Ola Ltd, which uses a job costing system, had two jobs in process

Ola Ltd, which uses a job costing system, had two jobs in process at the start of the year: Job L1 ($68,000) and Job L2 ($30 000). The following information is available: i. The company applies manufacturing overhead on the basis of machine hours. Budgeted overhead and machine activity for the year were anticipated to be $1,000,000 and 25,000 hours, respectively. ii. The company worked on three jobs during the first quarter (i.e. from 1 January to 31 March). Direct materials used, direct labour incurred and machine hours consumed were as shown in the following table:   Job numbers Direct material Direct labour Machine hours L1 $15,000 $30,000    900 L2      – 33,000 1,600 L3 45,000 65,000 2,000    …

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Following information relate to Hawke Ltd

Following information relate to Hawke Ltd for the financial year ended 2020 Hawke Ltd Statement of Financial position As at 30 June 2020 2020 2019 Assets     Cash at bank 84200 100000 Accounts receivable 208000 172000 Inventory 200000 208000 Prepaid insurance 12000 20000 Interest receivable 400 600 Investments 80000 40000 Plant and equipment 800000 720000 Less: Accumulated depreciation -200000 -180000 Total assets 1184600 1080600 Liabilities     Accounts payable 152000 128000 Provision for employee benefits 24000 16000 Other expenses payable 8000 12000 Equity     Share capital 800000 800000 Retained earnings 200600 124600 Total liabilities and equity 1184600 1080600     Hawke Ltd Statement of Financial performance For the period ended 30 June 2020     2020 2019 Income  …

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You want to buy a property valued at $1,200,000 and have arranged

You want to buy a property valued at $1,200,000 and have arranged with the PB Bank for a 30 year mortgage equal to 90% of the sale price. The agreement calls for monthly repayments and the bank will charge 6% pa interest compounded monthly. If your first monthly payment is due one month after the loan is received, calculate the amount for your regular monthly payments. (Show answer correct to the nearer cent) After 5years (that is after the 60th payment) you want to refinance your mortgage with RH Bank. Assuming no exit fees, calculate the payout amount that is, the amount you have to pay PB bank to payout your mortgage. (Show answer correct to the nearer cent) The RH…

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CIMB Bank pays its clients 5% interest per annum

CIMB Bank pays its clients 5% interest per annum, compounded on a semi-annual basis. To remain competitive, the bank’s major competitor, May Bank is willing to match the interest rate offered by CIMB Bank, but interest will be compounded on a quarterly basis. What nominal rate of interest must May Bank offer to its clients? (Show answer correct to four decimal points)

You have just borrowed $10,000. You are required to repay

You have just borrowed $10,000. You are required to repay equal amounts at the end of each of 7 years, with the first payment starting in four years’ time. Your interest rate is 8% per annum. How much will be the amount of each payment? (Show answer correct to the nearer cent)

A manufacturing company Carolina Coffee, Inc. sells a single product

Given the information below, perform the following required tasks for Carolina Coffee, Inc.: Prepare a monthly master budget for Carolina Coffee, Inc. for the year ended December 31, 2021, including the following schedules: Sales Budget & Schedule of Cash Receipts, Production Budget, Direct Materials Budget & Schedule of Cash Disbursements, Direct Labor Budget, Manufacturing Overhead Budget, Ending Finished Goods Inventory Budget, Selling and Administrative Expense Budget, and Cash Budget. Prepare a budgeted income statement and a budgeted statement of retained earnings for the year ended December 31, 2021, using absorption costing. Prepare a budgeted balance sheet as of December 31, 2021. Prepare a budgeted income statement for the year ended December 31, 2021, using variable costing. Master Budget:   Carolina Coffee, Inc.…

