Do My Online Managerial Accounting Assignment at lowest price

Question - Question 1 IBI has just completed a year of operations, and the controller has called a meeting for tomorrow morning. As the assistant controller, you are asked to prepare the following: •Schedule of cost of goods manufactured •Income statement These will be presented to the executive committee at the meeting. Unfortunately, the last week of the fiscal year’s transactions have not yet been entered into the company’s computer system. You quickly print out a copy of the general ledger (Table 1-1) and the job cost sheets (Table 1-2) for all jobs in progress during the last week of December. (Note that all transactions in the general ledger for the first 51 weeks of the year have been summarized.) You are also able ...Read More to locate the last week of transactions in a folder on the bookkeeper’s desk. The transactions in the folder consist of the following: Dec 23Depreciation to be recorded for the year: $910,000 (90% relates to plant assets, and the remainder relates to selling and administrative assets). Dec 23The production manager has issued a request to open up a new job by filling in a new job cost sheet with the following information and updating the appropriate accounts: Job Description Ethiopian Yirgacheffe Job number EY-096 Kilos 5,500 Date initiated December 23 Direct materials requisitioned by the Roasting department (requisition R282) $37,000 Dec 27Salaries and wages for the last week of the year were incurred as follows: Indirect labour: $3,700 Selling and administrative salaries $4,200 Direct labour is recorded to the job and to the work in process account: Job No. Department Ticket No. Cost EH-287 Packaging T52210 $815 ES-192 Blending T52337 *$4,500 ES-192 Packaging T52210 $425 EY-096 Roasting T52094 $1,430 TOTAL $7,170 
*The production manager noted that due to poor scheduling, the work completed on Job ES-192 was charged overtime at 1.5 times the normal rate, as staff had to work on the job after regular hours. 

Note to students: Record the entries in the ledgers and, where required, on the appropriate job cost sheet.Dec 28Indirect materials issued to production during the last week of the year: $1,800

IBI assigns manufacturing overhead to products based on machine hours when the job is complete or at year end. At the beginning of the year, it was estimated that manufacturing overhead would cost $2,700,000 and there would be 50,000 machine hours. Required a.What is the manufacturing overhead application rate (predetermined overhead rate)? Show calculations. b.Using the data provided, post the transactions that took place for the last week of the year to the ledgers and to the appropriate job cost sheets. (You can copy and paste the ledger accounts and job cost sheets provided in Exhibit A1Q1.) 
Show the activity in the job cost sheets and the following accounts (before any adjusting entries for over- or underapplied overhead):

Raw materials
Work in progress
Finished goods 
Cost of goods sold
Manufacturing overhead
Selling and administrative expenses
Sales 
Dec 28Production has reported the following machine hours: Job number Activity EH-287 Packaging — Machine hours: 10 ES-192 Blending — Machine hours: 65 ES-192 Packaging — Machine hours: 11 EY-096 Roasting — Machine hours: 25 
Note to students: Record machine hours on the appropriate job cost sheet but do not apply overhead at this point.

Production has reported the following: Job number Activity EH-287 Job is complete. Entered date completed on job cost sheet, applied overhead based on machine hours, and transferred costs to finished goods. ES-192 Issued $4,000 of direct materials to packaging (requisition number R289). 
Note to students: Record the entries on the appropriate job cost sheets and the ledgers.Dec 29Miscellaneous selling and administrative costs incurred in the last week of December: $6,500Dec 30Sales for the last week of December (all on accounts) totalled $210,000. The cost of the sales was $162,400Dec 31December bill for plant utilities received for $12,850Dec 31Note to students: Apply overhead to all jobs in work in process at year end based on machine hours using the predetermined overhead rate.


Hint: The job cost sheets for all jobs in progress are really the subledgers for the Work in Process account. Dollar amounts entered on the job cost sheet should also be entered in the ledgers. Therefore, the total of all costs on the job cost sheet should equal the balance in the Work in Process account. c.Prepare a schedule of Cost of Goods Manufactured in good form for the year ended December 31. Hint: Show the total for all overhead transactions and adjust for over- or underapplied overhead to reflect overhead applied. d.Prepare a journal entry to close any balance in the Manufacturing Overhead account to Cost of Goods Sold. (½ mark) e.Prepare the income statement in good form for the year ended December 31. f.Give two reasons why overhead might be underapplied in a given year. g.As the new assistant controller, you will be responsible for preparing the annual management reports. The company is approaching the end of its fiscal year, and the president has called a meeting with the marketing manager, the production manager, and you. During the meeting, the president informs the team that sales are down and profits look like they are going to be lower than planned. The executive team is considering expanding the company’s product lines; however, this action will require a substantial loan from the bank for capital investments. Thus, the president, who is the head of the executive team, wants to ensure that profits are at least equal to or greater than last year’s. One of the executive team members has listed the following actions that could be taken to increase profits for the current year: 1.Reduce the sales price of high-volume IBI coffee in order to increase sales. 2.Extend the current year’s cutoff date for sales to January 15 in order to include next year’s sales with the current sales. 3.Reduce the overhead application rate for the last part of the fiscal year. i.Based on the information in the question, explain why the president would want to manage the profits. ii.Explain whether each of the actions is ethical and any concerns you might have with carrying out any of the actions. Table 1-1: General ledger accounts International Beans, Inc. ACCOUNT:Raw Materials DescriptionDebitCreditBalance Beginning 63,000 DR

Jan-DecRaw materials purchased7,245,000 7,308,000 DRJan-DecIndirect material issued to production 110,200 7,197,800 DRJan-DecDirect materials issued to production 7,092,700 105,100 DR ACCOUNT:Work in Process Description Debit Credit Balance Beginning 63,870 DRJan-DecDirect labour525,300 589,170 DRJan-DecOverhead applied2,592,000 3,181,170 DRJan-DecDirect materials7,092,700 10,273,870 DRJan-DecTransferred to finished goods 10,180,000 93,870 DR ACCOUNT:Finished Goods Description Debit Credit Balance

Beginning 100,000 DRJan-DecTransferred from work in progress10,180,000 10,280,000 DRJan-DecTransferred to cost of goods sold 10,016,400 263,600 DR ACCOUNT:Cost of Goods Sold Description Debit Credit Balance Jan-DecCost of sales from finished goods10,016,400 10,016,400 DR ACCOUNT:Manufacturing Overhead Description Debit Credit Balance Jan-DecOverhead costs1,750,000 1,750,000 DRJan-DecOverhead applied to jobs 2,592,000 - 842,000 CR

Table 1-2: Job cost sheets ACCOUNT:Selling and Admin. Expenses Description Debit Credit Balance Jan-DecSelling and admin. salaries 618,000 618,000 DR ACCOUNT:Sales Description Debit Credit Balance Jan-DecSales 13,020,000 - 13,020,000CR

"

"

" ...Read Less

Solution Preview - No Solution Preview Available

Original Question Documents

N/A