Financial & Managerial 14e Check Figures

Chapter 1

No check figures required. Problem material is qualitative in nature.

Chapter 2

Solutions to Problem Set A
Problem 2.1A Total assets = $1,010,300; Total liabilities = $720,300
Problem 2.2A Issued capital stock for $15,000 (part e).
Problem 2.3A Ending cash balance = $41,250
Problem 2.4A Ending cash balance = $77,600
Problem 2.5A Total assets = $553,080; Total liabilities = $215,850
Problem 2.6A Total assets = $901,470; Total liabilities = $422,050
Problem 2.7A Total assets (8/3) = $236,700; Total liabilities (8/3) = $91,000
Problem 2.8A Total assets (10/6) = $173,590; Total liabilities (10/6) = $88,000
Problem 2.9A Total assets = $51,500; Total liabilities = $23,100
Problem 2.10A Total assets = $114,735; Total liabilities = $106,200

Solutions to Problem Set B
Problem 2.1B Total assets = $614,000; Total liabilities = $261,600
Problem 2.2B Issued capital stock for $10,000 (part e).
Problem 2.3B Ending cash balance = $50,000
Problem 2.4B Ending cash balance = $27,600
Problem 2.5B Total assets = $630,250; Total liabilities = $141,250
Problem 2.6B Total assets = $226,700; Total liabilities = $79,000
Problem 2.7B Total assets (7/5) = $213,300; Total liabilities (7/5) = $49,700
Problem 2.8B Total assets (10/6) = $211,900; Total liabilities (10/6) = $58,000
Problem 2.9B Total assets = $56,400; Total liabilities = $23,000
Problem 2.10B Total assets = $115,900; Total liabilities = $102,500


Chapter 3

Solutions to Problem Set A
Problem 3.1A Liabilities (Accounts Payable) increased (credited) $8,000 on 2/18.
Problem 3.2A Debit Accounts Payable $100 on 8/5.
Problem 3.3A Debit Advertising Expense $165 on 9/14.
Problem 3.4A Total stockholders equity (6/30) = $63,990
Problem 3.5A Total assets (5/31) = $579,400
Problem 3.6A Debit column total of trial balance (7/31) = $3,550
Problem 3.7A Debit column total of trial balance (6/30) = $19,300
Problem 3.8A The first error listed understates (U) Owners Equity.

Solutions to Problem Set B
Problem 3.1B Liabilities (Accounts Payable) increased (credited) $11,000 on 4/12.
Problem 3.2B Debit Accounts Payable $100 on 6/5.
Problem 3.3B Debit Advertising Expense $320 on 10/12.
Problem 3.4B Total stockholders equity (3/31) = $85,670
Problem 3.5B Total assets (8/31) = $625,800
Problem 3.6B Debit column total of trial balance (2/28) = $4,805
Problem 3.7B Debit column total of trial balance (3/31) = $24,300
Problem 3.8B The first error listed understates (U) Owners Equity.

Chapter 4

Solutions to Problem Set A
Problem 4.1A Adjusting entry (4): Debit Depreciation Expense: Carts, $1,000.
Problem 4.2A Adjusting entry (7): Debit Unearned Camper Revenue, $900.
Problem 4.3A Adjusting entry (4): Credit Passenger Revenue Earned, $75,000.
Problem 4.4A Adjusting entry (1): Credit Prepaid Film Rental, $15,200.
Problem 4.5A Adjusting entry (3): Credit Unexpired Insurance, $300.
Problem 4.6A Adjusting entry (5): Credit Climbing Supplies, $2,900.
Problem 4.7A Net Income for the year ended 12/31/07 = $27,720
Problem 4.8A Owners Equity is understated (U) as a result of transaction g.