Financial information for Thomas Ltd and its 100% owned subsidiary

Financial information for Thomas Ltd and its 100% owned subsidiary, Gordon Ltd, for the period ended 30 June 2025 is provided below.   Thomas Ltd ($) Gordon Ltd ($) Sales revenue 52500 49560 Dividend revenue 2080 0 Gain on sale of PPE 2060 4120 Other income 2040 4080 Total income 58680 57760 Cost of Sales 43260 37080 Other expenses 6240 2080 Total expenses 49500 39160 Profit before income tax 9180 18600 Income tax expense 2835 4095 Profit for the period 6345 14505 Retained earnings (1 July 2024) 12840 6420 19185 20925 Interim dividend paid 5200 2080 Retained earnings (30 June 2025) 13985 18845   Thomas Ltd acquired its shares in Gordon Ltd at 1 July 2024 for $40800 on a cum div.…

Bellroy Company makes protective cases

Bellroy Company makes protective cases for iPhone 11 Pro Max. The company has three product lines – Polycarbonate (PC) cases, Silicone (S) cases and Thermoplastic Polyurethane (TPU) case. The following table presents the sales and cost data of the business.     PC case   S case   TPU Case Selling Price per unit 50 65   90   Variable Cost Per unit 45 61   87   Company’s total fixed cost 35,100           After analysing the market trend, the management accountant of Bellroy Company expects that the company will be able to sell 17,500 cases in next month consisting, 2,500 units of PC case, 10,000 units of S case and 5,000 units of TPU case.  …

Cannondale Bicycle Company manufactures various lines of bicycles

Cannondale Bicycle Company manufactures various lines of bicycles. Because of the high volume of each type of product, the company employs a process cost system to determine unit costs. Bicycle parts are manufactured in the Moulding Department and transferred to the Assembly Department where they are assembled. After assembly, the bicycles are sent to the Packing Department. Cost and production figures for the Assembly Department are presented below for the month of June:   Production Data (in unit)   Beginning WIP Inventory (70% complete as to material; 40% complete as to conversion) 70,000 Started in June 460,000 Completed and transferred out 450,000 Ending WIP Inventory (75% complete as to material; 25% complete as to conversion) 80,000     Cost Data (in…

Computer Horizons Ltd. manufactures computers

Computer Horizons Ltd. manufactures computers. The company has two corporate support departments (legal and personnel) in supporting each other and two manufacturing departments, the Laptop department and the Workstation department.   The overhead costs of support departments are allocated to the manufacturing departments. Legal hours are used to allocate the cost of legal department, and personnel hours are used to allocate the cost of personnel department. The budgeted overhead costs and cost allocation bases are given below:   Support Departments Manufacturing Departments Legal Personnel Laptop Workstation Overhead Costs before any inter department cost allocations $9,055 $4,000 $240,000 $200,000 Support Work provided by Legal Department Legal hours 2 3 37 20 Support work provided by Personnel Department Personnel hours 40 30 200…

Money Ltd acquired equipment on 1 July 2021 at $105,000

Money Ltd acquired equipment on 1 July 2021 at $105,000. The equipment is depreciated using straight-line method and subsequently measured using the revaluation model. Money Ltd expects the equipment to have 7 years useful life and a zero residual value. The information below is available regarding the equipment in the following periods.   Date Fair Value Cost to Sell Value in Use 30 June 2023            $ 85,000 $ 2,000 $90,000 30 June 2025            $ 45,000 $ 3,000 $40,000   Required  Assuming indications of impairment exist on the dates above, please prepare the general journal entries (as per template below) to account for the equipment on the following dates: 30 June 2023 30 June 2025 General Journal Date Accounts Debit…

Glenelg Bay Ltd has a Cash-Generating Unit (CGU)

Glenelg Bay Ltd has a Cash-Generating Unit (CGU) comprised of assets as follows:

Asset	Carrying Amount
Inventory	15,000
Goodwill	30,000
Plant	80,000
Motor Vehicles	40,000

 

On 30 June 2020, Glenelg Bay performed an impairment test for this CGU and determined that the recoverable amount is $120,000.

Required  

1. Calculate the impairment loss as at 30 June 2020.
2. Prepare a table as provided below to allocate the above impairment loss:

ASSETS	Carrying amount	Proportion	Loss allocated	Adjusted carrying amount
Totals

 

(c) Prepare a general journal (as per template below) to record the above impairment loss for the year ended 30 June 2020. Include a narration.

 

General Journal
Date	Accounts	Debit	Credit