FOR SARAHMRKHAN ONLY Absolutely no plagarism – Report is run


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FOR SARAHMRKHAN ONLY Absolutely no plagarism – Report is run through TurnItIn SEE Attachment – Please provide valid links for references. Calculating Inventory Finlon Upholstery Inc. uses a job-order costing system to accumulate manufacturing costs. The company’s work-in-process on December 31, 2001, consisted of one job (no. 2077), which was carried on the year-end balance sheet at $156,800. There was no finished-goods inventory on this date. Finlon applies manufacturing overhead to production on the basis of direct-labor cost. (The budgeted direct-labor cost is the company’s practical capacity, in terms of direct-labor hours multiplied by the budgeted direct-labor rate.) Budgeted totals for 2002 for direct labor and manufacturing overhead are $4,200,000 and $5,460,000, respectively. Actual results for the year are as follows: Actual Results Direct Materials Used$5,600,000.00 Direct Labor$4,350,000.00 Indirect Material Used$65,000.00 Indirect Labor$2,860,000.00 Factory Depreciation$1,740,000.00 Factory Insurance$59,000.00 Factory Utilities$830,000.00 Selling and Administrative Expenses$2,160,000.00 Total$17,664,000.00 Job no. 2077 was completed in January 2002, and there was no work in process at year-end. All jobs produced during 2002 were sold with the exception of Job no. 2143, which contained direct-material costs of $156,000 and direct-labor charges of $85,000. The company charges any under- or over-applied overhead to the cost of goods sold category. Using the above information, do the following: Calculate the company’s predetermined overhead application rate. Calculate the additions to the work-in-process inventory account for the direct material used, direct labor, and manufacturing overhead. Calculate the finished-goods inventory for the 12/31/02 balance sheet. Calculate the over-applied or under-applied overhead at year-end. Explain if it is appropriate to include selling and administrative expenses in the cost of goods sold category. Perform and provide your calculations in an Excel spreadsheet . Copy the calculations into a Word document and Write a 1-page paper in Word format. Apply APA standards to citation of sources. MANAGERIALACCTMOD1.docx Cost Behavior Cost behavior is the volatility of product costs due to changes in production levels or sales volumes. Product costs include material costs, labor costs, and other overheads. Any change in the production levels and sales volumes can affect profitability. Here are some examples of how costs change: Variable costs change in proportion to total volume produced but remain the same on a per­unit basis. Fixed costs differ from variable costs in that they remain constant with change in volume produced but vary on a per­unit basis. Mixed costs are a combination of fixed and variable costs. Step costs vary over a wide range of activity levels but remain constant over a narrow range. In addition to these types of costs, here are some terms you will also learn: Contribution margin is the difference between the total sales and the total variable costs of an organization. Variable­costing statement presents the net income obtained by subtracting fixed expenses from the difference between total sales and total variable costs. Cost­volume­profit analysis determines the financial impact of the relationship between cost, volume, and profit. Break­even analysis determines whether or not total sales are equal to the total costs. A company reaches the break­even point when it is making neither a profit nor a loss. Variable costing is the unit cost of a product obtained by including both direct or variable costs and excluding fixed costs. Absorption costing is the unit cost of a product obtained by including the direct as well as indirect or fixed costs. In this module, you will become familiar with overall cost concepts, and analyze cost behavior within various costing systems. Methods for using costs in planning and budgeting decisions will

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