Solutions to Problem Set B
Problem 4.1B Adjusting entry (5): Debit Interest Expense, $400.
Problem 4.2B Adjusting entry (7): Debit Unearned Camper Revenue, $1,500.
Problem 4.3B Adjusting entry (4): Credit Unexpired Insurance, $240.
Problem 4.4B Adjusting entry (7): Credit Salaries Payable, $2,200.
Problem 4.5B Adjusting entry (3): Credit Unexpired Insurance, $400.
Problem 4.6B Adjusting entry (4): Credit Office Supplies, $1,720.
Problem 4.7B Net Income for the year ended 12/31/07 = $10,205
Problem 4.8B Owners Equity is overstated (O) as a result of transaction g.

Chapter 5

Solutions to Problem Set A
Problem 5.1A Retained earnings on 12/31/07 = $21,000
Problem 5.2A Total assets on 12/31/07 = $113,400
Problem 5.3A Net loss for the year ended 12/31/07 = $31,240
Problem 5.4A Net income for the quarter ended 9/30 = $20,600
Problem 5.5A Total assets on 12/31/07 = $65,525
Problem 5.6A Total debit column of the adjusted balance = $252,690
Problem 5.7A Total debit column of the adjusted balance = $371,430
Problem 5.8A End of year current ratio = 2.17 to 1

Solutions to Problem Set B
Problem 5.1B Retained earnings on 12/31/07 = $33,300
Problem 5.2B Total assets on 12/31/07 = $124,400
Problem 5.3B Net loss for the year ended 12/31/07 = $31,600
Problem 5.4B Net income for the quarter ended 9/30 = $28,300
Problem 5.5B Total assets on 12/31/07 = $442,450
Problem 5.6B Total debit column of the adjusted balance = $113,355
Problem 5.7B Total debit column of the adjusted balance = $633,250
Problem 5.8B End of year current ratio = 2.7 to 1

Chapter 6

Solutions to Problem Set A
Problem 6.1A Gross profit for year ended 12/31 = $327,968
Problem 6.2A Net income for the year ended 12/31/07 = $12,000
Problem 6.3A Change in net sales during 2006-2007 = 6%
Problem 6.4A Debit Cost of Goods Sold $294 on 6/15 (part a.1).
Problem 6.5A Debit Cost of Goods Sold $6,000 on 2/9 (part a).
Problem 6.6A Inventory is overstated by $14,700 (part a.2).
Problem 6.7A Gross profit is $350,000 (part a).
Problem 6.8A Gross profit is $3,900 (part g).

Solutions to Problem Set B
Problem 6.1B Gross profit for year ended 12/31 = $698,500
Problem 6.2B Net income for the year ended 12/31/07 = $33,970
Problem 6.3B Change in net sales during 2006-2007 = 4.9%
Problem 6.4B Debit Cost of Goods Sold $686 on 5/11 (part a.1).
Problem 6.5B Debit Cost of Goods Sold $6,000 on 10/12 (part a).
Problem 6.6B Inventory is overstated by $7,350 (part a.2).
Problem 6.7B Gross profit is $50,000 (part a).
Problem 6.8B Gross profit is $18,000 (part h).
Chapter 7

Solutions to Problem Set A
Problem 7.1A Adjusted cash balance on 7/31 = $129,714
Problem 7.2A Correct adjusted cash balance on 11/30 = $15,745
Problem 7.3A Debit Uncollectible Accounts Expense $25,500 on 12/31.
Problem 7.4A Debit Uncollectible Accounts Expense $160,000 on 12/31.
Problem 7.5A Debit Loss on Sale of Investments $6,060 on 8/7 (part b).
Problem 7.6A Credit Interest Revenue $3,125 on 6/1 (part a).
Problem 7.7A Credit Interest Revenue $250 on 12/31 (part c).
Problem 7.8A Cash and cash equivalents on 12/31/07 (part b) = $171,460

