The Brandilyn Toy Company manufactures a line of dolls and a doll dress sewing kit (A+ Guaranteed)

The Brandilyn Toy Company manufactures a line of dolls and a doll dress sewing kit. Demand for the dolls is increasing, and management requests assistance from you in determining the best sales and production mix for the coming year. The company has provided the following data:
Product     Demand
Next year
(units)     Selling
Price
per Unit     Direct
Materials     Direct
Labor
Marcy     26,000     $ 36.00        $ 3.00         $ 4.80
Tina     36,000     $ 27.00        $ 1.90         $ 2.40
Cari     36,000     $ 26.00        $ 3.80         $ 9.60
Lenny     47,000     $ 16.00        $ 2.20         $ 6.00
Sewing kit     550,000     $ 14.00        $ 1.20         $ 2.40
The following additional information is available:
a.    The companys plant has a capacity of 167,300 direct labor-hours per year on a single-shift basis. The companys present employees and equipment can produce all five products.
b.     The direct labor rate of $12.00 per hour is expected to remain unchanged during the coming year.
c.     Fixed costs total $336,000 per year. Variable overhead costs are $3.00 per direct labor-hour.
d.     All of the companys nonmanufacturing costs are fixed.
e.     The companys finished goods inventory is negligible and can be ignored.

Required:
1.  Determine the contribution margin per direct labor-hour expended on each product. (Do not round intermediate calculations. Round your answers to 2 decimal places.)
Product     Contribution
Margin per DLH
Marcy     $
Tina     $
Cari     $
Lenny     $
Sewing Kit     $
2. Calculate the total direct labor-hours that will be required to produce the units estimated to be sold during the coming year. (Do not round intermediate calculations.)
Product     Total
DLHs
Marcy
Tina
Cari
Lenny
Sewing Kit

Total DLHs required

3. Determine how much of the current plant capacity brandilyn toy company should allocate to each product
Marcy (Direct Labor Hours)
Tina
Cari
Lenny
Sewing Kit
4. What is the highest price, in terms of a rate per hour, that Brandilyn Toy Company should be willing to pay for additional capacity (that is, for added direct labor time)? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

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Ravenna Company is a merchandiser that uses the indirect method (A+ Guaranteed)

Ravenna Company is a merchandiser that uses the indirect method to prepare the operating activities section of its statement of cash flows. Its balance sheet for this year is as follows:

Ending Balance     Beginning Balance
Cash     $     48,000       $     57,000
Accounts receivable         41,000           44,000
Inventory         55,000           50,000
Property, plant, and equipment         150,000           140,000
Less accumulated depreciation         (50,000)         (35,000)

Total assets     $     244,000       $     256,000

Accounts payable     $     32,000       $     57,000
Income taxes payable         25,000           28,000
Bonds payable         60,000           50,000
Common stock         70,000           60,000
Retained earnings         57,000           61,000

Total liabilities and stockholders’ equity     $     244,000       $     256,000

During the year Ravenna paid a $6,000 cash dividend and it sold a piece of equipment for $3,000 that had originally cost $6,000 and had accumulated depreciation of $4,000. The company did not retire any bonds or repurchase any of its own common stock during the year.

1. Required:
What is the amount of the net increase or decrease in cash and cash equivalents that would be shown on the company’s statement of cash flows? (Input the amount as positive value.)

Net (Click to select)decreaseincrease in cash and cash equivalents     $
2. Required:
What net income would the company include on its statement of cash flows?

Net income     $
3. Required:
How much depreciation would the company add to net income on its statement of cash flows?

Depreciation     $
4. Required:
a.   If the company credited sales and debited accounts receivable for $600,000 during the year, what is the total amount of credits recorded in accounts receivable during the year?

Amount of credits recorded

b.     What does the amount of these credits represent?

Total sales
Cash sales
Credit sales
Cash collections from customers
Payment to suppliers

During the year Ravenna paid a $6,000 cash dividend and it sold a piece of equipment for $3,000 that had originally cost $6,000 and had accumulated depreciation of $4,000. The company did not retire any bonds or repurchase any of its own common stock during the year.
Assume that company credited sales and debited accounts receivable for $600,000 during the year.

5. Required:
a.     What is the amount and direction ( + or ?) of the accounts receivable adjustment to net income in the operating activities section of the statement of cash flows? (Input the amount as positive value.)

Amount     $          (Click to select)Added to net incomeDeducted from net income

b.     What does this adjustment represent?

