Chapter 4 and 5 Problems

Please complete the following 7 exercises below in either Excel or a word document (but must be single document). You must show your work where appropriate (leaving the calculations within Excel cells is acceptable). Save the document, and submit it in the appropriate week using the Assignment Submission button.

Chapter 4 Exercise 3
3. Cost flows and overhead application
Cleveland Metals uses a job cost system and applies factory overhead to production at a predetermined rate of 180% of direct labor cost. Data pertaining to recent operations follow.
Job no. 636 was the only job in process on January 1 of the current year. The Work in Process account contained a $24,600 balance on this date.
Jobs no. …show more content…

a. Determine the variable cost per order shipped.

Orders Shipping Shipped Costs Highest activity (3rd quarter) 175 60125 Lowest activity (1st quarter) 120 58200 Difference 55 1925

b. Determine the fixed shipping costs per quarter.

High Point Low Point 175 orders 120 orders Total cost 60125 58200 less variable cost at $35 per order shipped 6125 4200 Fixed shipping cost 54000 54000

c. If present cost behavior patterns continue, determine total shipping costs for 19X7 if activity amounts to 570 orders.

Shipping costs for 570 orders: Variable cost (570 x $35) 19950 Fixed cost (54000 per quarter x 4) 216000 Total shipping costs 235950

Chapter 5 Exercise 2
The treasurer anticipates the following costs for the event, which will be held at the Regency Hotel:
Room rental $300
Dinner cost (per person) 25
Chartered buses 500
Favors and souvenirs (per person) 5
Band 900

Each person would pay $40 to attend; 200 attendees are expected.
a. Will the event be profitable for the sorority? Show computations.

Revenues(40 x 200) 8000 Fixed costs Room rental 300 Chartered buses