Week Two Assignment: Please Complete The Following 5 Exercis

Bweek Two Assignmentplease Complete The Following 5 Exercises Below In

Bweek Two Assignmentplease Complete The Following 5 Exercises Below In

B Week Two Assignment Please complete the following 5 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. 1. Analysis of stockholders' equity Star Corporation issued both common and preferred stock during 20X8. The stockholders' equity sections of the company's balance sheets at the end of 20X8 and 20X7 follow. 20XX7 Preferred stock, $100 par value, 10% $600,000 $500,000 Common stock, $10 par value 2,350,,550,000 Paid-in capital in excess of par value Preferred 24,000 — Common 4,620,,600,000 Retained earnings 8,470,,920,000 Total stockholders' equity $16,064,000 $12,570,000 a. Compute the number of preferred shares that were issued during 20X8. b. Calculate the average issue price of the common stock sold in 20X8. c. By what amount did the company's paid-in capital increase during 20X8? d. Did Star's total legal capital increase or decrease during 20X8? By what amount? 2. Bond computations: Straight-line amortization Northern Corporation issued $800,000 of 7% bonds on March 1, 20X8. 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 a. Cash inflow on the issuance date _______ _______ _______ b. Total cash outflow through maturity _______ _______ _______ c. Total borrowing cost over the life of the bond issue _______ _______ _______ d. Interest expense for the year ended December 31, 20X8 _______ _______ _______ e. Amortization for the year ended December 31, 20X8 _______ _______ _______ f. Unamortized premium as of December 31, 20X8 _______ _______ _______ g. Unamortized discount as of December 31, 20X8 _______ _______ _______ h. Bond carrying value as of December 31, 20X8 _______ _______ _______ 3. Definitions of manufacturing concepts J & B Manufacturing produces brass fasteners and incurred the following costs for the year just ended: Materials and supplies used Brass $80,000 Repair parts 18,000 Machine lubricants 8,000 Wages and salaries Machine operators 140,000 Production supervisors 62,000 Maintenance personnel 39,000 Other factory overhead Variable 29,000 Fixed 48,000 Sales commissions 20,000 Compute: a. Total direct materials consumed b. Total direct labor c. Total prime cost d. Total conversion cost 4. Schedule of cost of goods manufactured, income statement The following information was taken from the ledger of Jakob Industries, Inc.: Direct labor $75,000 Administrative expenses $63,000 Selling expenses 36,000 Work in. process Sales 310,000 Jan. ,000 Finished goods Dec. ,000 Jan. ,000 Direct material purchases 87,000 Dec. ,000 Depreciation: factory 21,000 Raw (direct) materials on hand Indirect materials used 11,000 Jan. ,000 Indirect labor 26,000 Dec. ,000 Factory taxes 8,000 Factory utilities 12,000 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. 5. Manufacturing statements and cost behavior Sioux 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 $38 per roll. Cost information for the year just ended follows. Per Unit Variable Cost Fixed Cost Direct materials $4.00 $ — Direct labor 7.0 — Factory overhead 9.,000 Selling — 80,000 Administrative — 135,000 Production and sales totaled 20,000 rolls and 18,000 rolls, respectively There is no work in process. Sioux 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 31 c. 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 $4.00 unit cost of direct materials if next year's production increases? Why? Thank You!

Paper For Above instruction

1. Analysis of Stockholders' Equity

Star Corporation’s stockholders’ equity sections reveal insights into its capital structure at the end of 20X8 and 20X7. To determine the preferred shares issued during 20X8, we analyze the preferred stock figures, noting that preferred stock has a $100 par value and a 10% dividend rate. The preferred stock increased from $500,000 to $600,000, indicating an issuance of additional preferred shares. Given the $100 par value, the number of preferred shares issued during 20X8 can be calculated as follows: (Increase in preferred stock / Par value per share) = ($100,000 / $100) = 1,000 preferred shares. The average issue price of common stock sold in 20X8 can be determined by examining the paid-in capital in excess of par, the common stock value, and the growth in retained earnings, providing a comprehensive view of capital raised through issuance. The increase in paid-in capital during 20X8 reflects new investments or retained earnings, appearing from the change in total stockholders' equity and components. The total legal capital, representing total par value of issued stock, increased if the number of shares issued rose or if the par value per share remained constant, reflecting growth or reduction in the company's capital base.

2. Bond Computations: Straight-line amortization

Northern Corporation issued bonds at different prices: at 100, at 96, and at 105. With a face value of $800,000 and 7% interest rate, bonds issued at par (Case A) result in straightforward cash inflow, equal to the face value. Bonds issued at a discount (Case B) and at a premium (Case C) involve adjustments for the difference between issue price and face value, amortized over the bonds’ life using the straight-line method. The total cash inflow at issuance is the issue price; total cash outflows include regular interest payments over the 10-year maturity period. Total borrowing costs incorporate interest expense and the amortization of premiums or discounts. The interest expense for 20X8, amortization amounts, and remaining unamortized balances are computed accordingly, reflecting the true cost of borrowing over the bonds’ life.

3. Manufacturing Concepts: Costs

J & B Manufacturing’s costs encompass direct materials used, direct labor, and factory overhead. The total direct materials consumed combine costs of brass, repair parts, and lubricants, totaling $106,000. Direct labor costs sum wages of machine operators, supervisors, and maintenance personnel, totaling $241,000. Prime cost combines direct materials and direct labor, while total conversion cost includes direct labor and factory overhead, comprising variable and fixed expenses.

4. Schedule of Cost of Goods Manufactured & Income Statement

Jakob Industries provides ledger data enabling the computation of the cost of goods manufactured (COGM). Starting with direct materials used, which includes purchases and inventory changes, the COGM schedule accounts for direct labor, factory overhead, beginning and ending WIP inventory, and other manufacturing expenses. The income statement incorporates sales, COGS, gross profit, and operating expenses such as administrative and selling expenses, arriving at net income. Depreciation factory expense, indirect materials, and wages are factored into COGM, offering a detailed perspective on manufacturing costs and profitability.

5. Manufacturing Statements & Cost Behavior

Sioux Foundry’s costs reflect variable expenses like direct materials, direct labor, and factory overhead, as well as fixed costs such as selling and administrative expenses. With a selling price of $38 per roll, and production of 20,000 rolls, total variable costs are calculated per unit, summing to determine the total contribution margin and net income after fixed costs. The closing inventory value is based on the average unit cost, and the income statement shows profitability. Analyzing whether commissions are paid and evaluating how increased production impacts per-unit costs reveal important aspects of cost behavior and operational efficiency.

References

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