Exercise 18-7 Balance sheet identification and preparation L.O. C4

Exercise 18-7 Balance sheet identification and preparation L.O. C4

[The following information applies to the questions displayed below.]

Current assets for two different companies at calendar year-end 2011 are listed here. One is a manufacturer, Roller Blades Mfg., and the other, Sunny Foods, is a grocery distribution company.

Account	Company 1	Company 2
Cash	$	9,000			$	7,000
Raw materials inventory		—				46,750
Merchandise inventory		49,750				—
Goods in process inventory		—				34,000
Finished goods inventory		—				54,000
Accounts receivable, net		59,000				81,000
Prepaid expenses		2,500				500

Section Break	Difficulty: Hard
Exercise 18-7 Balance sheet identification and preparation L.O. C4	Learning Objective: 18-C4 Explain how balance sheets and income statements for manufacturing and merchandising companies differ.

1.

award:
1 out of
1.00 point

Exercise 18-7 Part 1.1

(1.1)

Identify which set of numbers relates to the manufacturer.

	Company 1
	Company 2

Company 2, Roller Blades Mfg., is a manufacturing company with 3 inventory categories (raw materials, goods in process, and finished goods).

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Multiple Choice	Difficulty: Hard
Exercise 18-7 Part 1.1	Learning Objective: 18-C4 Explain how balance sheets and income statements for manufacturing and merchandising companies differ.

2.

award:
1 out of
1.00 point

Exercise 18-7 Part 1.2

(1.2)

Identify which set of numbers relates to the merchandiser.

	Company 1
	Company 2

Company 1, Sunny Foods, is a merchandising firm with only one inventory item, merchandise inventory.

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Multiple Choice	Difficulty: Hard
Exercise 18-7 Part 1.2	Learning Objective: 18-C4 Explain how balance sheets and income statements for manufacturing and merchandising companies differ.

3.

award:
2 out of
2.00 points

Exercise 18-7 Part 2

(2)	Prepare the current asset section for each company from this information. (Be sure to list the current assets in order of liquidity. Omit the “$” sign in your response.)

Company 1 Sunny Foods Current Asset Section December 31, 2011
Cash	$ 9,000
Accounts receivable, net	59,000
Merchandise inventory	49,750
Prepaid expenses	2,500
Total current assets	$ 120,250

Company 2 Roller Blades Mfg. Current Asset Section December 31, 2011
Cash	$ 7,000
Accounts receivable, net	81,000
Raw materials inventory
Goods in process inventory
Finished goods inventory
Prepaid expenses	500
Total current assets	$ 223,250

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Worksheet	Difficulty: Hard
Exercise 18-7 Part 2	Learning Objective: 18-C4 Explain how balance sheets and income statements for manufacturing and merchandising companies differ.

4.

award:
2 out of
2.00 points

Exercise 18-8 Cost of goods sold computation L.O. P1

	Century Merchandising		New Homes Manufacturing
Beginning inventory
Merchandise		$	263,000
Finished goods						$	526,000
Cost of purchases			500,000
Cost of goods manufactured							930,000
Ending inventory
Merchandise			163,000
Finished goods							157,000

Compute cost of goods sold for each of these two companies for the year ended December 31, 2011. (Omit the “$” sign in your response.)

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Worksheet	Difficulty: Medium
Exercise 18-8 Cost of goods sold computation L.O. P1	Learning Objective: 18-P1 Compute cost of goods sold for a manufacturer.

