ACCT 556 Week 4 Homework Problems
The Hale Company uses a modified allocation method for allocating overhead costs . The rates that will be used in the coming year are as follows :
Required : Prepare the following production budgets for July , August , and September for the Hale Company : 1 . Production budget 2 . Materials purchase budget 3 . Direct labor budget 4 . Overhead budget For the quarter ( quarter totals only ), prepare the : 5 . Cost of goods manufactured budget ================================================
ACCT 556 Week 4 Homework Problems
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Week 4 Capital Budgeting Practice problem :
You have the following data about a proposed project : Cost of new equipment $ 80,000 Increase need for Working Capital ( to be released at end of project ) $ 20,000 Length of project 6 years Salvage Value of equipment at end of project $ 8,000 Annual cash savings if equipment is purchased ( cash inflows ) $ 28,500 Tax rate 35 % Discount rate required of all investements 14 %
Required : 1 . What is the annual accounting income ?