Question 1: Metropolitan Furniture                                                                        (10 mark)        Peter works in the accounts unit of the Metropolitan Furniture Manufacturing.  He was asked to prepare a proposed budget for the forthcoming quarter.  He consults with the sales manager and finds that:   Estimated sales are as follows: February $265,000 April $290,000 March $255,000 May $250,000 June $280,000 In consultation with the production manager he estimates that the cost of goods sold is to be budgeted at 45% of the sales figure.  The salaries are expected to be $65,000 per month. When sales exceed $260,000 in any one month, the sales team is entitled to an additional 5% commission on the excess sales over this figure. Other expenses are estimated to be $35,000…

Q1. Briefly describe who should be responsible for preparing an operating budget and why. Q2. a) The Vice President of the Plastics Division of Vandelay Industries prepared a budget for the current period.  Volume and cost data for the budget are provided at left along with actual volume and cost data for the period. Compute the master budget, the sales volume, and the selling price (flexible budget) variances for the Plastics Division's revenues for the current period. Show your work. Interpret what the sales volume variance tells management. Vandelay Industries Actual Budget Volume 11,000 10,500 Revenues per unit $667.25 $675.00 Direct materials per unit $134.50 $132.40 Direct labor per unit $105.75 $109.50 Other variable costs per unit $63.00 $62.25 Total fixed…

You work as a Manager for Happy Kids Ltd, a company that manufactures toys, infant products and electronic games. These products are sold through sub-contracted Sales Agents, who currently earn a commission of 17% on sales. The following is the most recent set of Management Accounts you have received from the Accountant: INCOME STATEMENT for the year ended 30 June 2016 Sales $ 36,000,000 Cost of goods sold $ 17,910,000 Variable $ 12,300,000 Fixed $     5,610,000 GROSS PROFIT $ 18,090,000 Selling and admin costs $ 10,245,000 Variable sales commissions $     6,120,000 Fixed advertising costs $        900,000 Fixed admin costs $     3,225,000 OPERATING INCOME $     7,845,000 Fixed interest expenses $     1,200,000 PROFIT BEFORE TAX $     6,645,000 Income tax $     1,777,500 NET PROFIT…

1.Joe Edmonds, CPA, was retained by Fox Cable to prepare financial statements for April 2012. Edmonds accumulated all the ledger balances per Fox’s records and found the following. FOX CABLE Trial Balance 30 April 2012 Dr.       Cr. Cash    $4,200 Accounts Receivable   3,300 Supplies           900 Equipment       10,700 Accumulated Depreciation                $1,450 Accounts Payable                   2,200 Salaries Payable                     710 Unearned Revenue                990 Manion, Capital 13,000 Service Revenue                    5,550 Salaries Expense         3,400 Advertising Expense    610 Miscellaneous Expense           290 Depreciation Expense 500         $23,900   $23,900   Joe Edmonds reviewed the records and found the following errors.   Cash received from a customer on account was recorded as $840 instead of $480.   A payment of $75 for advertising…

Group Accounting –  Consolidation   On 1 July 2016, ASD Ltd purchased 80% of EPY Ltd’s shares for $1,300,000 cash. On that day, the equity of EPY Ltd was: Share capital                           $700,000 Retained earnings                     500,000 $1,200,000 At the time of acquisition, EPY Ltd recorded all its assets at their fair values except for an item of plant and some land. ASD Ltd considered that an item of plant shown in the accounts of EPY Ltd was less than the fair value. The fair value should be 80,000 not 62,000 as shown in EPY Ltd's accounts. The plant was assessed to have a remaining useful life of 5 years and was to be depreciated on a straight-line basis.  The land was recorded…

You are required to complete each of two questions below. Provide detailed solutions and ensure that you include any relevant calculations. You should submit your assignment to Moodle using a single file; it can be Excel format, Word format or PDF format. There is no specified word limits. Any references included should use APA style. Question 1 (20 marks), Question 2 (10 Marks), John Pty Ltd is an Australian diversified industrial company with its major business activity being to manufacture flotation devices for babies and toddlers. Over the past decade, the business has been very profitable and the directors, Simon and Lisa, have kept payment of dividends to a minimum to allow the company to diversify into other activities. The following…

Business combination valuation entries, pre-acquisition entries   On 1 July 2016, Merelyn Ltd acquired all the issued shares of Cathy Ltd for $220 800. At this date the equity of Cathy Ltd consisted of share capital of $100 000 and retained earnings of $58 800. All the identifiable assets and liabilities of Cathy Ltd were recorded at amounts equal to fair value except for:                                                               Carrying amount                    Fair value Patent                                                  $70 000                                               $72 000 Plant (net of $40 000 depreciation)    40 000                                     60 000 Inventory                                            21 600                                     28 000      The patent was considered to have an indefinite life. It was calculated that the plant had a further life of 10 years, and was depreciated on a…

CHARLES DARWIN ...UNIVERSITY Part A: 1 Question Question 1 (80 Marks) McDonalds Limited Balance Sheet as at 1 July 2015 Assets Liabilities Current Assets Current Liabilities Cash 43900 Accounts Payable 28600 Accounts Receivable 27800 Accrues salaries 7100 Inventory 17500 Total current liabilities 35700 Prepaid Rent 6000 Total Current Assets 95200 Non-current liabilities Long term loan 75000 Total Liabilities 110700 Non-Current Assets Plant and Equipment 275000 Shareholder's equity Accumulated depreciation -65000 Share capital 150000 Investment 20000 Retained profits 64500 Total non-current assets 230000 Total shareholder's equity 214500 Total Assets 325200 Total Liabilities and shareholder's equity 325200   The following transactions occurred for McDonalds Ltd for the year ending 30 June 2016: Issued additional share capital for $5000 cash Received $26 800 from…