Mastery Problem: Introduction to Managerial Accounting Able Baker Charlie Company Managerial vs. Financial Cost Classification Financial Statements HI lll Able Baker Charlie Company Charles Maxwell is starting a cheesecake bakery. Able Baker Charlie Company, to produce and sel different flavored cheesecakes to restaurants and the general public. He has just begun his study of accounting, and is a bit confused about the many types of reports he has read about and how they will help him run his business. He asks you to help him clarity what the differences between managerial accounting and financial accounting are. He's also wondering how to set up his inventory, how to classify the costs of his business, and how to fill in some missing information Required: 1. Choose whether the characteristics on the Managerial vs Financial panel are most often associated with managerial accounting or financial accounting 2. Charles has provided some of the costs he expects to incur on the Cost Classification purel. Decide on the classifications that could be applied to each of these costs using the table provided. The cost object in each case is the cheesecake 3. Charles found some sample income statements and balance sheets on the Internet, and asked which of them might be most appropriate for a manufacturing business like his. Review income statements A and B on the income Statements pare, and balance sheets C and D on the Balance Sheets panel. Determine which income statement and balance sheet would be most appropriate for a manufacturing business like Able Baker Charlie. Then, on the Financial Statements panel, denote which income statement and balance sheet would be most appropriate for a manufacturing business. 4. At the end of February, after the second month of operations of Able Baker Charlie Company, Charles shows you the data he's collected, but he was unable to figure out some of the amounts. On the costs and Balances panel, determine the missing amounts. Note: It may be helpful to use Taccounts to map the flow of the amounts through the manufacturing accounts and solve for the missing dollar values. Managerial vs. Financial Save and Exit Email Instructor Submit Test for Grading All work saved. Calculator use T accounts to map the flow of the amounts through the manufacturing accounts and solve for the missing dollar values. Managerial vs. Financial Choose whether the following characteristics are most often associated with managerial accounting or financial accounting Managerial Accounting Financial Accounting Primarily used for internal decision making Generally Accepted Accounting Principles (GAAP) must be used Prepared statements usually pertain to the company as a whole rather than individual departments of products Information provided will often be subjective, such as estimated future results Often prepared on an as-needed basis rather than at foxed intervals Use principles of the Sustainability Accounting Standards Board (SASB) to provide sustainability information to external financial statement users Consideration of sustainability practices to contribute to the company's long-term success OO c Using eco-efficiency measures to reduce expenses Cost Classification Charles has provided some of the costs he expects to incur as follows. Decide on the classifications that could be applied to each of these costs using the table provided. The cost object Cost Classification Charles has provided some of the costs he expects to incur as follows. Decide on the classifications that could be applied to each of these costs using the table provided. The cost object in each case is the cheesecake Cost Product Cost Period Cost Direct Materials Direct Labor Factory Overhead Selling Expense Administrative Expense Direct Indirect Cost Cost Prime Conversion Cost Eggs used to make cheesecakes Baker's wages BE Delivery driver wages LOO 00 00 00 Depreciation of office computers Power to run the cheesecake ovens President's salary DO Sales commissions DOO DOO Factory supervisor salary Financial Statements Charles found some sample income statements and balance sheets on the Internet, and asked which of them might be most appropriate for a manufacturing business like his Review income statements A and B on the income Statements panel, and balance sheets and D on the Balance Sheets panel. Determine which income statement and balance sheet