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The LaGrange Corporation had the following budgeted sales for the first half of the current year: Problem Info     Cash Sales   Credit Sales January $ 70,000 $ 340,000 February $ 50,000 $ 190,000 March $ 40,000 $ 135,000 April $ 35,000 $ 120,000 May $ 45,000 $ 160,000 June $ 40,000 $ 140,000   The company is in the process of preparing a cash budget and must determine the expected cash collections by month. To this end, the following information has been assembled: Collections on sales: 60% in month of sale 30% in month following sale 10% in second month following sale The accounts receivable balance on January 1 of the current year was $70,000, of which $50,000 represents uncollected December sales and $20,000 represents uncollected November sales. The total cash collected during January by LaGrange Corporation would be:

Your Grandma can’t believe you are going to pay $25,000 for a new car.  She thinks a vehicle should only be $5,000 because that is what she paid for her first car.  Behavioral economists would say she is using __________________ to determine value.

Matt Company uses activity-based costing. The company has three products: A, B and C. The annual production and sales of Product A is 8,000 units, Product B is 6,000 units and Product C is 4,000 units. There are three activity cost pools, with total cost and total activity as follows: Problem Info       Total Activity   Activity Cost Pool Total Cost Product A Product B Product C Activity 1 $20,000 100 400 500 Activity 2 $37,000 800 200 1,000 Activity 3 $91,200 800 3,000 3,800 The activity-based costing cost per unit of Product A is

Sardi Inc. is considering whether to continue to make a component or to buy it from an outside supplier. The company uses 17,000 of the components each year. The unit product cost of the component according to the company’s cost accounting system is given as follows: Problem Info Item Amount   Direct materials $ 8.20   Direct labor   8.30   Variable manufacturing overhead   1.20   Fixed manufacturing overhead   4.30   Unit product cost $ 22.00   Assume that direct labor is a variable cost. Of the fixed manufacturing overhead, 70% is avoidable if the component were bought from the outside supplier. In addition, making the component uses 2 minutes on the machine that is the company’s current constraint. If the component were bought, time would be freed up for use on another product that requires 4 minutes on this machine and that has a contribution margin of $7.00 per unit. When deciding whether to make or buy the component, what cost of making the component should be compared to the price of buying the component?

The Cook Corporation has two divisions–East and West. The divisions have the following revenues and expenses:   Problem Info   East West   Sales $ 500,000   $ 550,000   Variable costs   200,000     275,000   Traceable fixed costs   150,000     180,000   Allocated common corporate costs   135,000     170,000   Net operating income (loss) $ 15,000   $ (75,000 )   The management of Cook is considering the elimination of the West Division. If the West Division were eliminated, its traceable fixed costs could be avoided. Total common corporate costs would be unaffected by this decision. Given these data, the elimination of the West Division would result in an overall company net operating income (loss) of:

Vandenheuvel Corporation keeps careful track of the time required to fill orders. The times recorded for a particular order appear below:   Problem Info   Hours Move time 2.4 Wait time 18.2 Queue time 6.8 Process time 1.8 Inspection time 0.3   The manufacturing cycle efficiency (MCE) was closest to:

Would the following activities at a manufacturer of canned soup be best classified as unit-level, batch-level, product-level, or organization-sustaining activities?   Problem Info   Researching new processing methods Shipping orders to grocery stores A) Organization-sustaining Unit B) Batch Batch C) Product Unit D) Organization-sustaining Batch  

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A business owner is choosing between forming a C Corporation or an S Corporation. If the business earns $200,000 in net income and the owner is in the 37% marginal tax bracket, which of the following is true regarding the taxation of the S Corporation?

Andrea (37 years old) and David Lopez (36 years old) are married filing a joint return. In 2025, Andrea earned a salary of $115,000 and David’s salary was $44,000. David also has a small carpentry business on the side which generated $15,000 in net qualified business income (structured as an S-Corporation). Their only other sources of income in 2025 were $800 in interest from a savings account and $7,000 in alimony David received from a previous marriage (divorce decree finalized in 2020). The Lopez’s also incurred the following expenses during 2025: Capital loss on sale of stock $5,000 State income taxes  $12,000 Mortgage interest $19,000 Medical expenses $3,600 Charitable contributions $2,000 The Lopez’s have one qualifying child, who qualifies them for a $2,200 child tax credit. The Lopez’s collectively had $16,000 income taxes withheld from their paychecks. Compute the Lope’s tax due/(refund) for 2025 (Appendix C – Tax Rate Schedule) SHOW YOUR WORK! If you wish to submit a file with your work, please do so in the last question to the exam. Otherwise, utilize the space provided below.