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Template: Process Costing - Weighted average Check Cheap Shades inc is a retail business that sells a single product (knockoff sunglasseel. The company's revenues and expenses for the last 3 years are given below: Required: a. Based on cost behaviour experienced in prior 3 years above, identify which expenses are variable, which expenses are fixed and which expenses are mixed (use the chart below). [4.5 marks) b. For those expenses listed above that you identified as mined, separate each mised expense into its variable and fixed components using the highlow method and state the cost formula for each mied eppense. (3 marks) c. Assume that for 2023 sales are projected to be 461.000 units Create a contribution margin income statement for 2023 assuming cost behaviour istertified in a. and b. will not change in 2023, (3.5 marks) Gladys Leggrong, a retired avox extreme sports competitor, started Danoing Bike Compary loaCla bicyde manutacturing business last year. Her trat year's cortenibution format inoome statement looked like ths: NoTE. If the data above is blank it means you haven't entered your student mmber on the Cover tab. The average price DOC changed foe the sodotures was $550 per plece and DaCs income tas rate is 25. Requlred: Mease antwer the following 5 questions laing the data above. Thave lef apace ater tach quatstion for your to do your work. 1 you need more sppee you can ineert a row. Pledse do not use column A as I would like to une it to record my marking: 1 What is Dacis break even poirt in dollars? [3 marks] 2 What it Dac's martin of safety in unts? (2 marks) 3 Decis goal for year two is to earn an ater tax prott of 5 15.000 NotL. It there is ex mamber in the bea to t Assumine the cont behaviou is comstent wath what was experienoed in the frat year, the average aeling price is atill $300 a pitce and the tax tate remuire the same what would be the total units sold need so be to actieve the geal? (2 martu) 6. If Dec increases sales in year 2 by 15x tron year 1 sales, by what percentage thould operating proft increase byl? assunire cost behaviose ard average selitid priet stays the samel? Question 3 - Workers Wood Products (12 marks) Workers Wood Products Ltd (WWP) is a small custom wood working business located just cutside of Londan, Ontaria WWP uses a job-: order costing system to keep track of the costs for all of its jobs. At the beginaing of the year, the proprietor, Troy Polamalu, estimated that kis manufacturirg overhead was going to be $185,000 for the year. Because the largest percentage of costs were raw materials, manufacturing overhead was applied based on the cost of raw materials. Total raw materials for the year was expected to be $223,330. The following was the only production data recorded for September. Job Tab16 was finished during the month and delivered to the customer (sold) before the end of September. Jobs Hut 32 and Bar 19 were not yet complete at the end of September. Job Tab15 was finished at the end at September but had not yet been invciced or delivered to the astamer prior to month end. Required: Please answer the following 4 questions using the data above. I have left space after each question for your to do your work. If you need more space you can irsert rows. Please do not wse column A as I would like to use it to record my marking. 1 What was the predetermined overhead rate to be used to apply manufacturing overhead to jobs? (2 marks) 2 What is the Woek tn Process imventory balance at the end of September? (4 marks) 3 Actual overhead incurred in Sept. was 510,520NotE:IfthereisnonumberintheboxtotheleftitmeansyouhavententeredyourstudentmumberontheCovertab. What was the over/underapplied overhead? (2 marks) 4 It 56,450 was the costs for a Job Bar 18 (invoiced in September) that was in Finished coods inventary at the beginning of September: a) What was cost of goods sold for the month of September? WWP doses out its over/under applied overhead to cost of goods sold. (3 marks) b) what is the balance in Finkhed Goods linventory at the end of September? (1 mark) Question 4 - Pura Vida Company ( 10 marks) Pura Vida Company manufactures a product that only has one production process. Direct materials are added at the beginning of the manufacturing process and no units are lost/wasted during production. Pura Vida uses the weighted average cost method in its process costing system. Here Is some additional data about Pura Vida Company's Work In Process (WIP) inventory: \begin{tabular}{|l|rr|} \hline January 1st units in WIP & 182,000 \\ \hline \% complete conversion opening WIP & 75% \\ \hline Material costs in opening WIP & $ & 182,169 \\ \hline Conversion costs in opening WIP & $ & 227,711 \\ \hline Units started during January & 911,000 \\ \hline Units completed and transferred to Finished Goods Inventory in January & & 774,000 \\ \hline Direct material cost added during month & $ & 910,844 \\ \hline Conversion costs added during month & $ & 1,184,097 \\ \hline% complete conversion ending WIP & 50% \\ \hline \end{tabular} NOTE: If the data above is blank it means you haven't entered your student number on the Cover tab. Required: Please answer the following 3 questions using the data above. I have left space after each question for your to do your work. The production report template that we used in dass has been provided as an additional tab. If you need more space you can insert a row. Please do not use column A as I would like to use it to record my marking. 