1. The 2013 financial statements of CVS Caremark reported the following information (in millions):
|
CVS Caremark
|
2013
|
2012
|
|
Net sales
|
$126,761
|
$123,120
|
|
Cost of sales
|
102,978
|
100,632
|
|
Inventories, net
|
11,045
|
11,032
|
What is the inventory turnover ratio for 2013?
2. Leggett and Platt reported total inventory of $495.9 million on their 2013 balance sheet along with a LIFO reserve of $73.3 million. What would the company have reported on its balance sheet for inventory if it had used the FIFO method of accounting for inventory?
3. Mabel Company uses the average cost method to account for inventory and has the following activity during the month of March, 2014.
|
|
Units
|
Unit cost
|
|
Beginning inventory
|
350
|
$15.00
|
|
Purchase #1
|
650
|
12.00
|
|
Purchase #2
|
250
|
10.00
|
During March, Mabel sold 850 units. Compute the cost of goods sold for March and the ending inventory balance at March 31, 2014.
Same question above but Mabel Company uses the LIFO cost method to account for inventory and has the following activity during the month of March, 2014.
Again, Same question but Mabel Company uses the FIFO cost method to account for inventory and has the following activity during the month of March, 2014.
1. Indicate whether each of the following costs, incurred by a manufacturer, are period or product costs.
Vice president of manufacturing salary
Vice president for human Resources salary
Plant janitorial costs
Corporate jet operating expense
Depreciation on the sales office
Depreciation on the production equipment
Manufacturing overhead
Direct materials
Advertising expense 5.
Entertainment costs of vice president of manufacturinng
4. Boxcar, Inc., which uses a predetermined overhead rate based on direct labor hours, estimated total overhead for the year to be $10,000,000 and total direct labor hours to be 250,000 hours.
In March, Boxcar incurred actual overhead costs of $830,000 and used 20,000 hours.
a. Calculate Boxcar's predetermined overhead rate.
b. Calculate Boxcar's applied overhead.
c. How much was Boxcar's over- or under-applied overhead for the month of March?