Solutions to Problem Set B
Problem 7.1B Adjusted cash balance on 11/30 = $7,745
Problem 7.2B Correct adjusted cash balance on 4/30 = $16,730
Problem 7.3B Debit Uncollectible Accounts Expense $44,600 on 12/31.
Problem 7.4B Debit Uncollectible Accounts Expense $141,000 on 12/31.
Problem 7.5B Debit Loss on Sale of Investments $5,020 on 4/20 (part b).
Problem 7.6B Credit Interest Revenue $4,200 on 8/1 (part a).
Problem 7.7B Credit Interest Revenue $360 on 12/31 (part c).
Problem 7.8B Cash and cash equivalents on 12/31/07 (part b) = $263,500

Chapter 8

Solutions to Problem Set A
Problem 8.1A Debit Cost of Goods Sold $30,200 on 1/15 (part a, FIFO method).
Problem 8.2A Inventory balance on 9/30 (LIFO method) = $20,250
Problem 8.3A Inventory balance on 9/30 (FIFO method) = $20,300
Problem 8.4A Debit Cost of Goods Sold $1,560 (part a, LIFO method).
Problem 8.5A Inventory balance (FIFO method) = $6,710
Problem 8.6A Gross profit percentage in 2007 = 36%
Problem 8.7A Estimated ending inventory (part a) = $52,800
Problem 8.8A Gross profit rate (LIFO method) = 21.5%

Solutions to Problem Set B
Problem 8.1B Debit Cost of Goods Sold $14,600 on 1/22 (part a, FIFO method).
Problem 8.2B Inventory balance on 6/30 (LIFO method) = $57,500
Problem 8.3B Inventory balance on 6/30 (FIFO method) = $58,300
Problem 8.4B Debit Cost of Goods Sold $120 (part a, LIFO method).
Problem 8.5B Inventory balance (FIFO method) = $2,180
Problem 8.6B Gross profit percentage in 2007 = 32%
Problem 8.7B Estimated ending inventory (part a) = $44,000
Problem 8.8B Gross profit rate (LIFO method) = 32.2%

Chapter 9

Solutions to Problem Set A
Problem 9.1A Debit Depreciation Expense: Computing Equipment $27,100 (part d).
Problem 9.2A Depreciation Expense, 2008 = $20,736 (200% declining-balance)
Problem 9.3A Depreciation Expense, 2008 = $1,155 (150% declining-balance)
Problem 9.4A Credit Gain on Sale of Plant Assets on 4/1, $550,000.
Problem 9.5A Operating expense (part e).
Problem 9.6A Estimated goodwill of Joes Garage (part a) = $1,085,000
Problem 9.7A Accumulated depreciation (part b) = $12,800
Problem 9.8A Amortization of patent (part b) = $15,000

Solutions to Problem Set B
Problem 9.1B Debit Depreciation Expense: Equipment $3,860 (part d).
Problem 9.2B Depreciation Expense, 2008 = $57,600 (200% declining-balance)
Problem 9.3B Depreciation Expense, 2008 = $1,665 (150% declining-balance)
Problem 9.4B Credit Gain on Sale of Plant Assets on 3/3, $320,000.
Problem 9.5B Intangible asset (part d).
Problem 9.6B Estimated goodwill of Carnies (part a) = $1,600,000
Problem 9.7B Accumulated depreciation (part b) = $7,000
Problem 9.8B Amortization of patent (part b) = $13,333



Chapter 10

Solutions to Problem Set A
Problem 10.1A Income statement, transaction a: increase expenses; decrease net income.
Problem 10.2A Total current liabilities = $381,000
Problem 10.3A Debit Interest Expense on 12/31, $6,428.
Problem 10.4A Debit Interest Expense on 11/1, $10,797.
Problem 10.5A Debit Bond Interest Expense on 12/31, $166,667.
Problem 10.6A Debit Bond Interest Expense on 12/31, $2,693,334 (part a.1).
Problem 10.7A Total liabilities (part a) = $1,088,620
Problem 10.8A Total liabilities (part a) = $1,576,000

