! ! ! ! DrSharonLevinACCT221FinalExamF13Ver137481 ! Problem 1: 10 points Caballero Manufacturing incurs unit costs of $15 ($10 variable and $5 fixed) in making a sub-assembly part for its finished product. A supplier offers to make 20,000 of the assembly part at $13.75 per unit. If the offer is accepted, Caballero will save all variable costs but no fixed costs. Instructions: Part A) Prepare an analysis showing the total cost savings, if any, Caballero will realize by buying the part. Document Preview: ! ! ! ! DrSharonLevinACCT221FinalExamF13Ver137481 ! Problem 1: 10 points Caballero Manufacturing incurs unit costs of $15 ($10 variable and $5 fixed) in making a sub-assembly part for its finished product. A supplier offers to make 20,000 of the assembly part at $13.75 per unit. If the offer is accepted, Caballero will save all variable costs but no fixed costs. Instructions: Part A) Prepare an analysis showing the total cost savings, if any, Caballero will realize by buying the part. Part B) Caballero Company should _________ the part because total annual costs to make are _________ than total costs to buy. Problem 2: 10 points Ziray Corporation has the following cost records for November 2013. Indirect factory labor $ 5,107 Factory utilities $ 613 Direct materials used 24,826 Depreciation, factory equipment 1,499 Work in process, 11/1/13 3,267 Direct labor 33,052 Work in process, 11/30/13 3,633 Maintenance, factory equipment 1,958 Finished goods, 11/1/13 4,609 Indirect materials 2,749 Finished goods, 11/30/13 7,429 Factory managers salary 4,038 Instructions: Prepare a cost of goods manufactured schedule for November 2013. ! ! ! ! DrSharonLevinACCT221FinalExamF13Ver137481 (! Problem 3: 15 points Here are comparative balance sheets for Wilson Company. Wilson Company Comparative Balance Sheets December 31, 2013 Assets 2013 2012 Cash $ 44,550 $ 13,500 Accounts receivable 24,300 18,900 Inventories 33,750 24,300 Prepaid expenses 8,100 12,150 Long-term investments 0 24,300 Equipment 81,000 43,200 Accumulated depreciationEquipment (27,000) (18,900) Total assets $ 164,700 $ 117,450 Liabilities and Stockholders Equity Accounts payable $ 22,950 $ 9,450 Bonds payable 49,950 63,450 Common stock ($1 par) 54,000 31,050 Retained earnings 37,800 13,500 Total liabilities and stockholders equity $ 164,700 $ 117,450 Additional information: 1. The 2013 Income Statement reported $8,100 in depreciation expense, a $5,400 loss on sale of investments and Net income of $48,600. 2. Attachments: hand_problems.pdf