question is attached in the attached document homework assignment 3 question, I need the answer of Question 10 only

Question 1. Armstrong Helmet Company Item Direct Materials Administration Salaries Advertising for Helmets Depreciation on office equipment Insurance on Factory building Miscellaneous Expenses Factory Office supplies expenses Professionals fees Property taxes on factory building Raw materials used Rent on production equipment Research & development Sales commissions Utility costs-factory Wages-factory Total Product Cost Direct Labor Manufacturin g Overhead Period Costs $15,500 11,000 $1,500 800 1,500 1,000 300 500 400 $70,000 6,000 10,000 40,000 900 $70,000 $70,000 $70,000 $11,300 $78,100 Question 2. Item Administration Salaries Advertising for Helmets Depreciation on factory building Insurance on factory building Miscellaneous Expensesfactory Office Supplies Expense Professionals fees Property taxes on factory building Raw materials used Rent on production equipment Research & development Sales commissions Utility costs-factory Wages-factory Total Variable Costs Fixed Costs $15,500 11,000 1,500 Total Costs $15,500 11,000 1,500 800 800 1,000 300 500 400 300 500 400 $1,000 70,000 6,000 10,000 40,000 900 70,000 $181,000 $48,400 70,000 6,000 10,000 40,000 900 70,000 $229,400 Question 3. Armstrong Helmet Company Cost of Goods Manufactured Schedule for the Month Ended December 31, 2013 Work in process, December1 Direct Materials Raw Materials inventory (Dec.1) Raw Materials purchased Less: Raw Material inventory (Dec.1) Direct materials used Direct Labor Manufacturing overhead Rent on production equipment Insurance on factory Building Depreciation on factory building Utility costs- factory Building Miscellaneous expenses-factory Total manufacturing costs Total cost of work in process Less: Work in process Cost of Goods Manufactured 0 0 70,000 0 $70,000 70,000 $6,000 1,500 1,500 900 400 1,000 11,300 $151,300 151,300 0 $151,300 4. Production cost per helmet= $151,300 /10,000= $15.13 5. Production cost per Helmet Company likely uses a process cost system. Process costing is used when large volume of a homogenous product are produced on a continuous basis. Armstrong Helmet Company would find it useful, using a process costing system, to identify the cost of each production batch of bicycle helmets. 6. If the Armstrong decided to produce additional helmets for (baseball,hockey,football,etc) or different model of bicycle helmets, it may find it useful to move a job order costing system. 7. Units variable cost ($181,000 / 10,000 helmets = $18.10 per helmets) 8. Contribution margin per unit= unit selling price- unit variable costs = $40.00 _ $18.10 = $21.90 9. Breakeven point in units = fixed costs/ contribution margin per unit X= $48,400/ $21.90 X= 2,210 helmets. 10. WeyFin-Man1E_Cases_ONLINE.indd Page CA-27 04/11/11 3:11 PM user-F408 /Users/user-F408/Desktop/Merry_X-Mas/New HELME T COMPA NY O STR NG )PNFXPSL\u0001"TTJHONFOU\u0001\u0014 AR M Armstrong Helmet Company Developed by Dick Wasson, Southwestern College The Business Situation Armstrong Helmet Company manufactures a unique model of bicycle helmet. The company began operations December 1, 2013. Its accountant quit the second week of operations, and the company is searching for a replacement. The company has decided to test the knowledge and ability of all candidates interviewing for the position. Each candidate will be provided with the information below and then asked to prepare a series of reports, schedules, budgets, and recommendations based on that information. The information provided to each candidate is as follows. Cost Items and Account Balances Administrative salaries Advertising for helmets Cash, December 1 Depreciation on factory building Depreciation on office equipment Insurance on factory building Miscellaneous expensesfactory Office supplies expense Professional fees Property taxes on factory building Raw materials used Rent on production equipment Research and development Sales commissions Utility costsfactory Wagesfactory Work in process, December 1 Work in process, December 31 Raw materials inventory, December 1 Raw materials inventory, December 31 Raw material purchases Finished goods inventory, December 1 $15,500 11,000 -0- 1,500 800 1,500 1,000 300 500 400 70,000 6,000 10,000 40,000 900 70,000 -0- -0- -0- -0- 70,000 -0- $"\u000e\u0012 WeyFin-Man1E_Cases_ONLINE.indd Page CA-28 04/11/11 3:11 PM user-F408 $"\u000e\u0013 /Users/user-F408/Desktop/Merry_X-Mas/New ARMSTRONG HELMET COMPANY Production and Sales Data Number of helmets produced Expected sales in units for December ($40 unit sales price) Expected sales in units for January Desired ending inventory Direct materials per finished unit Direct materials cost Direct labor hours per unit Direct labor hourly rate 10,000 8,000 10,000 20% of next month's sales 1 kilogram $7 per kilogram .35 $20 Cash Flow Data Cash collections from customers: 75% in month of sale and 25% the following month. Cash payments to suppliers: 75% in month of purchase and 25% the following month. Income tax rate: 45%. Cost of proposed production equipment: $720,000. Manufacturing overhead and selling and administrative costs are paid as incurred. Desired ending cash balance: $30,000. Instructions Using the data presented above (including data on page CA-27), do the following. 1. Classify the costs as either product costs or period costs using a five-column table as shown below. Enter the dollar amount of each cost in the appropriate column and total each classification. Product Costs Item Direct Materials Direct Labor Manufacturing Overhead Period Costs 2. Classify the costs as either variable or fixed costs. Assume there are no mixed costs. Enter the dollar amount of each cost in the appropriate column and total each classification. Use the format shown below. Assume that Utility costsfactory are a fixed cost. Item Variable Costs Fixed Costs Total Costs \u0014 \u000f Prepare a schedule of cost of goods manufactured for the month of December 2013. \u0015 \u000f Determine the cost of producing a helmet. \u0016 \u000f Identify the type of cost accounting system that Armstrong Helmet Company is probably using at this time. Explain. \u0017 \u000f Under what circumstances might Armstrong use a different cost accounting system? \u0018 \u000f Compute the unit variable cost for a helmet. \u0019 \u000f Compute the unit contribution margin and the contribution margin ratio. \u001a \u000f Calculate the break-even point in units and in sales dollars. \u0012 \u0011 \u000f \u0001*EFOUJGZ\u0001POF\u0001QPUFOUJBM\u0001DBVTF\u0001PG\u0001EJSFDU\u0001NBUFSJBMT \u0001EJSFDU\u0001MBCPS \u0001BOE\u0001NBOVGBDUVSJOH\u0001PWFS\u000eIFBE\u0001WBSJBODFT\u0001 JO\u0001UIF\u0001QSPEVDUJPO\u0001PG\u0001UIF\u0001IFMNFU\u000f