7. award: 3 out of 3.00 points Exercise 18-11 Manufacturing statement preparation L.O. P2 Given the following selected account balances of Randa Company. Sales $ 1,459,000 Raw materials inventory, Dec. 31, 2010 42,000 Goods in process inventory, Dec. 31, 2010 56,300 Finished goods inventory, Dec. 31, 2010 61,100 Raw materials purchases 175,700 Direct labor 246,000 Factory computer supplies used 24,700 Indirect labor 55,000 Repairs—Factory equipment 7,250 Rent cost of factory building 50,000 Advertising expense 81,000 General and administrative expenses 140,000 Raw materials inventory, Dec. 31, 2011 49,900 Goods in process inventory, Dec. 31, 2011 40,000 Finished goods inventory, Dec. 31, 2011 65,300 Prepare its manufacturing statement for the year ended on December 31, 2011. (Input all amounts as positive values. Omit the “$” sign in your response.) Exercise 18-9 Cost of goods manufactured and cost of goods sold computation L.O. P1, P2 [The following information applies to the questions displayed below.] Using the following data, Canyon Company Rossings Company Beginning finished goods inventory $ 12,000 $ 14,500 Beginning goods in process inventory 16,500 19,500 Beginning raw materials inventory 13,500 10,000 Rental cost on factory equipment 29,000 23,000 Direct labor 22,000 42,000 Ending finished goods inventory 21,500 12,500 Ending goods in process inventory 27,000 21,000 Ending raw materials inventory 7,700 17,200 Factory utilities 10,000 10,000 Factory supplies used 10,000 9,100 General and administrative expenses 18,000 55,000 Indirect labor 3,250 9,660 Repairs—Factory equipment 6,780 3,500 Raw materials purchases 34,000 41,000 Sales salaries 57,000 47,000 Section Break Exercise 18-9 Cost of goods manufactured and cost of goods sold computation L.O. P1, P2 Learning Objective: 18-P2 Prepare a manufacturing statement and explain its purpose and links to financial statements. 5. award: 2 out of 2.00 points Exercise 18-9 Part 1 1. Compute the cost of goods manufactured for both Canyon Company and Rossings Company. (Omit the “$” sign in your response.) eBook Links (2)View Hint #1 Worksheet Difficulty: Medium Learning Objective: 18-P2 Prepare a manufacturing statement and explain its purpose and links to financial statements. Exercise 18-9 Part 1 Learning Objective: 18-P1 Compute cost of goods sold for a manufacturer. 6. award: 0 out of 2.00 points Exercise 18-9 Part 2 2. Compute cost of goods sold for both Canyon Company and Rossings Company. (Omit the “$” sign in your response.) eBook Links (2)View Hint #1 Worksheet Difficulty: Medium Learning Objective: 18-P2 Prepare a manufacturing statement and explain its purpose and links to financial statements. Exercise 18-9 Part 2 Learning Objective: 18-P1 Compute cost of goods sold for a manufacturer.

Section Break

Exercise 18-9 Cost of goods manufactured and cost of goods sold computation L.O. P1, P2

Learning Objective: 18-P2 Prepare a manufacturing statement and explain its purpose and links to financial statements.

1.

Exercise 18-9 Part 2

2.

7.

award:
3 out of
3.00 points

Exercise 18-11 Manufacturing statement preparation L.O. P2

Given the following selected account balances of Randa Company.

Sales	$	1,459,000
Raw materials inventory, Dec. 31, 2010		42,000
Goods in process inventory, Dec. 31, 2010		56,300
Finished goods inventory, Dec. 31, 2010		61,100
Raw materials purchases		175,700
Direct labor		246,000
Factory computer supplies used		24,700
Indirect labor		55,000
Repairs—Factory equipment		7,250
Rent cost of factory building		50,000
Advertising expense		81,000
General and administrative expenses		140,000
Raw materials inventory, Dec. 31, 2011		49,900
Goods in process inventory, Dec. 31, 2011		40,000
Finished goods inventory, Dec. 31, 2011		65,300

Prepare its manufacturing statement for the year ended on December 31, 2011. (Input all amounts as positive values. Omit the “$” sign in your response.)

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Worksheet	Difficulty: Hard
Exercise 18-11 Manufacturing statement preparation L.O. P2	Learning Objective: 18-P2 Prepare a manufacturing statement and explain its purpose and links to financial statements.

8.

award:
2 out of
2.00 points

Exercise 18-12 Income statement preparation L.O. P2

Following are the selected account balances of Randa Company:

Sales	$	1,491,000
Raw materials inventory, Dec. 31, 2010		37,000
Goods in process inventory, Dec. 31, 2010		59,600
Finished goods inventory, Dec. 31, 2010		61,100
Raw materials purchases		172,200
Direct labor		232,000
Factory computer supplies used		19,100
Indirect labor		52,000
Repairs—Factory equipment		7,250
Rent cost of factory building		55,000
Advertising expense		94,000
General and administrative expenses		132,000
Raw materials inventory, Dec. 31, 2011		49,000
Goods in process inventory, Dec. 31, 2011		46,500
Finished goods inventory, Dec. 31, 2011		71,300

Prepare an income statement for Randa Company (a manufacturer). Assume that its cost of goods manufactured is $538,650. (Input all amounts as positive values. Omit the “$” sign in your response.)

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Worksheet	Difficulty: Hard
Exercise 18-12 Income statement preparation L.O. P2	Learning Objective: 18-P2 Prepare a manufacturing statement and explain its purpose and links to financial statements.

9.

award:
2 out of
2.00 points

Exercise 18-13 Cost flows in manufacturing L.O. C5

The following chart shows how costs flow through a business as a product is manufactured. Some boxes in the flowchart show cost amounts. Compute the cost amounts for the input boxes.