The questions for managerial accounting are attached below.

QUESTION 2 (Not a repeat question.) Guess Klein produces designer clothing such as Tshirts and jeans from fabric purchased from several nearby factories. The company's factory has two departments, Cutting and Sewing. The Cutting department, which cuts the garments from patterns, is a machine-intensive operation. It takes three times longer to cut and sew jeans compared to Tshirts. The Sewing department stitches the cut fabric, sews zippers and buttons and does quality checking. While stitching is highly automated, sewing zippers and buttons and performing quality checks is manual. Direct materials are traced to individual products but direct labor is treated as a single cost pool and averaged across all garments produced. Nearly 80% of the labor hours in the Sewing department are for manual sewing of zippers and buttons on jeans. T-shirts typically do not have zippers or buttons. The company uses a traditional department based overhead allocation system. It assigns overhead to departments and charges them to products using departmental rates. Cutting Department overhead is allocated using machine hours and Sewing Department overhead is allocated using number of garments produced. The indirect costs and the bases used for allocating them to the departments are shown in the Table below. During the current period, 50,000 jeans and 100,000 T-shirts were produced. A typical shipment consists of 1,000 jeans and 2,000 T-shirts. Table 1 Budgeted Cost Data for Guess Klein Garments Directly Traced Costs: Direct Materials Direct Labor Indirect Labor Equipment depreciated & supplies Indirect Costs allocated: Repairs & maintenance (Machine hours) Employee support costs (Labor hours) Occupancy costs (Square feet) TOTAL COST Overhead Bases: Machine Hours Labor Hours Square Feet Cutting Sewing Total 160,000 40,000 200,000 120,000 75,000 195,000 10,000 10,000 20,000 20,000 60,000 80,000 ? ? ? ? ? ? 200,000 120,000 70,000 885,000 3,000 2,000 3,000 1,000 4,000 2,000 4,000 6,000 5,000 Table 2 Budgeted Product Data for Guess Klein Garments Product Direct Materials Jeans T-shirts Total 125,000 75,000 200,000 Direct Labor (Allocated on garments produced) Machine Hours Garments produced 65,000 3,000 50,000 130,000 1,000 100,000 195,000 4,000 150,000 Assume that the total Sewing Department budgeted overhead cost (both direct and indirect) is $240,000. Assume also that 160,000 garments were actually produced during the year and that actual Sewing Department overhead was $249,000. During the year, overhead was: Over applied by $9,000 Over applied by $7,000 Over applied by $16,000 Under applied by $7,000 QUESTION 7 (Not a repeat question.) Robotics Inc. assembles solar cells in a highly automated environment with a JIT inventory system. The manufacturing plant occupies 50% of the total buildings and grounds. Robotics has a small highly skilled and flexible labor force that has a lifetime employment guarantees. Factory supplies are used in the production of solar cells. About 25% of the plant's utility costs represent connection charges; the rest vary with production. External vendors provide all of the materials and supplies. Sales force is paid entirely on commissions. Advertising spending is set by contract at the beginning of the year. At full capacity, the plant is capable of producing 100,000 units per year. Last year Robotics manufactured and sold 94,000 units for the costs listed below. Cost Item Direct Materials & Parts Direct Labor Production Supervisory Salaries Factory Supplies Plant Utilities Sales Commissions Building/Grounds Maintenance Advertising Administrative Salaries Total The total variable costs last year were: Amount $300,000 350,000 100,000 200,000 60,000 350,000 40,000 100,000 400,000 $190,000 $690,0 00 $910,0 00 $895,0 00 $850,0 00 QUESTION 8 (Not a repeat question.) Robotics Inc. assembles solar cells in a highly automated environment with a JIT inventory system. The manufacturing plant occupies 50% of the total buildings and grounds. Robotics has a small highly skilled and flexible labor force that has a lifetime employment guarantees. Factory supplies are used in the production of solar cells. About 25% of the plant's utility costs represent connection charges; the rest vary with production. External vendors provide all of the materials and supplies. Sales force is paid entirely on commissions. Advertising spending is set by contract at the beginning of the year. At full capacity, the plant is capable of producing 100,000 units per year. Last year Robotics manufactured and sold 94,000 units for the costs listed below. Cost Item Direct Materials & Parts Direct Labor Production Supervisory Salaries Factory Supplies Plant Utilities Sales Commissions Building/Grounds Maintenance Advertising Administrative Salaries Total Amount $300,000 350,000 100,000 200,000 60,000 350,000 40,000 100,000 400,000 $190,000 Assume that the full cost per unit was as follows: Variable costs Fixed costs Total cost per unit $10.00 11.00 $21.00 What is the average full cost per unit if next year the production falls to 86,000 units and there is no change in the unit prices of all cost inputs used by Robotics? $22. 02 $21. 00 $20. 21 $22. 95 QUESTION 9 Geverd & Baran, Inc. (G&B) make hockey helmets in a variety of styles for sales to college hockey programs and use job order costing system. Their plant has two operations - a welding operations where they manufacture the facemask cages out of wire using an automated cutting and welding machine, and an assembly operation where the cages are attached to the head piece to make a complete helemet which is based on direct labor hours. G&B has budgeted $400,000 in manufacturing overhead and 16,000 direct labor hours for 2006. They have a contract to manufacture 40 helmets for Babson College. Each helmet will take 0.8 hours of direct labor at $20 per hour and use $20 of raw materials. The total product cost per helmet for this job using the plantwide overhead rate is: $56. 00 $36. 00 $25. 00 $40. 00 $60. 00