On April 1, 2009, a company paid a $24,300 premium on a 36-month insurance policy for coverage beginning on that date. Refer to that policy and fill in the blanks in the following table. (Leave no cells blank - be certain to enter "0" wherever required. Input all the amounts as positive values. Omit the "$" sign in your response.) Balance Sheet Prepaid Insurance Asset Using Insurance Expense Using Accrual Basis Cash Basis Accrual Basis Cash Basis Dec. 31, 2009 $ $ 2009 $ $ Dec. 31, 2010 2010 Dec. 31, 2011 2011 Dec. 31, 2012 2012 Total $ $ 
1) Particulars March June Direct material $36000 $90000 Direct labour $36000 $90000 Total direct cost $ 72000 $180000 For March Cost of goods manufactured =Manufacturing cost + Direct cost $168000 = Manufacturing cost+$72000 Manufacturing cost =$96000 Let the manufacturing overheads be =x Manufacturing cost = Manufacturing overheads + opening work in process -closing work in process $96000 X = x + $9000 -$15000 =$102000 For June Cost of goods manufactured =Manufacturing cost + Direct cost $257000 = Manufacturing cost+$180000 Manufacturing cost =$77000 Let the manufacturing overheads be =x Manufacturing cost = Manufacturing overheads + opening work in process -closing work in process $77000 X = x + $32000 -$21000 =$66000 2) As per figures given in question manufacturing expenses are reducing with increase in activity level which is practically impossible (However as per question variable expenses are negative.) According to high and low method =66000-102000=12 per unit. 3000 3) Particulars Direct material Direct labour Prime cost Manufacturing overheads Total (+) Opening work in progress (-) Closing work in progress Cost of goods manufactured Cost of 7000 units Amount $ 42000 $ 42000 $ 84000 $119000 $203000 $ 10500 ($ 17500) $196000 1) Particulars March June Direct material $36000 $90000 Direct labour $36000 $90000 Total direct cost $ 72000 $180000 For March Cost of goods manufactured =Manufacturing cost + Direct cost $168000 = Manufacturing cost+$72000 Manufacturing cost =$96000 Let the manufacturing overheads be =x Manufacturing cost = Manufacturing overheads + opening work in process -closing work in process $96000 X = x + $9000 -$15000 =$102000 For June Cost of goods manufactured =Manufacturing cost + Direct cost $257000 = Manufacturing cost+$180000 Manufacturing cost =$77000 Let the manufacturing overheads be =x Manufacturing cost = Manufacturing overheads + opening work in process -closing work in process $77000 X = x + $32000 -$21000 =$66000 2) As per figures given in question manufacturing expenses are reducing with increase in activity level which is practically impossible (However as per question variable expenses are negative.) According to high and low method =66000-102000=12 per unit. 3000 3) Particulars Direct material Direct labour Prime cost Manufacturing overheads Total (+) Opening work in progress (-) Closing work in progress Cost of goods manufactured Cost of 7000 units Amount $ 42000 $ 42000 $ 84000 $119000 $203000 $ 10500 ($ 17500) $196000 1) Particulars March June Direct material $36000 $90000 Direct labour $36000 $90000 Total direct cost $ 72000 $180000 For March Cost of goods manufactured =Manufacturing cost + Direct cost $168000 = Manufacturing cost+$72000 Manufacturing cost =$96000 Let the manufacturing overheads be =x Manufacturing cost = Manufacturing overheads + opening work in process -closing work in process $96000 X = x + $9000 -$15000 =$102000 For June Cost of goods manufactured =Manufacturing cost + Direct cost $257000 = Manufacturing cost+$180000 Manufacturing cost =$77000 Let the manufacturing overheads be =x Manufacturing cost = Manufacturing overheads + opening work in process -closing work in process $77000 X = x + $32000 -$21000 =$66000 2) As per figures given in question manufacturing expenses are reducing with increase in activity level which is practically impossible (However as per question variable expenses are negative.) According to high and low method =66000-102000=12 per unit. 3000 3) Particulars Direct material Direct labour Prime cost Manufacturing overheads Total (+) Opening work in progress (-) Closing work in progress Cost of goods manufactured Cost of 7000 units Amount $ 42000 $ 42000 $ 84000 $119000 $203000 $ 10500 ($ 17500) $196000