Solutions to Problem Set B
Problem 10.1B Income statement, transaction a: increase expenses; decrease net income.
Problem 10.2B Total current liabilities = $381,000
Problem 10.3B Debit Interest Expense on 12/31, $1,050.
Problem 10.4B Debit Interest Expense on 11/1, $1,000.
Problem 10.5B Debit Bond Interest Expense on 12/31, $25,000.
Problem 10.6B Debit Bond Interest Expense on 12/31, $203,333 (part a.1).
Problem 10.7B Total liabilities (part a) = $881,580
Problem 10.8B Total liabilities (part a) = $1,540,500

Chapter 11

Solutions to Problem Set A
Problem 11.1A Total stockholders equity on 12/31 = $3,805,000
Problem 11.2A Total stockholders equity on 12/31 = $8,210,000
Problem 11.3A Total stockholders equity on 12/31 = $2,452,000
Problem 11.4A Debit Land on 6/4, $225,000.
Problem 11.5A Book value per share (part g) = $26.27
Problem 11.6A Total paid-in capital (part c) = $180,329
Problem 11.7A No check figures given.
Problem 11.8A Total stockholders equity = $590,000
Problem 11.9A Total stockholders equity = $6,695,000

Solutions to Problem Set B
Problem 11.1B Total stockholders equity on 12/31 = $2,902,000
Problem 11.2B Total stockholders equity on 12/31 = $7,900,000
Problem 11.3B Total stockholders equity on 12/31 = $4,463,000
Problem 11.4B Debit Dividends (Preferred Stock) on 7/5, $20,000.
Problem 11.5B Book value per share (part g) = $8.09
Problem 11.6B Total paid-in capital (part c) = $136,400
Problem 11.7B No check figures given.
Problem 11.8B Total stockholders equity = $840,000
Problem 11.9B Total stockholders equity = $7,051,440


Chapter 12

Solutions to Problem Set A
Problem 12.1A Net income = $14,260,000
Problem 12.2A Retained Earnings on 12/31/07 (part b) = $7,625,000
Problem 12.3A Retained Earnings on 12/31/07 (part b) = $2,305,000
Problem 12.4A Total stockholders equity at 12/31 = $1,293,600
Problem 12.5A Total stockholders equity at 12/31 = $4,760,300
Problem 12.6A Total stockholders equity at 12/31 (part b) = $8,792,800
Problem 12.7A Total stockholders equity decreased (part a.1).
Problem 12.8A Total stockholders equity at 12/31/07 (part b) = $5,914,000
Problem 12.9A Net loss = $18,301

Solutions to Problem Set B
Problem 12.1B Net income = $9,340,000
Problem 12.2B Retained Earnings on 12/31/07 (part b) = $23,055,000
Problem 12.3B Retained Earnings on 12/31/07 (part b) = $6,358,000
Problem 12.4B Total stockholders equity at 12/31 = $438,000
Problem 12.5B Total stockholders equity at 12/31 = $3,960,000
Problem 12.6B Total stockholders equity at 12/31 (part b) = $9,228,925
Problem 12.7B Total stockholders equity increased (part a.4).
Problem 12.8B Total stockholders equity at 12/31/07 (part b) = $2,136,800
Problem 12.9B Net loss = $16,220
Chapter 13

Solutions to Problem Set A
Problem 13.1A Net cash flow from operating activities (part a) = $275,000
Problem 13.2A Net cash flow used in investing activities (part a) = ($39,000)
Problem 13.3A Net cash flow used in investing activities (part a) = ($25,000)
Problem 13.4A Net cash flow from operating activities (part a) = $336,000
Problem 13.5A Net cash flow from operating activities = $336,000
Problem 13.6A Net cash flow from operating activities (part a) = $350,000
Problem 13.7A Net decrease in cash for the year = $43,000
Problem 13.8A Net increase in cash for the year = $50,000

