ADV318J ~ Dudo Chapter 10

Aces Inc., a manufacturer of tennis rackets, began operations this year. The company produced 6,000 rackets and sold 4,900. Each racket was sold at a price of $90. Fixed overhead costs are$78,000, and fixed selling and administrative costs are $65,200. The company also reports the following per unit costs for the year. Prepare an income statement under variable costing.

    Variable production costs$25
    Variable selling and administrative expenses         2

Verified answer

accounting

Camp Bryn Mawr, a summer camp, started the year with cash of $40,000, land costing$300,000, and buildings and equipment costing $250,000. Because the camp had no liabilities, the assets were offset by the equity account F. Jonas, Capital, in the amount of$590,000. The following transactions occurred during the year:

Jonas sent bills in the amount of $150,000 to the parents of 75 campers.
Jonas purchased 80 camper packages (consisting of uniforms and supplies) on credit from a vendor. He received the packages and put them in inventory. He also received a bill for$4,800 (80 packages costing $60 a package) from the vendor.
When they arrived at the camp, each of the 75 campers received a camper package. Jonas sent bills in the amount of$6,750 to the parents, charging them $90 a package.
Jonas received cash in the amount of$148,750 from the parents, based on the bills sent out in transactions 1 and 3.
During the summer, Jonas paid employee salaries in the amount of $100,000 and food expenses of$8,000. (Assume all the food was consumed.)
Jonas paid the invoice for $4,800 for transaction 2.
Anticipating that several parents might not pay their bills, Jonas set up an allowance for uncollectible receivables in the amount of$4,000.
One of the parents, who owed $2,000, declared bankruptcy. Jonas wrote off the account as uncollectible.
Jonas made a provision for depreciation for the year, assuming that the buildings and equipment had a useful life of 20 years.
Jonas promised the camp director a bonus of$5,000, based on the excellent work she had done during the year. Jonas, therefore, accrued a liability for that amount.

Use the preceding information to do the following:

a. Prepare journal entries to record these transactions. (Among others, you will need accounts for Revenues—camper fees, Revenues—uniform sales, and Inventory—uniforms.)
b. Post the journal entries to ledger T-accounts.
c. From the ledger accounts, prepare a trial balance.
d. Using the trial balance, prepare an income statement, a statement of changes in owner’s equity, and a balance sheet.

Verified answer

marketing

Your company plans to send a marketing questionnaire to 40 percent of the names on a mailing list of 20,000 people. The mailing list was purchased from another company for $0.20 per name. Each questionnaire costs$0.10 to print; mailing costs are $0.55 each; and the cost of writing the questionnaire, analyzing the information, and preparing the report is$15,000. What is the total cost?

Verified answer

question

The previous problems used different forecasting methods. Which method appears to provide the more accurate forecasts for the historical data? Explain.

Verified answer