Cash payments > Cash collected
Cash collected from customers > Credit sales
Cash collected from customers < Credit sales

6. Required:
a.     If the company debited cost of goods sold and credited inventory for $400,000 during the year, what is the total amount of inventory purchases recorded on the debit side of the Inventory T-account and the credit side of the Accounts Payable T-account?

Purchases     $

b-1.     What is the total amount of the debits recorded in the Accounts Payable T-account during the year?

Total amount of debits recorded     $

b-2.   What does the amount of these debits represent?

Purchases
Supplier payments
Sales
Cash collections

During the year Ravenna paid a $6,000 cash dividend and it sold a piece of equipment for $3,000 that had originally cost $6,000 and had accumulated depreciation of $4,000. The company did not retire any bonds or repurchase any of its own common stock during the year.
Assume that the company debited cost of goods sold and credited inventory for $400,000 during the year.

7. Required:
a.     What is the combined amount and direction ( + or ? ) of the inventory and accounts payable adjustments to net income in the operating activities section of the statement of cash flows? (Input the amount as positive value.)

Amount     $       (Click to select)Added to net incomeDeducted from net income

b.     What does this amount represent?
     
Cash paid to suppliers < Cost of goods sold
Cash paid to suppliers > Purchases
Cash paid to suppliers > Cost of goods sold
8. Required:
a.    If the company debited income tax expense and credited income taxes payable $700 during the year, what is the total amount of the debits recorded in the Income Taxes Payable account?

Total amount of debits recorded     $

b. What does the amount of these debits represent?

Taxes payable
Cash paid for income taxes
Tax refunds

During the year Ravenna paid a $6,000 cash dividend and it sold a piece of equipment for $3,000 that had originally cost $6,000 and had accumulated depreciation of $4,000. The company did not retire any bonds or repurchase any of its own common stock during the year.
Assume that the company debited income tax expense and credited income taxes payable $25,000 during the year.

9. Required:
a.     What is the amount and direction ( + or ? ) of the income taxes payable adjustment to net income in the operating activities section of the statement of cash flows? (Input the amount as positive value.)

Amount     $       (Click to select)Added to net incomeDeducted from net income

b.     What does this adjustment represent?

Tax paid < Income tax expenses
Tax paid > Income tax expenses
No taxes are payable

10. Required:
a.     Would the operating activities section of the company’s statement of cash flows contain an adjustment for a gain or a loss?

No
Yes

b.     What would be the amount and direction ( + or ? ) of the adjustment? (Input the amount as positive value.)
(Click to select)Gain ofLoss of  $   (Click to select)Deducted from net incomeAdded to net income

11. Required:
What is the amount of net cash provided by (used in) operating activities in the company’s statement of cash flows? (Input the amount as positive value.)
Net cash (Click to select)provided byused in operating activities     $

12. Required:
What is the amount of gross cash outflows reported in the investing section of the company’s statement of cash flows? (Input the amount as positive value.)
Gross cash outflows     $

13. Required:
What is the company’s net cash provided by (used in) investing activities? (Input the amount as positive value.)
Net cash (Click to select)used inprovided by investing activities     $

14. Required:
What is the amount of gross cash inflows reported in the financing section of the company’s statement of cash flows?

15. Required:
What is the company’s net cash provided by (used in) financing activities? (Input the amount as positive value.)
Net cash (Click to select)provided byused in financing activities     $
Gross cash inflows

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Eban Wares is a division of a major corporation (A+ Guaranteed)

Eban Wares is a division of a major corporation. The following data are for the latest year of operations. Sales of 10,000,000, Net operating income of 950,000, average operating assets of 4,000,000 and the company inimum required rate of return is 14%. The manager of Eban Wares has an opportunity to add a project with the following characteristcs: cost of new equipment of 1,200,000, additional revenues of 3,000,000, and additional expenses of 2,100,000.

a) what is the division’s margin (before the new project)?

b) what is the division’s turnover (before the new project)?

c) what is the division’s return on investment (ROI) (before the new project)?

d) what is the division’s resifual income (before the new project)?

e) what is the division’s margin (after the new project is added)?

f) what is the division’s turnover (after the new project is added)?

g) what is the division’s return on investment (ROI) (after the new project is added)?

h) what is the division’s residual income (after the new project is added)?