Solutions to Problem Set B
Problem 13.1B Net cash flow from operating activities (part a) = $735,000
Problem 13.2B Net cash flow used in investing activities (part a) = ($91,000)
Problem 13.3B Net cash flow used in investing activities (part a) = ($35,000)
Problem 13.4B Net cash flow from operating activities (part a) = $935,000
Problem 13.5B Net cash flow from operating activities = $935,000
Problem 13.6B Net cash flow from operating activities (part a) = $923,000
Problem 13.7B Net cash flow used in operating activities (part a) = ($158,000)
Problem 13.8B Net increase in cash for the year = $38,000


Chapter 14

Solutions to Problem Set A
Problem 14.1A Industry average net income as a percentage of sales = 4%
Problem 14.2A Net income for 2007 (part d) = $172,800
Problem 14.3A Total current liabilities = $229,670
Problem 14.4A Current ratio = 1.01 to 1
Problem 14.5A Current ratio = 3 to 1
Problem 14.6A Return on assets = 10.5%
Problem 14.7A Current ratio (end of year) = 0.72 to 1
Problem 14.8A Inventory turnover = 4.68 times
Problem 14.9A Current ratio (Another World) = 2 to 1

Solutions to Problem Set B
Problem 14.1B Bathrooms, Inc. net income as a percentage of sales = 17%
Problem 14.2B Net income for 2007 (part d) = $150,000
Problem 14.3B Total current liabilities = $225,200
Problem 14.4B Current ratio = 0.69 to 1
Problem 14.5B Current ratio = 2.95 to 1
Problem 14.6B Return on assets = 8.1%
Problem 14.7B Current ratio (end of year) = 1.09 to 1
Problem 14.8B Inventory turnover = 7.14 times
Problem 14.9B Current ratio (That Star) = 2.64 to 1

Chapter 15

Solutions to Problem Set A
Problem 15.1A Profit in kr (part a) = kr 3,740
Problem 15.2A Debit Inventory $2,549,000 on 11/12.
Problem 15.3A Gross profit = $303.00 (if C$ = $0.75)
Problem 15.4A Profit per unit (Malaysia) = 175.40 Ringgits
Problem 15.5A No check figures given.
Problem 15.6A Debit Accounts Receivable (Bank of England) $997,425 on 11/9.
Problem 15.7A No check figures given.
Problem 15.8A Percentage of sales in 2005 (part b) = 6.5%

Solutions to Problem Set B
Problem 15.1B Profit in kr (part a) = kr 8,375
Problem 15.2B Debit Inventory $3,000,000 on 12/1.
Problem 15.3B Gross profit = $228.50 (if C$ = $0.70)
Problem 15.4B Profit per unit (Malaysia) = 181.50 Ringgits
Problem 15.5B No check figures given.
Problem 15.6B Debit Accounts Receivable (British Vibes) $320,000 on 11/15.
Problem 15.7B No check figures given.
Chapter 16

Solutions to Problem Set A
Problem 16.1A Ending finished goods inventory (part a) = $78,000
Problem 16.2A Cost of goods sold (part c) = $2,880,000
Problem 16.3A Total manufacturing costs (part e) = $613,400
Problem 16.4A Cost of finished goods manufactured (part f) = $951,000
Problem 16.5A Cost of goods sold (part a) = $1,000,600
Problem 16.6A Cost of goods sold (part a) = $827,985
Problem 16.7A Cost of goods sold (part c) = $1,110,000
Problem 16.8A Cost of finished goods manufactured (part a) = $383,500

Solutions to Problem Set B
Problem 16.1B Ending finished goods inventory (part a) = $90,000
Problem 16.2B Cost of goods sold (part c) = $2,400,000
Problem 16.3B Overhead rate (part e) = 150%
Problem 16.4B Total cost charged to work in process (part f) = $994,000
Problem 16.5B Cost of goods sold (part a) = $1,049,000
Problem 16.6B Cost of goods sold (part a) = $979,450
Problem 16.7B Cost of goods sold (part c) = $1,016,000
Problem 16.8B Cost of finished goods manufactured (part a) = $376,000

