Reference no: EM131021444

Q1.

The following forecast information relates to operations of Zmart for the month of August and is based on expected production of 50,000 units for the month.

	$
Sales revenue	1,279,662
Manufacturing costs
Variable	595,634
Fixed	283,786
Selling costs
Variable	52,017
Fixed	46,879
Administrative costs
Variable	197,577
Fixed	91,830

If the income tax rate is 38%, calculate how many units need to be sold in August in order to achieve a target profit after tax of $150,000. (Round your final answer to the nearest whole number.)

Q.2 A small local manufacturing company has the following account balances for February:

	$
Depreciation on factory plant	26,037
Direct labour (10,000 hours at $22 per hour)	220,000
Direct materials	50,316
Indirect labour	7,928
Lease costs on plant	16,631
Marketing costs	22,739
Utilities for plant	10,445

The company allocates manufacturing overhead at $6 per direct labour hour.

Calculate the total amount by which manufacturing overheads were over or underallocated for the month of February. (Show an overallocation as a positive figure and an underallocation as a negative figure)

Q.3

A manufacturing company has the following balances at 30 April:

	$
Inventory - direct materials	14,204	Dr.
Inventory - work-in-process	36,710	Dr.
Inventory - finished goods	49,117	Dr.
Manufacturing overhead	3,776	Dr.
Cost of goods sold	74,025	Dr.

During April, raw materials totalling $41,476 were purchased, and $43,179 were requisitioned for the production process. The cost of goods manufactured during April was $97,901, and manufacturing overhead totalling $51,268 was applied to production during the month (at 140% of direct labour cost).

Calculate the balance of Work-in-process Inventory as at 1 April. (Round your answer to the nearest dollar.)

Q.4 A manufacturing company has the following balances at 31 May:

	$
Inventory - direct materials	16,975	Dr.
Inventory - work-in-process	34,629	Dr.
Inventory - finished goods	47,551	Dr.
Manufacturing overhead	3,687	Dr.
Cost of goods sold	70,482	Dr.

During May, raw materials totalling $41,967 were purchased, and $44,738 were requisitioned for the production process. The cost of goods manufactured during May was $109,544, and manufacturing overhead totalling $47,581 was applied to production during the month (at 140% of direct labour cost).

Calculate the balance of Finished Goods Inventory as at 1 May. (Round your answer to the nearest dollar.)

Q.5 If the break-even point is lower than the number of units currently produced, then:

a. The organisation's revenue is less than its total costs

b. The organisation has made a profit

c. The organisation's revenue is greater than its total costs

d. The organisation has made a profit, and total revenue is greater than total costs

Q.6 Managers make use of cost-volume-profit analysis primarily to:

a. record the organisation's revenues and costs

b. generate figures for the organisation's financial statements

c. control the organisation's past performance

d. plan the organisation's future operations

Q7. Cacophony Ltd manufactures custom-made computer equipment. The company applies manufacturing overhead to individual jobs using machine hours as a cost driver. The following costs were budgeted for the forthcoming year:

Direct material costs	$449,460
Direct labour costs	$203,911
Manufacturing overheads	$276,833
Number of machine hours	456,490

Job #996 has incurred direct materials of $1,802, direct labour of $855 and used 956 machine hours.

Calculate the total amount of manufacturing overheads that will be allocated to job #996. (Round your answer to the nearest dollar.)

Q.8 A company is considering launching a new product. It has calculated a break-even point at 1,552 units, at a selling price of $111 per unit. If the company wants a safety margin of $2,000, calculate the number of units that will be need to be sold.

Q9

The following forecast information relates to operations of Zmart for the month of June:

	$
Sales revenue	1,353,593
Manufacturing costs
Variable	557,127
Fixed	282,833
Selling costs
Variable	50,205
Fixed	43,390
Administrative costs
Variable	183,838
Fixed	119,561

 

Calculate the break-even point in sales dollars (revenue) for June. (Round your final answer to the nearest whole number.)

Q.10 A small local manufacturing company has the following account balances for January:

	$
Depreciation on factory plant	21,652
Direct labour (10,000 hours at $22 per hour)	220,000
Direct materials	50,247
Indirect labour	8,087
Lease costs on plant	13,437
Marketing costs	21,592
Utilities for plant	7,305

 

The company allocates manufacturing overhead at $4 per direct labour hour.

Calculate the total amount of manufacturing overhead allocated to products for the month of January.

Q.11. Ludicrous Ltd manufactures holographic golf balls and uses a process costing system to record and calculate costs. Data for the Finishing department for September are as follows:

Units
Opening WIP inventory (30% complete)	983
Units started during the month	1,423
Closing WIP inventory	339
Costs	$
Direct materials costs in Opening WIP inventory	155,091
Conversion costs in Opening WIP inventory	97,153
Direct materials added to production during the month	231,607
Conversion costs added to production during the month	765,071

All direct materials are added at the beginning of the process, conversion costs are incurred evenly throughout the finishing department.

Calculate the number of units completed and transferred out of the Finishing department during the month.

Q.12 Cacophony Ltd manufactures custom-made computer equipment. The company applies manufacturing overhead to individual jobs using machine hours as a cost driver. The following costs were budgeted for the forthcoming year:

Direct material costs	$391,931
Direct labour costs	$225,805
Manufacturing overheads	$260,609
Number of machine hours	559,674

 

Job #996 has incurred direct materials of $1,880, direct labour of $864 and used 878 machine hours.

Calculate the total manufacturing costs for job #996. (Round your answer to the nearest dollar.)

Q.13 The following forecast information relates to operations of Zmart for the month of July and is based on expected production of 50,000 units for the month.

	$
Sales revenue	1,444,673
Manufacturing costs
Variable	580,625
Fixed	255,513
Selling costs
Variable	58,392
Fixed	49,912
Administrative costs
Variable	181,870
Fixed	114,140

 

Calculate how many units need to be sold in July in order to achieve a target operating profit of $250,000. (Round your final answer to the nearest whole number.)

Q.14 Cacophony Ltd manufactures custom-made computer equipment. The company applies manufacturing overhead to individual jobs using machine hours as a cost driver. The following costs were budgeted for the forthcoming year:

Direct material costs	$438,225
Direct labour costs	$161,094
Manufacturing overheads	$241,687
Number of machine hours	538,809

Job #998 has incurred direct materials of $1,614, direct labour of $985 and used 1,162 machine hours.

Calculate the annual manufacturing overhead allocation rate for Cacophony Ltd. (Round your answer to two decimal places.)

Q.15 A non-profit organisation provides meals to homeless people in Brisbane. Each year it incurs fixed costs of $282,330, and each meal costs $6. If the organisation receives funding of $482,280 for the year, how many meals can it provide?