analysis with following summary outputs: ME ADAMU Si on Inmediate Management Accounting Project In addition, a similar analysis has been done on machine hours: Machine Manufacturing Month hours overhead January 7,802 $1,067.869 February 6,500 1,074,792 March 7.195 1,068,344 April 6,502 1,044, 164 May 5,885 1,022.968 June 5,512 1,037,620 July 6,081 1,042,640 August 6.57a 1,032,056 September 6,198 1,051,244 October 6,894 1,054,024 November 7,517 1,063,254 December 7,976 1,072,484 Using 20 observations including the above information, the regression analysis on machine hours produced a summary output as follows: SUMMORUT w M . Total 11 11 he For the last batch of the your Opaskwayak processed 1,000,000 pre-purification litres with the following direct labour hours and machine hours: Department Direct labour hours Machine hours Transportation 50 221 Purification 28 75 Carbonation 95 192 Fruit 100 167 Bottling 85 20 Processing this final batch took 2,500 kilograms of cranberries, of which 2,458 kilograms remained after sorting. This produced 4,916 litres of juice Bottling costs are allocated on the basis of volume processed. Assume that $24,520 in direct materials is added in Cartonation, $2,675 in Fruit, and $1,090 in Bottling. Required: a) Compute each department's manufacturing overhead rate, assuming that Opaskwayak uses a normal department rate based on the planned manufacturing overhead (2.5 marks) b) Calculate the total joint costs for the last batch of the year using the manufacturing overhead rates calculated in part(a) (4 marks) c) Calculate the cost of bottling and carbonating the water and adding the fruit syrup for the last batch of the year based on the manufacturing overhead rates calculated in part (a). (4.5 marks) d) Determine how much of each product was produced in the final batch based on the current production breakdown. (1 mark) e) Using the net realizable value method and the planned amounts, as well as the amounts calculated in parts (c) and (d), allocate the joint costs of Transportation and Purification to the final batch produced, (7.5 marks) 1) Using the joint costs calculated in question 2e, calculate the cost of the final batch o cranberry-flavoured carbonated water using activity-based costing for the costs in the Fruil department. (6.5 marks) son