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?