ACCT 301 Questions: 1- Prepare the journal entries for the following: (4 Points) a. When raw materials are received, Give an example b. When raw materials are sent to the factory floor, Give an example c. When a job is completed, what happen to the cost, Give an example d. Overhead expenses (salary) paid by cheque $ 5000 e. Utilities (Indirect expenses) paid in cash $ 10000. f. Salaries totaling $5,000 are accrued; 35% of these costs are direct labor, 40% are indirect labor and 25% are overhead expense. Prepare the journal entry. g. Overhead costs are allocated to work in process using an allocation rate of 150% of direct labor costs and 300% of overhead expenses. Prepare the journal entry. (Give different examples- examples should not be same) 2- Riyadh Electricity Company manufactures chandeliers. Following is information for next year’s operations, based on an estimated volume of 20,000 units: (4 Points) Expected revenues $1,000,000 Unit costs: Direct materials $6.25 Direct labor 15.75 Variable overhead 5.50 Fixed manufacturing overhead 2.50 Total $30.00 Other fixed costs: Administration, marketing, etc. $225,000 Income tax rate 30% a. What is the breakeven point for next year? b. What is next year’s projected after-tax income? c. Suppose the managers set a target after-tax income of $100,000. Estimate the number of units that must be sold. 3- Ahmed has budgeted next year’s sales at 8,000 units. (2Points) Compute Ahmed’s degree of operating leverage. If P = 1,000, V = 400, F = 850,000.
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