Apollo Manufacturing produces a basic cellphone as a contract manufacturer.

Apollo Manufacturing produces a basic cellphone as a contract manufacturer. Overhead is applied at a rate of $42 per
direct labor hour. The direct labor rate is $18 per hour. In March, there was no beginning or ending work in process, and
the assembly department produced 20,000 finished phones. The materials cost was $120,000, and there were 2,500
direct labor hours worked during the month. Actual overhead spending was $103,400 during the month.
Calculate the total cost of production in the month of March and the cost per unit for each phone produced. Determine
if overhead was over applied or under applied and by what amount.

Mega Manufacturing produces wooden chairs. The cutting department produces all of the component
parts and transfers the parts to the assembly department. The assembly department had no work in
process at the beginning of the month and had two jobs started during the month. Since materials are
transferred in, all materials are charged to each job at the beginning of the job. The materials cost is
$17.50 per chair. Assembly time is 20 minutes per chair and the direct labor rate is $15 per hour. Overhead
is charged to a job only when a job is completed and ready to transfer to finished goods. The overhead is
applied on a per-chair basis at a rate of $6 per chair. Job No. 1 was for 1,000 chairs, and it was started and
completed during the month. Job No. 2 was for 1,500 chairs, and it was 60% complete at month end.

Calculate the costs to complete Job No. 1 and the unit cost per chair. Calculate the costs charged as of
month's end and the equivalent units of production for Job No. 2.

Presented below is an income statement, with the past two years' results presented:
Prepare a vertical analysis of both 2016 and 2015. Display percentages to 3 decimal places (.654 =
65.4%). Discuss any line items from the income statement that may warrant further investigation from
management.

Revenue
Cost of goods sold
Gross profit
Selling cost
Administrative cost
Operating profit
Interest expense
Income before taxes
Income taxes
Net income

2016
$4,200,000
$2,910,000
$1,290,000
$280,000
$140,000
$870,000
$78,000
$792,000
$277,200
$514,800

2015
$4,000,000
$2,800,000
$1,200,000
$250,000
$120,000
$830,000
$80,000
$750,000
$262,500
$487,500

Presented below is a balance sheet for the last two years:
Prepare a horizontal analysis. Display percentages to 3 decimal places (.654 = 65.4%).
Discuss any line items from the balance sheet that may warrant further investigation from management.

Cash
Accounts receivable
Short-term investments
Current assets
Equipment, net of depreciation
Land
Total assets

2016
$118,000
$98,000
$60,000
$276,000
$220,000
$75,000
$571,000

2015
$115,000
$77,000
$65,000
$257,000
$205,000
$75,000
$537,000

Accounts payable
Wages payable
Short-term revolving bank loan
Current liabilities
Long-term debt
Total liabilities
Common stock

$72,000
$4,000
$85,000
$161,000
$128,000
$289,000
$100,000

$96,000
$3,000
$50,000
$149,000
$132,000
$281,000
$100,000