ACC 206 Week 2 Assignment Chapter 2 and 3 Problems and Exercises, DQs - College Helpers

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Chapter Two and Three Problems Please complete the following 7 exercises below in either Excel or a word document (but must be single document). You must show your work where appropriate (leaving the calculations within Excel cells is acceptable). Save the document, and submit it in the appropriate week using the Assignment Submission button. Chapter 2 Exercise 1 1. Issuance of stockPrepare journal entries to record the issuance of 100,000 shares of common stock at $20 per share for each of the following independent cases:a. Jackson Corporation has common stock with a par value of $1 per share.b. Royal Corporation has no-par common with a stated value of $5 D share.c. French Corporation has no-par common; no stated value has been as signed Chapter 2 Exercise 3 3. Analysis of stockholders’ equityStar Corporation issued both common and preferred stock during 19X6. The stockholders’ equity sections of the company’s balance sheets at the end of 19X6 and 19X5 follow.

	19X6	19X5
Preferred stock, $100 par value, 10%	$580,000	$500,000
Common stock, $10 par value	2,350,000	1,750,000

Paid-in capital in excess of par value
Preferred	24,000	—
Common	4,620,000	3,600,000
Retained earnings	8,470,000	6,920,000
Total stockholders’ equity	$16,044,000	$12,770,000

a. Compute the number of preferred shares that were issued during 19X6.b. Calculate the average issue price of the common stock sold in 19X6.c. By what amount did the company’s paid-in capital increase during 19X6?d. Did Star’s total legal capital increase or decrease during 19X6? By what amount? Chapter 2 Problem 11. Bond computations: Straight-line amortizationSouthlake Corporation issued $900,000 of 8% bonds on March 1, 19X1. The bonds pay interest on March 1 and September 1 and mature in 10 years. Assume the independent cases that follow.· Case A—The bonds are issued at 100.· Case B—The bonds are issued at 96.· Case C—The bonds are issued at 105. Southlake uses the straight-line method of amortization. Instructions:

Complete the following table:
	Case A	Case B	Case C
Cash inflow on the issuance date	_______	_______	_______
Total cash outflow through maturity	_______	_______	_______
Total borrowing cost over the life of the bond issue	_______	_______	_______
Interest expense for the year ended December 31, 19X1	_______	_______	_______
Amortization for the year ended December 31, 19X1	_______	_______	_______
Unamortized premium as of December 31, 19X1	_______	_______	_______
Unamortized discount as of December 31, 19X1	_______	_______	_______
Bond carrying value as of December 31, 19X1	_______	_______	_______

Chapter 3 Exercise 11. Product costs and period costsThe costs that follow were extracted from the accounting records of several different manufacturers:1. Weekly wages of an equipment maintenance worker2. Marketing costs of a soft drink bottler3. Cost of sheet metal in a Honda automobile4. Cost of president’s subscription to Fortune magazine5. Monthly operating costs of pollution control equipment used in a steel mill6. Weekly wages of a seamstress employed by a jeans maker7. Cost of compact discs (CDs) for newly recorded releases of Rush, Billy Joel, and Bryan Adamsa. Determine which of these costs are product costs and which are period costs.b. For the product costs only, determine those that are easily traced to the finished product and those that are not. Chapter 3 Exercise 2 2. Definitions of manufacturing concepts
Interstate Manufacturing produces brass fasteners and incurred the following costs for the year just ended:Materials and supplies usedBrass $75,000Repair parts 16,000Machine lubricants 9,000Wages and salaries Machine operators 128,000Production supervisors 64,000Maintenance personnel 41,000Other factory overhead Variable 35,000Fixed 46,000Sales commissions 20,000 Compute:a. Total direct materials consumedb. Total direct laborc. Total prime costd. Total conversion cost Chapter 3 Exercise 5 5. Schedule of cost of goods manufactured, income statementThe following information was taken from the ledger of Jefferson Industries, Inc.:

Direct labor	$85,000	Administrative expenses	$59,000
Selling expenses	34,000	Work in. process
Sales	300,000	Jan. 1	29,000
Finished goods		Dec. 31	21,000
Jan. 1	115,000	Direct material purchases	88,000
Dec. 31	131,000	Depreciation: factory	18,000
Raw (direct) materials on hand		Indirect materials used	10,000
Jan. 1	31,000	Indirect labor	24,000
Dec. 31	40,000	Factory taxes	8,000
		Factory utilities	11,000

Prepare the following:a. A schedule of cost of goods manufactured for the year ended December 31.b. An income statement for the year ended December 31. Chapter 3 Problem 3
3. Manufacturing statements and cost behaviorTampa Foundry began operations during the current year, manufacturing various products for industrial use. One such product is light-gauge aluminum, which the company sells for $36 per roll. Cost information for the year just ended follows.

Per Unit	Variable Cost	Fixed Cost
Direct materials	$4.50	$ —
Direct labor	6.5	—
Factory overhead	9	50,000
Selling	—	70,000
Administrative	—	135,000

Production and sales totaled 20,000 rolls and 17,000 rolls, respectively There is no work in process. Tampa carries its finished goods inventory at the average unit cost of production. Instructions: a. Determine the cost of the finished goods inventory of light-gauge aluminum.b. Prepare an income statement for the current year ended December 31c. On the basis of the information presented: 1. Does it appear that the company pays commissions to its sales staff? Explain.2. What is the likely effect on the $4.50 unit cost of direct materials if next year’s production increases? Why? DQ 1 Stock Features. What is callable preferred stock? Why do corporations issue such stock? Given the different features that are associated with stock (callable, cumulative, preferred, etc.), what type of stock would you want to buy personally and why?

Guided Response:

Review your peers’ posts. Respond to at least two of your classmates, letting them know if you agree with their type of desired stock and whether your answer would change (and why) based on:

a. Different economic conditions
b. Stage of the company (if the company is in a growth phase versus a mature state).

DQ 2

Role of Management Accounting. Review the roles of management accounting within a company. What is the most important role of management accounting? How is that different than financial accounting?

Guided Response:

Review your peers’ posts. Respond to at least two of your classmates, and provide at least two areas that management accountants focus on that your classmates didn’t include.