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Dunay Corporation is considering investing $850,000 in a project (A+ Guaranteed)

Dunay Corporation is considering investing $850,000 in a project. The life of the project would be 6 years. The project would require additional working capital of $35,000, which would be released for use elsewhere at the end of the project. The annual net cash inflows would be $180,000. The salvage value of the assets used in the project would be $45,000. The company uses a discount rate of 13%. (Ignore income taxes.) Click here to view Exhibit 13B-1 and Exhibit 13B-2 to determine the appropriate discount factor(s) using tables.

Required: Compute the net present value of the project. (Negative amount should be indicated by a minus sign. Round discount factor(s) to 3 decimal places, intermediate and final answers to the nearest dollar amount. Omit the “$” sign in your response.)

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Family Supermarkets has decided to increase the size of its Lansing store (A+ Guaranteed)

Family Supermarkets has decided to increase the size of its Lansing store. It wants information about the profitability of its individual product lines: meats, fresh produce, and packaged food. The following data is for the year 2012 for each product line:

Meats Fresh Produce Packaged Foods
Revenue $795,000 $820,000 $475,000
Cost of goods sold $595,000 $580,000 $355,000
purchase orders 270 323 160
hours of stocking shelves 197 2,107 1,017
items sold 304,000 444,000 103,000

The Company also provides the following information for 2012 for its three support activities:

Support Activity Budgeted Cost Cost Driver
Ordering $122,000 purchase orders
Shelf stocking $79,000 hours of stocking shelves
Customer support $181,000 items sold

Part A
Family Supermarkets currently uses a single-driver system to allocate period costs to its product lines. The single driver that is used is the Cost of Goods Sold for each product line. Using this system, compute the allocation to Fresh Produce.

Part B
If Family Supermarkets instead used an activity-based costing system to allocate period costs, with the cost pools and cost drivers listed in the tables above, how much would be allocated to Packaged Foods?

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The average stockholders’ equity for Horn Co. last year was $3,200,000 (A+ Guaranteed)

The average stockholders’ equity for Horn Co. last year was $3,200,000. Included in this figure was $320,000 of preferred stock. Preferred dividends were $28,000. If the return on common stockholders’ equity was 11.5% for the year, net income was:

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Assume Martin Guitar Company has a standard of 3 hours of direct labor (A+ Guaranteed)

Assume Martin Guitar Company has a standard of 3 hours of direct labor per unit produced and $20 per hour for the labor rate. During last period, the company used 24,000 hours of direct labor at a $456,000 total cost to produce 6,000 units. Compute the direct labor rate and efficiency variances.

Rate Variance: $120,000 unfavorable; Efficiency Variance: $24,000 unfavorable.
Rate Variance: $24,000 favorable; Efficiency Variance: $120,000 unfavorable.
Rate Variance: $24,000 unfavorable; Efficiency Variance: $120,000 favorable.
Rate Variance: $120,000 favorable; Efficiency Variance: $24,000 unfavorable.
Rate Variance: $96,000 favorable; Efficiency Variance: $96,000 unfavorable.

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Rhince and Rynelf decide to merge their proprietorships into a partnership (A+ Guaranteed)

Rhince and Rynelf decide to merge their proprietorships into a partnership called Dawn Treader Company. The balance sheet of Rynelf Co. shows:

Accounts receivable $16,200
Less: Allowance for doubtful accounts

1,215

$14,985
Equipment 15,910
Less: Accumulated depreciation

5,569

10,341

The partners agree that the net realizable value of the receivables is $13,669 and that the fair market value of the equipment is $8,751. Indicate how the four accounts should appear in the opening balance sheet of the partnership.

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Balfour Corporation acquired 100% of Tobac Inc (A+ Guaranteed)

Balfour Corporation acquired 100% of Tobac Inc., a foreign corporation, for 33,000,000 FC. The acquisition, which was accounted for as a purchase, occurred on July 1, 20×5, when Tobac’s equity, in FC, was as follows:

Common Stock                               $19,000,000 FC

Paid-in capital in excess of par        8,480,000

Retained Earnings                              2,520,000

Any excess of of cost over book value is traeable to equipment which is to be depreciated over 10 years. Balfour uses the simple equity method to account for its investment in Tobac.