Chapter 17

Solutions to Problem Set A
Problem 17.1A Debit Work in Process Inventory $34,500 (part b).
Problem 17.2A Debit Work in Process Inventory $56,200 (part b).
Problem 17.3A Application rate based on machine hours (part a) = $35 per MH
Problem 17.4A Debit Cost of Goods Sold $11,000 (part c).
Problem 17.5A Total cost of Job 2 (part b.2) = $7,210
Problem 17.6A Inspection costs allocated to Bitrite (part c) = $16,000
Problem 17.7A Repair costs allocated to A3B4 (part b) = $2,500
Problem 17.8A Total costs allocated to Basic Chunks (using ABC) = $125,370

Solutions to Problem Set B
Problem 17.1B Debit Work in Process Inventory $57,000 (part b).
Problem 17.2B Debit Work in Process Inventory $98,000 (part b).
Problem 17.3B Application rate based on machine hours (part a) = $20 per MH
Problem 17.4B Debit Cost of Goods Sold $33,000 (part c).
Problem 17.5B Total cost of Job 2 (part b.2) = $196
Problem 17.6B Inspection costs allocated to Caltrate (part c) = $750,000
Problem 17.7B Setup costs allocated to boots (part b) = $31,250
Problem 17.8B Total costs allocated to Tabby Treat (using ABC) = $167,780
Chapter 18

Solutions to Problem Set A
Problem 18.1A Units started and completed in July (part b) = 2,100
Problem 18.2A Cost per unit (part a.1) = $45
Problem 18.3A Cost per unit of direct materials = $61.50
Problem 18.4A Debit Work in Process: Mixing Dept. $12,600 (part a)
Problem 18.5A Cost per unit of conversion (part b) = $4
Problem 18.6A Cost per unit of direct materials = $3
Problem 18.7A Cost per unit of direct materials (part a) = $14
Problem 18.8A Cost per unit of conversion (part a) = $8

Solutions to Problem Set B
Problem 18.1B Units started and completed in April (part b) = 2,400
Problem 18.2B Cost per unit (part a.1) = $49
Problem 18.3B Cost per unit of direct materials = $112
Problem 18.4B Debit Work in Process: Mixing Dept. $120,000 (part a)
Problem 18.5B Cost per unit of conversion (part b) = $7
Problem 18.6B Cost per unit of direct materials = $4
Problem 18.7B Cost per unit of direct materials (part a) = $18
Problem 18.8B Cost per unit of conversion (part a) = $6

Chapter 19

Solutions to Problem Set A
Problem 19.1A Value-added time (part d) = 25 days
Problem 19.2A Target cost (part a) = $187
Problem 19.3A Target cost (part a) = $6.40
Problem 19.4A Year 1 total quality costs (part a) = $88,400
Problem 19.5A No check figures given.
Problem 19.6A Profit increase (part b) = $455,000
Problem 19.7A Total non-value added costs (part b) = $25,750
Problem 19.8A No check figures given.

Solutions to Problem Set B
Problem 19.1B Value-added time (part d) = 86 days
Problem 19.2B Target cost (part a) = $90
Problem 19.3B Target cost (part a) = $8.20
Problem 19.4B Year 1 total quality costs (part a) = $96,000
Chapter 20

Solutions to Problem Set A
Problem 20.1A Required sales price (part a) = $100
Problem 20.2A Sales per unit (part a) = $105
Problem 20.3A Total fixed costs = $225,000
Problem 20.4A Contribution margin ratio (part a) = 40%
Problem 20.5A Contribution margin per unit (part a) = $0.45
Problem 20.6A Contribution margin per unit (part b) = $37
Problem 20.7A Clownfish operating income (part a) = $186,750
Problem 20.8A Monthly break-even in sales volume (part b) = $945,000

