Accounting Seminar Notes

Chapter 6 Homework Solutions 6-16 Sales budget, account setting. 1. Rouse & Sons| 2011 Volume| At 2011Selling Prices| Accepted 2012Change in Volume| Accepted 2012 Volume| Radon Tests| 12,200| $290| +6%| 12,932| Advance Tests| 16,400| $240| -10%| 14,760| Rouse & Sons Sales Budget| For the Year Ended December 31, 2012| |  |  |  | | Selling Price| Units Sold| Total Revenues| Radon Tests| $290| 12,932| $3,750,280| Advance Tests| $240| 14,760| 3,542,400| |  |  | $7,292,680| 2. Rouse & Sons| 2011 Volume| Planned 2012 Selling Prices| Accepted 2012 Change in Volume| Accepted 2012 Volume| Radon Tests| 12,200| $290| +6%| 12,932| Lead Tests| 16,400| $230| -7%| 15,252| Rouse & Sons Sales Budget| For the Year Ended December 31, 2012| |  |  |  | | Selling Price| Units Sold| Total Revenues| Radon Tests| $290| 12,932| $3,750,280| Advance Tests| $230| 15,252| 3,507,960| | | | $7,258,240| Accepted revenues at the new 2012 prices are $7,258,240, which is lower than the accepted 2012 revenues of $7,292,680 if the prices are unchanged. So, if the ambition is to aerate sales acquirement and if Jim Rouse’s forecasts are reliable, the aggregation should not lower its amount for a advance analysis in 2012. 6-17 Sales and assembly budget. Budgeted sales in units200,000 Add ambition catastrophe accomplished appurtenances account 25,000 Total requirements 225,000 Deduct alpha accomplished appurtenances account 15,000 Units to be produced 210,000 6-18Direct abstracts purchases budget. Absolute abstracts to be acclimated in assembly (bottles)2,500,000 Add ambition catastrophe absolute abstracts account (bottles) 80,000 Total requirements (bottles)2,580,000 Deduct alpha absolute abstracts account (bottles) 50,000 Absolute abstracts to be purchased (bottles)2,530,000 6-19 Budgeting actual purchases. Assembly Budget: Accomplished Appurtenances (units) Budgeted sales45,000 Add ambition catastrophe accomplished appurtenances inventory18,000 Total requirements63,000 Deduct alpha accomplished appurtenances inventory16,000 Units to be produced47,000 Absolute Abstracts Purchases Budget: Absolute Abstracts (in gallons) Absolute abstracts bare for assembly (47,000 3)141,000 Add ambition catastrophe absolute abstracts inventory50,000 Total requirements191,000 Deduct alpha absolute abstracts account 60,000 Absolute abstracts to be purchased 131,000 6-20Revenues and assembly budget. 1. | SellingPrice| UnitsSold| TotalRevenues| 12-ounce bottles| $0. 25| 4,800,000a| $1,200,000| 4-gallon units| 1. 50| 1,200,000b| 1,800,000| | | | $3,000,000| a 400,000 ? 12 months = 4,800,000 b 100,000 ? 2 months = 1,200,000 2. Budgeted assemblage sales (12-ounce bottles)4,800,000 Add ambition catastrophe accomplished appurtenances account 600,000 Total requirements5,400,000 Deduct alpha accomplished appurtenances account 900,000 Units to be produced4,500,000 3. = 1,200,000 + 200,000 1,300,000 = 100,000 4-gallon units 6-21 Budgeting: absolute actual usage, accomplishment amount and gross margin. 1. Absolute Actual Acceptance Account in Quantity and Dollars| | | |  | | Material|  | | Wool| Dye| Total| Physical Units Budget| | | | Absolute abstracts appropriate for| | |  | Blue Rugs (200,000 rugs ? 36 skeins and 0. 8 gal. )| 7,200,000 skeins | 160,000 gal.  | | | |  | Amount Budget| | | | Accessible from alpha absolute abstracts inventory: (a) | | |  | Wool: 458,000 skeins| $ 961,800| | | Dye: 4,000 gallons| | $ 23,680|  | To be purchased this period: (b)| | |  | Wool: (7,200,000 - 458,000) skeins ? $2 per skein| 13,484,000 | |  | Dye: (160,000 – 4,000) gal. ? $6 per gal. | _________| 936,000| | Absolute abstracts to be acclimated this period: (a) + (b)| $14,445,800 | $ 959,680| $15,405,480| 2. = = $2. 55 per DMLH = = $12 per MH 3. Budgeted Assemblage Amount of Blue Rug| | | | | | Amount perUnit of Input| Input perUnit ofOutput| Total| Wool| $2| 36 skeins| $ 72. 0| Dye| 6| 0. 8 gal. | 4. 80| Absolute accomplishment labor| 13| 62 hrs. | 806. 00| Dyeing overhead| 12| 7. 21 mach-hrs. | 86. 40| Weaving overhead| 2. 55| 62 DMLH| 158. 10| Total| | | $1127. 30| 10. 2 apparatus hour per skein36 skeins per rug = 7. 2 machine-hrs. per rug. 4. Acquirement Budget| | | |  | | Units| Selling Price| Total Revenues| Blue Rugs| 200,000| $2,000| $400,000,000| Blue Rugs| 185,000 | $2,000| $370,000,000| 5a. Sales = 200,000 rugs| Amount of Appurtenances Awash Budget| | |  | | From Schedule| Total| Alpha accomplished appurtenances inventory| | $ 0| Absolute abstracts used| $15,405,480|  | Direct accomplishment activity ($806 ? 200,000)| 161,200,000|  | Dyeing aerial ($86. 40 ? 200,000)| 17,280,000|  | Weaving aerial ($158. 10 ? 200,000)| 31,620,000| 225,505,480| Amount of appurtenances accessible for sale| | 225,505,480 | Deduct catastrophe accomplished appurtenances inventory| | 0 | Amount of appurtenances sold| | $225,505,480| | |  | 5b. Sales = 185,000 rugs| Amount of Appurtenances Awash Budget| | |  | | From Schedule| Total| Alpha accomplished appurtenances inventory| | $ 0| Absolute abstracts used| $ 15,405,480|  | Direct accomplishment activity ($806 ? 200,000)| 161,200,000|  | Dyeing aerial ($86. 40 ? 200,000)| 17,280,000|  | Weaving aerial ($158. 10 ? 200,000)| 31,620,000| 225,505,480| Amount of appurtenances accessible for sale| | 225,505,480 | Deduct catastrophe accomplished appurtenances account ($1,127. 30 ? 15,000)| | 16,909,500 | Amount of appurtenances sold| | $208,595,980| 6. | 200,000 rugs sold| 185,000 rugs sold| Revenue| $400,000,000| $370,000,000| Less: Amount of appurtenances sold| 225,505,480| 208,595,980| Gross margin| $ 174,494,520| $ 161,404,020|

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