On April 1, 20X7, Tobac acquired additional equipment costing 4,000,000 FC. Equipment is depreciated by the straight-line method over 10 years. No other equipment had been acquired or disposed of since 20X4. Tobac employs the LIFO inventory method. Ending inventory on December 31, 20X7, consists of the following:

Acquired in the 1st quarter of 20X4              1,000,000 FC

Acquired in the 1st quarter of 20X5                 500,000

Acquired in the 1st quarter of 20X7               6,500,000

The cost of sales is traceable to goods purchased during 20 x 7 as follows:

Acquired uniformly over the last nine months            23,400,000

Acquired in the 1st quarter                                               4,200,000

Other expenses were incurred evenly over the year.

On April 1, 20X7, Tobac borrowed $1,280,000 from parent company in order to help finance the purchase of equipment. The note is due in one year and bears interest at the rate of Various spot rates are as follows:

1 FC =                                                                                $0.60

1st Quarter, 20X4 Average                    $0.46                             December 31, 20X6                 $0.60

20X4 Average                                            0.49                            1st quarter, 20X7 Average        0.62

Janujary 1, 20×5                                        0.51     April 1, 20×7    0.64

1st quarter, 20×5 Average    0.53 20X7 Average 0.67

July 1, 20X5    0.55     Last nine months, 20X7 Average 0.66

December 31, 20×5      0.58 December 31, 2017    0.65

Last six months, 20X5    0.57

20X6 Average    0.58

The December 31, 20×7, trial balances for Tobac and Balfour are as follows:

Balfour    Tobac

Corp. Inc.

Cash                                                                                                      $4,462,200                            $3,087,385 FC

Net Accounts Receivable                                                                   15,350,000                             12,000,000

INventory    16,300,000                           8,000,000

Due from Tobac                                                                                      1,356,800

Investment in Tobac-See Note A                                                       23,712.363

Depreciable Assets                                                                             68,000,000      34,000,000

Accumulated Depreciation    (42,000,000)    ( 12,300,000)

Due to Balfour                 (2,087,385)

Other Liabilities    (27,000,000) ( 3,700,000)

Common STock                                                                                   (35,000,000)                         (19,000,000)

Paid-In Capital in Excess of Par                                                        (2,000,000)                            (8,480,000)

Retained Earnings, January 1, 2017                                                  (4,500,000)                            (7,520,000)

Sales            (98,000,000) (40,000,000)

Cost of Sales 64,000,000 27,600,000

Depreciation Expense    8,076,800 3,300,000

Interest Expense on Balfour

Loan (accrued on December 31, 20×7)-See Note B 118,154

Exchange Gain on Balfour Loan-See Note 8       (30,769)

Other Expenses                           10,000,000 5,012,615

Interest Income (76,800)

Subsidiary Income    (2,682,363)

Total $              0 0FC

Note A-Balfour’s investmentin Tobac consists of the following:

Initial investment (33,000,000 FC x $0.55)        $18,150,000

Last six months, 20X5 income (2,000,000 FC x $0.57     1,140,000

20X6 income (3,000,000 FC x $0.58) 1,740,000

20X7 income    2,682,363

Balance $23,712,363

Note B-The original loan from Balfour was 2,000,000 FC, or $1,280,000(2,000,000 FC x $0.64). On December 31, 20×7, it would require 1,969,231 FC ($1,280,000 + $0.65) to settle the loan. This represents on exchange gain of 30,769 FC (2,000,000 FC – 1,969,231 FC).

The year-end balance due to Balfour is determined as follows:

Principal Balance    $1,969,231 FC

Accrued interest ($1,280,000) x 8% x 9/12 + $0.65) 118,154

Balance    $2,087,385FC

The interest is accrued at year-end; therfore,interest expense should be translatedat the year-end rate.

   Assuming the FC is Tobac’s functional currency, translate Tobac’s trial balance, and prepare a consolidating worksheet.

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Roy’s Toys is a manufacturer of toys and children’s products (A+ Guaranteed)

Roy’s Toys is a manufacturer of toys and children’s products. The following are selected items appearing in a recent balance sheet (dollar amounts are in millions):

Cash and short-term investments     $     48.00
Receivables         153.00
Inventories         72.00
Prepaid expenses and other current assets         39.00
Total current liabilities         134.00
Total liabilities         201.00
Total stockholders’ equity         348

a(1) Using the information above, compute the amounts of Roy’s Toys quick assets.
a(2) Using the information above, compute the amounts of Roy’s Toys total current assets.
b(1) Compute for Roy’s Toys quick ratio.
b(2) Compute for Roy’s Toys current ratio.
b(3) Compute for Roy’s Toys dollar amount of working capital.

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