Solutions to Problem Set B
Problem 20.1B Required sales price (part a) = $140
Problem 20.2B Sales per unit (part a) = $67
Problem 20.3B Total fixed costs = $149,940
Problem 20.4B Contribution margin ratio (part a) = 40%
Problem 20.5B Contribution margin per unit (part a) = $2
Problem 20.6B Contribution margin per unit (part b) = $8.80
Problem 20.7B Cod operating income (part a) = $214,000
Problem 20.8B Monthly break-even in sales volume (part b) = $1,200,000
Chapter 21

Solutions to Problem Set A
Problem 21.1A Expected increase in operating income (part a) = $250,000
Problem 21.2A Benefit of buying motors (part b) = $157,500
Problem 21.3A Benefit of buying thermostats (part b) = $26,000
Problem 21.4A Contribution margin per MH Model 100 (part a) = $31
Problem 21.5A Sunk costs (part b) = $450,000
Problem 21.6A Benefit of selling to foreign buyer (part a) = $1,100,000
Problem 21.7A Benefit to process into Sea Powder (part a) = $1,000
Problem 21.8A No check figures given.

Solutions to Problem Set B
Problem 21.1B Expected increase in operating income (part a) = $225,000
Problem 21.2B Benefit of buying motors (part b) = $305,000
Problem 21.3B Benefit of buying switches (part b) = $149,000
Problem 21.4B Contribution margin per MH Model B (part a) = $39
Problem 21.5B Sunk costs (part b) = $150,000
Problem 21.6B Benefit of selling to foreign buyer (part a) = $1,360,000
Problem 21.7B Benefit to process into Mint Powder (part a) = $10,000
Problem 21.8B Contribution margin per DLH Gloves (part a) = $15
Chapter 22

Solutions to Problem Set A
Problem 22.1A Product responsibility margin Bottled Water (part a) = $125,000
Problem 22.2A Product responsibility margin Jewelry Line (part a) = $160,000
Problem 22.3A Division responsibility margin Commercial Sales (part a) = $330,000
Problem 22.4A Division responsibility margin FasTrack (part a) = $160,000
Problem 22.5A Expected responsibility margin increase Product B (part a) = $800
Problem 22.6A Increased sales required (part c) = $16,000
Problem 22.7A Contribution margin Motor Division (part a) = $3,300,000
Problem 22.8A Operating profit Green Division (part a) = $70,000

Solutions to Problem Set B
Problem 22.1B Product responsibility margin Zippers (part a) = $18,000
Problem 22.2B Product responsibility margin Bag Line (part a) = $150,000
Problem 22.3B Division responsibility margin Deluxe Division (part a) = $500,000
Problem 22.4B Division responsibility margin Economy (part a) = $260,000
Problem 22.5B Expected responsibility margin increase Product C (part a) = $4,500
Problem 22.6B Increased sales required (part c) = $10,000
Problem 22.7B Contribution margin Motor Division (part a) = $5,400,000
Problem 22.8B Operating profit Frame Division (part a) = $66,500
Chapter 23

Solutions to Problem Set A
Problem 23.1A Ending finished goods inventory (part c) = $770,000
Problem 23.2A Ending finished goods inventory (part c) = $780,000
Problem 23.3A Ending cash balance = $46,800
Problem 23.4A Payments on current payables (part b) = $330,000
Problem 23.5A Budgeted income (part a) = $5,655
Problem 23.6A Ending September cash (part a) = $398,400
Problem 23.7A Operating income over budget (part a) = $178,500
Problem 23.8A Total manufacturing costs under budget (part a) = $27,000

Solutions to Problem Set B
Problem 23.1B Ending finished goods inventory (part c) = $646,750
Problem 23.2B Ending finished goods inventory (part c) = $1,140,000
Problem 23.3B Ending cash balance = $93,950
Problem 23.4B Payments on current payables (part b) = $427,000
Problem 23.5B Budgeted income (part a) = $16,500
Problem 23.6B Ending September cash (part a) = $376,800
Problem 23.7B Operating income over budget (part a) = $2,360,000
Problem 23.8B Total manufacturing costs under budget (part a) = $55,000
Chapter 24

