1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Sveta_85 [38]
3 years ago
13

Wallace Company provides the following data for next year: MonthBudgeted Sales January$ 120,000 February 108,000 March 132,000 A

pril 144,000 The gross profit rate is 35 % of sales. Inventory at the end of December is $ 21,600 and target ending inventory level are 20 % of next month's sales, stated at cost. What is the amount of purchases budget for January
Business
1 answer:
Ad libitum [116K]3 years ago
7 0

Answer:

$70440

Explanation:

Given data :

Month             Budgeted sales

January           $120,000

February         $108,000

March              $132,000

April                 $144,000

Gross profit rate = 35% of sales

Inventory at end of December = $21600

Target ending inventory level = 20% of next month sales

<u>Determine the amount of purchases budget for January</u>

First step : calculate

Cost of goods for January = Budgeted sales - Gross profit

= $120,000 - $42,000 =  $78000

Next : determine ending inventory in January

= 20% * ( Budgeted sales in Feb * 65% )

= 20% * ($108000 * 65%) = $14040

Determine budgeted purchase using the Relation below

Cost of goods sold = Beginning inventory + Budgeted purchases - Ending inventory

78,000 = 21600 + Budgeted purchases - 14040

therefore

Budgeted purchases for January = ( 78,000 + 14040 - 21600 )

                                                       = $70440

You might be interested in
Terrence Industries charges manufacturing overhead to products by using a predetermined application rate, computed on the basis
puteri [66]

Answer:

See below

Explanation:

First, we need to get the predetermined rate

Predetermined rate = Cost of manufacturing overhead / Cost driver

= $1,800,000/60,000

= $30

We will now calculate the application.

Actual labor hours × rate

= 61,500 × $30

= $1,845,000

We will now compare actual with overhead cost

= Applied Overhead cost - Actual manufacturing overhead

= $1,845,000 - $1,810,000

= $35,000

The above is an over application of overhead cost because the cost applied exceed the actual cost.

5 0
2 years ago
Delta Construction Corporation, a general contractor, hires Eagle Electrical Company, a subcontractor, to wire a new office buil
nignag [31]

Answer: excused by Delta's failure to pay.

Explanation:

Delta Construction Corporation hires Eagle Electrical Company, as a subcontractor, to wire its new office building. After the completion of the work, Eagles is owed more than $50000.

Eagle's suspension of work is most likely due to the excuse by Delta's failure to pay. Delta has a right to pay up the money owed to Eagle. Lack of payment can lead to court cases.

3 0
3 years ago
Spencer Inc. applies overhead to production at a predetermined rate of 80% based on direct labor cost. Job No. 130, the only job
Romashka [77]

Answer:

Direct material= $5,600

Explanation:

<u>First, we need to calculate the direct labor added to Work in Process:</u>

Direct labor= allocated overhead / predetermined overhead rate

Direct labor= 6,400 / 0.8

Direct labor= $8,000

<u>Now, by difference, the direct materials:</u>

Direct material= Ending balance - allocated overhead - direct labor

Direct material= 20,000 - 6,400 - 8,000

Direct material= $5,600

3 0
3 years ago
Indicate the proper accounting treatment for a change in the rate used to compute warranty costs.
Lana71 [14]

Answer:

a. Accounted for prospectively

Explanation:

Warranty cost is an expense i.e. to be incurred for the repair or replacement of the goods comes under the warranty given by the company.

Here if there is a change in the rate i.e. used for determining the warranty cost so it would be accounted in prospectively manner i.e. it would be changed in the current period and also the amount should be estimated or predicted

Hence, the correct option is a.

7 0
3 years ago
What guidance identifies federal security controls.
pantera1 [17]

The Federal Information Security Management Act of 2002 is the guidance that identifies federal security controls.

<h3>What is the The Federal Information Security Management Act of 2002?</h3>

This is also known as the FISMA 2002. This guideline requires federal agencies to doe the following:

  • To document
  • To implement
  • To develop

Agency programs nationwide that  would help to support the operations of the agency.

Read more on federal agencies here:

brainly.com/question/8109105

3 0
2 years ago
Other questions:
  • Amy owns a salon and spa. She’s leasing a prime piece of real estate in which she’s installing salon chairs, counters, massage t
    9·1 answer
  • you currently have $5600. First united bank will pay you an annual interest rate of 9.1, while second national bank will pay you
    13·1 answer
  • Amy agreed to a contract price of $100,000 for a home and secured a mortgage loan for $80,000. If the appraised value is $110,00
    15·1 answer
  • Patton Company purchased $1,500,000 of 10% bonds of Scott Company on January 1, 2021, paying $1,410,375. The bonds mature Januar
    15·1 answer
  • The cost of creating an email campaign for a product or a service is typically more expensive and takes longer to conduct than a
    8·1 answer
  • Metallica Bearings, Inc., is a young start-up company. No dividends will be paid on the stock over the next nine years, because
    6·1 answer
  • Bridgeport Company buys and sells securities expecting to make money on short-term price movements. Bridgeport purchased 150,000
    7·1 answer
  • If Modern Company received $3,650 from Connor Young Company on March 12 for the total amount of an account which had been writte
    12·1 answer
  • Which fact supports the idea that renting is a good
    10·1 answer
  • If demand for a good is inelastic, what would the demand curve for this good look like?
    6·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!