I only need help with problems: 3, 5d, 12, 16, 17a, 17c 1. (5 points) Make a lis
ID: 2379695 • Letter: I
Question
I only need help with problems: 3, 5d, 12, 16, 17a, 17c
1. (5 points) Make a list of materials needed to manufacture one finished good. Include the following criteria: material (including block size), color, number required, cost per block, and total cost per type of block. Determine the total material cost to manufacture one finished good. Include packaging for the finished product.
2. (4 points) Determine how many direct labor employees are necessary to meet demand. You do not intend to pay overtime. Laborers work eight hours a day Monday through Friday, which does not include time for lunch since it is not paid. They receive two weeks of paid vacation, but six paid holidays. If your calculation results in a partial person, remember that you will have to round up to a whole number. You do not intend to hire any part-time labor.
3. (3 points) Determine the annual cost for direct labor (including benefits). Do not round.
4. (2 points) What is the direct labor cost per finished product? Do not round.
5. Cost identification.
The following accounts are to be used in 5a-5e:
Account Name
Annual Amount
Office Supplies
$500
Factory Utilities
$2400
Sales Commissions
$40000
Factory Equipment Depreciation
$500
Factory Rent
$5000
Advertising
$12000
Factory Manager
Account Name
Annual Amount
Office Supplies
$500
Factory Utilities
$2400
Sales Commissions
$40000
Factory Equipment Depreciation
$500
Factory Rent
$5000
Advertising
$12000
Factory Manager
Explanation / Answer
The Internal Revenue Service issued Fact Sheet 2006-20, Business Income and the Tax Gap, as the first in a series of fact sheets aimed at educating the public about components of the Tax Gap. Fact Sheet 2006-20 provided an overview of the Tax Gap and discussed in depth one of its main contributing components: business income.
This, the second in a series fact sheets on the tax gap, explains the rules regarding one factor used to determine business gross profit: Cost of goods sold (COGS).
Generally, businesses that make or buy goods to sell may deduct the cost of goods sold from their gross receipts in computing business income. This information applies if the business is a manufacturer, wholesaler or retailer, or if engaged in any business that makes, buys or sells goods to produce income.
This information generally does not apply to personal service businesses, such as doctors, lawyers, carpenters or painters except for personal service businesses that sell or charge for the materials and supplies normally used in the course of business.
Businesses that must account for an inventory generally use an accrual method of accounting for income as well as expenses.
The following items need to be taken into consideration when computing COGS: