Solutions ACC 106 APFR EX2

School: Wilson College - Course: ACCOUNTING 106 - Subject: Accounting

Problem 1 Variable cost =$146,520/8,800 = $16.65/unit A$16.65/ unit x activity level 8,900 units$148,185 Total Variable Cost BFixed Cost $219,296 CTotal $367,481 DVariable Cost per Unit$16.65/unit EFixed Cost per unit = $219,296/8,90024.64/unit FTotal Cost/Unit$41.29 Problem 2Big Adventure Corporation Product & Period Costs A total Product Costs: Direct Materials, Direct Labor, Manufacturing Overhead Direct Materials $195,000 Direct Labor105,000 Manufacturing Overhead: Factory Utilities9,000 Indirect Labor30,000 Depreciation - Factory28,000 Total Manufacturing Overhead67,0009000+30,000 Total Product Costs$367,000 195,000+105 BPeriod Costs: Sales Commissons$75,000 Administrative Salaries113,000 Advertising119,000 Depreciation - Administrative Equipment44,000$351,000 Total Period Costs$351,000 Problem #3Journal Entries - Lone Rebel CompanyDebitCredit Transaction a Raw Materials Inventory96,000 Accounts Payable96,000 bWork in Process 88,000 Raw Materials Inventory88,000

cManufacturing Overhead17,000 Accounts Payable17,000 dWork in Process174,000 Manufacturing Overhead70,000 Salaries Expense124,000 Salaries &Wages Payable368,000 eManufacturing Overhead12,000 Accounts Payable12,000 fAdvertising Expense 98,000 Accounts Payable98,000 gManufacturing Overhead (75%x75,000)56,250 Depreciation Exp - Administrative - 25%18,75075000*25% Accumulated Depreciation75,000 hManufacturing Overhead - 80% x $80,00064,000 Rent Expense - Administrative16,00080000*25% Accounts Payable80,000 iMiscellaneous Expense 12,000 Accounts Payable12,000 jWork in Process105,600(186,000/155 Manufacturing Overhead 105,600 kFinished Goods 480,000 Work in Process480,000 lAccounts Receivable900,000 Sales Revenue900,000 Cost of Goods Sold550,000 Finished Goods 550,000