Exam for Managerial Accounting for BSAB 2

 1. Sound Engineering, Inc., produces and sells a television cassette unit at a price of P400 a unit. The variable costs to make and sell each unit amount to P300.00. Total fixed costs for the year are P12,000,000. A large potential market for this type of product is available if manufacturers can reduce the price. Sound Engineering, Inc. has changed production methods and has found a way to reduce the variable cost to P200 a unit. Plans are being made to sell this product next year for P250 a unit. The fixed costs will remain the same. 

Required:

1. Prepare a break-even chart with the selling price at P400 and the variable costs of P300. Give intervals of 20,000 units varying from 100,000 to 200,000 units.

2. Prepare a break-even chart with the selling price at 250 and the variable costs at P200. Give intervals of 20,000 units ranging from 200,000 to 300,000 units.

3. Prepare a profit-volume graph with the selling price at P400 and the variable costs at P300. Give intervals of 20,000 units varying from 100,000 to 200,000 units.

4. Prepare a profit-volume graph with the selling price at P250 and the variable cost at P200. Give intervals of 20,000 units ranging from 200,000 to 300,000 units.

2. EZ Rental Car offers rental cars in an off-airport location near a major tourist destination in Florida. Management would like to better understand the behavior of the company’s costs. One of those costs is the cost of washing cars. The company operates its own car wash facility in which each rental car that is returned is thoroughly cleaned before being released for rental to another customer. Management believes that the costs of operating the car wash should be related to the number of rental returns. Accordingly, the following data have been compiled:

        Month                Rental Return                Carwash Costs

        January                   2,310                            10,113

        February                3,200                               9,340

        March                     4,530                              11,590

        April                        4,500                               12,580

        May                         3,400                               14,700

        June                         4,800                               13,500

        July                           3,540                               10,450

        August                     4,604                                11,430

        September              2,800                                10,500

        October                    3,670                                 9,290

        November                4,500                                11,500

        December                2,500                                 12,530

Required:

Using least-squares regression, estimate the fixed cost and variable cost elements of monthly car wash costs. The fixed cost element should be estimated to the nearest peso and the variable cost element to the nearest cent. 

3. Analysis of the Business Transaction

PROBLEMS:

1. What are the different forms of the journal that are commonly used in the business?

2. What is the importance of using a Journal?

3. What are the steps in posting transactions to the Journal?

4. Post the following information to the general Journal by using the proper procedure in posting 19A

 Jan.     2          - A Manriquez sold his lot costing P10,000.00 for P15,000.00 and invested the proceeds in a dry goods store named Empire Trading

            3          - Bought goods from Manila. Trading, P8,850.00 Terms: P850.00 down P4,500.00,    15-day, 6% note; balance 2/10,       n/30.

            4          - Deposited P12,000.00 with Filipino Bank

            5          - Received a credit memo from Manila Trading, P100.00 for merchandise returned.

            6          - Cash sales to date, P5,100.00. Deposited the same with Filipino Bank

            7          - Sold merchandise to Fernando Galvez, P4,500.00 Terms: P1,500.00 down, P2,000.00  2- day, 6% note, balance 2/10, n/30.

            8          - Issued a credit memo for the allowance of P90.00 granted to F. Galvez for defective goods.

            9          - Issued a check to Manila Trading, P800.00 to apply on account

  10        - Received a check for P300.00 from F. Galvez to apply to n account

            11.       - Purchased store equipment from Philco Trading, P1,500.00. Terms: 2/10, n/30.

13        - Issued a check to Manila Trading in full of account.

14        - Issued a check to Vasquez Bros. for store supplies bought, P120.00 terms: cash, loans 3%.

15        - Received a 60-day, 6% note for P750.00 from

L. Marts for merchandise sold

16        - Returned supplies worth P25.00 to Vasquez Bros. and received a check therefor.

17        - The owner took home goods costing P100.00 and priced to sell at P150.00 for his family's use.

18        - Paid the note issued to Manila Trading on the 3rd with a check.

21        - Gave a salary advance of P100.00 cash to an employee

24        - A check was issued. full payment of the owner's personal debt evidenced by his 30- day, 6% for P800.00.

27        - Collected the note of  F. Galvez

          30        - Cash sales P1,200.00

31        - Paid in cash salaries of P1,500.00 fro which deductions were made as follows:

for SSS premiums         -       P 40.00

for withholding taxes     -       P 20.00

for Salary advance        -      P100.00