would be most appropriate for a manufacturing business like Able Baker Charlie Company Email Instructor Save and Submit Test for Grading All work saved Factory supervisor salary Financial Statements Charles found some sample income statements and balance sheets on the Internet, and asked which of them might be most appropriate for a manufacturing business like his. Review income statements A and B on the Income Statements panel, and balance sheets C and D on the Balance Sheets panel. Determine which income statement and balance sheet would be most appropriate for a manufacturing business like Able Baker Charlie Company. Which income statement is most appropriate for a manufacturing business? Income statement A Income statement B Which balance sheet is most appropriate for a manufacturing business? Balance sheet C Balance sheet D Income Statements Income Statement A (scroll down for Income Statement B): Sample Cara Submit Test for Grading Save and Exit Email Instructor All work saved. AL... Income Statement A (scroll down for Income Statement B): Sample Company A Income Statement For the Year Ended December 31, 20Y8 1 Sales $42,000.00 2 $5,250,00 3 6,400.00 4 $11,650.00 Beginning finished goods inventory Cost of goods manufactured Cost of finished goods available for sale Ending finished goods inventory Cost of goods sold 1 Gross profit 5 (400.00) 6 11,250.00 $30,750,00 & Operating expenses: $6,400.00 Selling expenses 9 5.250.00 Administrative expenses 10 Total operating expenses 11.650.00 $19,100.00 12 Net Income Income Statement : Save and Ex Income Statement B: Sample Company B Income Statement For the Year Ended December 31, 20YB 1 Sales $42,000.00 $5,250.00 6,400.00 $11,650.00 (400.00) 11.250.00 2 Beginning inventory 3 Net purchases 4 Inventory available for sale 5 Ending inventory 6 Cost of goods sold 7 Gross profit Operating expenses: Selling expenses 10 Administrative expenses Total operating expenses $30,750,00 $6,400.00 5,250,00 11,650.00 11 $19,100.00 12 Net income Balance Sheets Sample Company C Balance Sheet December 31, 2018 1 Assets 2 Cash $20,800.00 3 Accounts receivable (net) 10,000.00 Inventory 6,000.00 5 Supplies 2,100.00 6 Land 17,000.00 7 Total assets $55,900.00 8 Liabilities $17,800.00 9 Accounts payable 10 Stockholders' Equity $19,000.00 11 Common stock 19,100.00 12 Retained earnings 38,100.00 15 Total stockholders' equity $55,900.00 14 Total liabilities and stockholders' equity Ralance Sheet : ams Saw Email Instructor All work saved. CETAL... Sample Company D Balance Sheet December 31, 20Y8 1 Assets 2 Cash $20 800.00 3 Accounts receivable (net) 10,000.00 4 Inventory: 5 Direct materials $2,500.00 6 Work in process 1,500.00 7 Finished goods 2.000.00 8 Total Inventory 6,000.00 2,100.00 9 Supplies 17.000.00 3D Land 11 Total assets $55,900.00 12 Liabilities $17,800.00 15 Accounts payable 14 Stockholders' Equity $19,000.00 15 Common stock 19,100.00 15 Retained earings 38,100.00 17 Total stockholders' equity $55,900.00 11 Total liabilities and stockholders' equity ams Email Instructor Sovet lculator Costs and Balances At the end of February, after the second month of operations of Able Baker le Company, Charles shows you the data he's collected, but he was unable to figure out some of the amounts. Review the following data and fill in the missing amounts on the chart for Able Baker Charlie Company. Note: It may be helpful to use T accounts to map the flow of the amounts through the manufacturing accounts and solve for the missing dollar values. It may also be helpful to review the steps for determining the cost of materials used, total manufacturing cost incurred, and cost of goods manufactured, Data for February Decrease in materials inventory Materials inventory on Feb. 28 Direct materials purchased Direct materials used Total manufacturing costs incurred in period Total manufacturing costs incurred in period Total manufacturing costs incurred in period $3,600 50% of materials inventory on Jan. 31 $11,700 3 times the direct labor incurred $27 300 70% of Cost of Goods Manufactured $10,000 less than Cost of Goods Sold Account Balances Jan. 31 Feb. 28 Account Materials Inventory Costs Incurred Direct Materials Used $ Direct Labor incurred s 27.000 Work in Process Inventory Finished Goods Inventory 15,500 Factory Overhead incurred Cost of Goods Sold Submit Test for Grading Save and Exit Email Instructor