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Management is considering discontinuing the Video Recorder product line. Accountants for the company estimate that discontinuing the Video Recorder line will decrease fixed cost of goods sold by $ 10,000 and fixed marketing and administrative expenses by $ 4,000. repare an analysis supporting your opinion about whether or not the Video Recorder product line should be discontinued.

================================================== ACCT 346 Week 6 Homework Assignment

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1. Cave Hardware ' s forecasted sales for April, May, June, and July are $ 200,000, $ 230,000, $ 190,000, and $ 240,000, respectively. Sales are 65 % cash and 35 % credit, with all accounts receivable collected in the month following the sale. Cost of goods sold is 75 % of sales and ending inventory is maintained at $ 60,000 plus 10 % of the following month ' s cost of goods sold. All inventory purchases are paid 22 % in the month of purchase and 78 % in the following month. What are the total cash collections budgeted for June?

2. Madden Corporation manufactures T-shirts( its only product). The company’ s standards for manufacturing T-shirts are as follows: 2a. What is the direct labor rate variance for the month? Is it favorable or unfavorable? 2b. What is the direct labor efficiency variance for the month? Is it favorable or unfavorable? ================================================== ACCT 346 Week 6 Quiz( 2 Sets)

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