Identify the following characteristics as primarily related to financial accounting (FA) or managerial accounting (MA): 1. Helps creditors make lending decisions
The creditors are the party to whom the business owes money and the correct answer to this question is financial accounting.
The creditors are defined as the individual or business to whom the companies owe some amount of money.
The correct option is financial accounting
The appropriate accounting will be financial accounting as creditors require information about the company’s financial health and financial position. As this information will help the creditors to make lending decisions. All this information is provided in the financial statements which are prepared in the financial accounting.
Question: Calculating income and cost per unit for a merchandising company
Conway Brush Company sells standard hair brushes. The following information summarizes Conway’s operating activities for 2018:
Selling and Administrative Expenses $ 47,058
Net Sales Revenue 151,800
Merchandise Inventory, January 1, 2018 7,920
Merchandise Inventory, December 31, 2018 11,748
1. Calculate the operating income for 2018.
2. Conway sold 6,600 brushes in 2018. Compute the unit cost for one brush.
Identifying ethical standards
The Institute of Management Accountants’ Statement of Ethical Professional Practice requires managerial accountants to meet standards regarding competence, confidentiality, integrity, and credibility. Consider the following situations. Which standard(s) is(are) violated in each situation?
d. You failed to read the detailed specifications of a new accounting software package that you asked your company to purchase. After it is installed, you are surprised that it is incompatible with some of your company’s older accounting software.
Question: Preparing an income statement and calculating unit cost for a service company
The Windshield Doctors repair chips in car windshields. The company incurred the following operating costs for the month of March 2018:
Salaries and wages $ 12,000
Windshield repair materials 4,600
Depreciation on truck 300
Depreciation on building and equipment 1,200
Supplies used 300
The Windshield Doctors earned $23,000 in service revenues for the month of March by repairing 500 windshields. All costs shown are considered to be directly related to the repair service.
1. Prepare an income statement for the month of March.
2. Compute the cost per unit of repairing one windshield.
3. The manager of Windshield Doctors must keep unit operating cost below $50 per windshield in order to get his bonus. Did he meet the goal?
Computing cost of goods manufactured and cost of goods sold
Use the following information for a manufacturer to compute cost of goods manufactured and cost of goods sold:
Balances: Beginning Ending
Direct Materials $ 27,000 $ 28,000
Work-in-Process Inventory 40,000 32,000
Finished Goods Inventory 18,000 25,000
Purchases of direct materials $ 73,000
Direct labor 88,000
Manufacturing overhead 43,000
This is the first problem in a sequence of problems for Piedmont Computer Company, a manufacturer of personal computers and tablets. During its first month of manufacturing, Piedmont Computer Company incurred the following manufacturing costs:
Balances: Beginning Ending
Direct Materials $ 10,500 $ 9,700
Work-in-Process Inventory 0 17,000
Finished Goods Inventory 0 31,000
Direct materials purchases $ 16,000
Plant janitorial services 500
Sales salaries expense 10,000
Delivery expense 1,600
Sales revenue 1,100,000
Utilities for plant 16,000
Rent on plant 9,000
Customer service hotline costs 19,000
Direct labor 210,000
Prepare a schedule of cost of goods manufactured for Piedmont Computer Company for the month ended January 31, 2020.
94% of StudySmarter users get better grades.Sign up for free