Solutions to Problem Set A
Problem 24.1A Debit Work in Process Inventory $8,700 (part c).
Problem 24.2A Materials price variance (part a) = $3,075 favorable
Problem 24.3A Debit Finished Goods Inventory $270,000 (part b).
Problem 24.4A Labor rate variance (part b) = $1,100 favorable
Problem 24.5A Labor efficiency variance (part b) = $7,200 unfavorable
Problem 24.6A Overhead spending variance (part c) = $600 unfavorable
Problem 24.7A Overhead volume variance (part a) = $3,000 unfavorable
Problem 24.8A Material used in June (part a) = 8,200 pounds
Problem 24.9A Actual price (part a) = $0.30 per square foot

Solutions to Problem Set B
Problem 24.1B Debit Work in Process Inventory $8,400 (part c).
Problem 24.2B Materials price variance (part a) = $20,500 favorable
Problem 24.3B Debit Finished Goods Inventory $300,000 (part b).
Problem 24.4B Labor rate variance (part b) = $625 favorable
Problem 24.5B Labor efficiency variance (part b) = $4,500 unfavorable
Problem 24.6B Overhead spending variance (part c) = $260 favorable
Problem 24.7B Overhead volume variance (part a) = $2,000 unfavorable
Problem 24.8B Material used in June (part a) = 1,500 pounds
Problem 24.9B Actual price (part a) = $0.24 per square foot
Chapter 25

Solutions to Problem Set A
Problem 25.1A ROI Empire Hotel (part a) = 17.14%
Problem 25.2A No check figures given.
Problem 25.3A Managers bonus (part b) = $41,000
Problem 25.4A United States ROI Year 2 (part a) = 12.8%
Problem 25.5A Operating Income Project A-1 (part d) = $21,150
Problem 25.6A No check figures given.
Problem 25.7A No check figures given.
Problem 25.8A No check figures given.
Problem 25.9A ROI (part a) = 15%

Solutions to Problem Set B
Problem 25.1B ROI Golf Courses (part a) = 40%
Problem 25.2B No check figures given.
Problem 25.3B Managers bonus (part b) = $34,500
Problem 25.4B United States ROI Year 2 (part a) = 23.58%
Problem 25.5B Operating Income Project A-2 (part d) = $32,400
Problem 25.6B No check figures given.
Problem 25.7B No check figures given.
Problem 25.8B No check figures given.
Problem 25.9B ROI (part a) = 18.35%
Chapter 26

Solutions to Problem Set A
Problem 26.1A Payback period (part c) = 2.3 years
Problem 26.2A Return on average investment Proposal 1 (part a) = 16.7%
Problem 26.3A Payback period Proposal B (part a) = 3.7 years
Problem 26.4A Net present value Proposal B (part a) = ($10,845)
Problem 26.5A Net present value Proposal A (part a) = ($30,000)
Problem 26.6A Net present value (part c) = $16,950
Problem 26.7A Net present value (part c) = $1,350
Problem 26.8A Net present value chair lift (part c) = $19,720
Problem 26.9A Net present value software bank installation (part c) = $24,880

Solutions to Problem Set B
Problem 26.1B Payback period (part c) = 1.25 years
Problem 26.2B Return on average investment Proposal 1 (part a) = 20%
Problem 26.3B Payback period Proposal B (part a) = 4.3 years
Problem 26.4B Net present value Proposal B (part a) = ($4,620)
Problem 26.5B Net present value Proposal A (part a) = ($25,600)
Problem 26.6B Net present value (part c) = $256,973
Problem 26.7B Net present value (part c) = ($276,713)
Problem 26.8B Net present value chair lift (part c) = $33,760
Problem 26.9B Net present value memory stick (part c) = $365,200