Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Thomas planned to set up a business that build custom house for high net-worth customers in Upstate NY on January 1tt,2023. He would borrow $1,500,000

image text in transcribed
image text in transcribed
Thomas planned to set up a business that build custom house for high net-worth customers in Upstate NY on January 1tt,2023. He would borrow $1,500,000 from a bank to invest in the business as star-up capital and receive a minimum salary of $5,000/ month. Here is the list of some related items or products that he would need to start the business: - Lumber - Roof - Concrete - Insulation - Ducting - Paint - Corporate office building He needs to hire you as an accountant to help his financial and accounting work, and one supervisor who is in charge of the supervision of building custom houses. His business' cost drivers are provided in Table 1. Part 1.1 - Cost Classification (10 points) Required: Thomas needs your help in classifying the various costs. In order to manage these costs, he wants them identified using the information below. He asked that you use Table 2 (page 3) for your answers. a) Bchavior: fixed or variable cost b) Financial reporting: product or period c) If product cost, identify which items are direct materials, direct labor or manufacturing overhead. Part 1.2- Costing Systems (10 points) Thomas discussed the business plan with you. He was told that there are three different types of costing systems that exist in organizations - job order, process costiag and activituhased costing. Required: Which type of costing system is his business most likely to use? Explain

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial Accounting

Authors: Thomas Dyckman, Robert Magee, Glenn Pfeiffer

3rd Edition

1934319600, 978-1934319604

More Books

Students also viewed these Accounting questions

Question

What is the meaning of internal control?

Answered: 1 week ago

Question

Define HRM and its relation to organizational management

Answered: 1 week ago

Question

Explain the theoretical issues surrounding the HRM debate

Answered: 1 week ago