I need help with a Accounting question. All explanations and answers will be used to help me learn.
1- What Is the Difference Between Single and Dual-Rate Allocations? And write pros and cons of dual
rate allocation
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2- What are the methods of allocating joint costs?
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3- Abdullah Motors manufactures cars and currently uses only 50% of its manufacturing facility
(20,000 cars). The company could utilize more of its facility by producing its
own tires and using the total capacity. It currently purchases tires at $30
per unit. Abdullah would incur $12 per unit for direct materials, $10 for
direct labor, and $24 for overhead (which is 30% variable) if it produces
the tires.
a. Should Abdullah Motors make or buy the tires? Provide calculations
that support your answer.
b. Suppose Abdullah Motors could rent the unused portion of its plant
and receive $1,500 a month. Should the company make or buy the tires?
Provide calculations that support your answer
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4- Breakfast Bars has two support departments, Information Systems and Personnel. The
Information Systems Department costs of $120,000 are allocated on the basis of
hours used. The Personnel Department costs of $30,000 are allocated based on
the number of employees. Costs of the two operating departments are $60,000 for
Fruit Bars and $90,000 for Nut Bars. Data on information systems hours used
and number of employees are as follows:
Information
Allocation Bases: Systems Personnel Fruit
Nut
Information sy stems hours used 600 600 720 480
Number of employees 10 20 40 120
What is the cost of the Information Systems Department allocated to Fruit
using the direct method?
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5- The total cost to produce 10,000 units is SAR 880000, and the total cost to produce 15,000 units is
SAR 1,260000.
Required:
a. Develop a cost function for this cost.
b. Estimate the total cost to produce 18,000 units.
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6- Ahmad Division had the following information.
Operating income $ 50,000
Adjusted after-tax operating income 35,000
Adjusted total assets 80,000
Average operating assets 90,000
Current liabilities 15,000
Revenue 120,000
Weighted average cost of capital 10%
from the list calculate:
a. return on investment
b. residual income
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7- Here is information for Mohammed Manufacturing
Actual direct labor hours worked 20,000
Standard direct labor hours for units produced 2 2,000
Actual variable overhead costs incurred $24,000
Variable overhead efficiency variance $2,500 favorable
Standard variable overhead allocation rate per direct labor hou r $1.25
find:
A. Variable overhead spending variance
B. Variable overhead allocated
C. Actual variable overhead per direct labor hour
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8- Abdulrahman Company is developing a cost function for its total costs using the high-low method.
The following data have been collected for the past year:
Number of
units produced
Quarter Total Costs
1 5,000 SAR 850
2 6,500 925
3 7,000 950
4 8,000 1,000
Calculate the following amounts:
a. The variable cost per unit
b. The fixed cost
c. The estimated total cost for 9,000 units
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