1 Compute the equivalent units of production and the cost per equivalent unit for materials and for conversion costs. (6 marks) 2 Determine the costs to be transferred from the work in process inventory account to finished goods . (1 mark) 3 Determine the amount of cost that should be assigned to the ending work in process inventory. (1 mark) Template: Process Costing - Weighted average Check Template: Process Costing - Weighted average Check Cheap Shades inc is a retail business that sells a single product (knockoff sunglasseel. The company's revenues and expenses for the last 3 years are given below: Required: a. Based on cost behaviour experienced in prior 3 years above, identify which expenses are variable, which expenses are fixed and which expenses are mixed (use the chart below). [4.5 marks) b. For those expenses listed above that you identified as mined, separate each mised expense into its variable and fixed components using the highlow method and state the cost formula for each mied eppense. (3 marks) c. Assume that for 2023 sales are projected to be 461.000 units Create a contribution margin income statement for 2023 assuming cost behaviour istertified in a. and b. will not change in 2023, (3.5 marks) Gladys Leggrong, a retired avox extreme sports competitor, started Danoing Bike Compary loaCla bicyde manutacturing business last year. Her trat year's cortenibution format inoome statement looked like ths: NoTE. If the data above is blank it means you haven't entered your student mmber on the Cover tab. The average price DOC changed foe the sodotures was $550 per plece and DaCs income tas rate is 25. Requlred: Mease antwer the following 5 questions laing the data above. Thave lef apace ater tach quatstion for your to do your work. 1 you need more sppee you can ineert a row. Pledse do not use column A as I would like to une it to record my marking: 1 What is Dacis break even poirt in dollars? [3 marks] 2 What it Dac's martin of safety in unts? (2 marks) 3 Decis goal for year two is to earn an ater tax prott of 5 15.000 NotL. It there is ex mamber in the bea to t Assumine the cont behaviou is comstent wath what was experienoed in the frat year, the average aeling price is atill $300 a pitce and the tax tate remuire the same what would be the total units sold need so be to actieve the geal? (2 martu) 6. If Dec increases sales in year 2 by 15x tron year 1 sales, by what percentage thould operating proft increase byl? assunire cost behaviose ard average selitid priet stays the samel? Question 3 - Workers Wood Products (12 marks) Workers Wood Products Ltd (WWP) is a small custom wood working business located just cutside of Londan, Ontaria WWP uses a job-: order costing system to keep track of the costs for all of its jobs. At the beginaing of the year, the proprietor, Troy Polamalu, estimated that kis manufacturirg overhead was going to be $185,000 for the year. Because the largest percentage of costs were raw materials, manufacturing overhead was applied based on the cost of raw materials. Total raw materials for the year was expected to be $223,330. The following was the only production data recorded for September. Job Tab16 was finished during the month and delivered to the customer (sold) before the end of September. Jobs Hut 32 and Bar 19 were not yet complete at the end of September. Job Tab15 was finished at the end at September but had not yet been invciced or delivered to the astamer prior to month end. Required: Please answer the following 4 questions using the data above. I have left space after each question for your to do your work. If you need more space you can irsert rows. Please do not wse column A as I would like to use it to record my marking. 1 What was the predetermined overhead rate to be used to apply manufacturing overhead to jobs? (2 marks) 2 What is the Woek tn Process imventory balance at the end of September? (4 marks) 3 Actual overhead incurred in Sept. was 510,520NotE:IfthereisnonumberintheboxtotheleftitmeansyouhavententeredyourstudentmumberontheCovertab. What was the over/underapplied overhead? (2 marks) 4 It 56,450 was the costs for a Job Bar 18 (invoiced in September) that was in Finished coods inventary at the beginning of September: a) What was cost of goods sold for the month of September? WWP doses out its over/under applied overhead to cost of goods sold. (3 marks) b) what is the balance in Finkhed Goods linventory at the end of September? (1 mark) Question 4 - Pura Vida Company ( 10 marks) Pura Vida Company manufactures a product that only has one production process. Direct materials are added at the beginning of the manufacturing process and no units are lost/wasted during production. Pura Vida uses the weighted average cost method in its process costing system. Here Is some additional data about Pura Vida Company's Work In Process (WIP) inventory: \begin{tabular}{|l|rr|} \hline January 1st units in WIP & 182,000 \\ \hline \% complete conversion opening WIP & 75% \\ \hline Material costs in opening WIP & $ & 182,169 \\ \hline Conversion costs in opening WIP & $ & 227,711 \\ \hline Units started during January & 911,000 \\ \hline Units completed and transferred to Finished Goods Inventory in January & & 774,000 \\ \hline Direct material cost added during month & $ & 910,844 \\ \hline Conversion costs added during month & $ & 1,184,097 \\ \hline% complete conversion ending WIP & 50% \\ \hline \end{tabular} NOTE: If the data above is blank it means you haven't entered your student number on the Cover tab. Required: Please answer the following 3 questions using the data above. I have left space after each question for your to do your work. The production report template that we used in dass has been provided as an additional tab. If you need more space you can insert a row. Please do not use column A as I would like to use it to record my marking. 1 Compute the equivalent units of production and the cost per equivalent unit for materials and for conversion costs. (6 marks) 2 Determine the costs to be transferred from the work in process inventory account to finished goods . (1 mark) 3 Determine the amount of cost that should be assigned to the ending work in process inventory. (1 mark) Template: Process Costing - Weighted average Check

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