(2) The NTPU Company manufactures tables. In March, the two production departments had budgeted allocation bases of 4,000 machine-hours in Assembly Department and 8,000 direct manufacturing labor-hours in Quality Control Department. The budgeted manufacturing overheads for the month were $57,500 and $62,500, respectively. For Job A, the actual costs incurred in the two departments were as follows:

| | Assembly Department | Quality Control Department |
| --- | --- | --- |
| Direct materials purchased on account | $110,000 | $177,500 |
| Direct materials used | 32,500 | 13,500 |
| Direct manufacturing labor | 52,500 | 53,500 |
| Indirect manufacturing labor | 11,000 | 9,000 |
| Indirect materials used | 7,500 | 4,750 |
| Lease on equipment | 16,250 | 3,750 |
| Utilities | 1,000 | 1,250 |

Job A incurred 800 machine-hours in Assembly Department and 300 manufacturing labor-hours in Quality Control Department. The company uses a budgeted overhead rate for applying overhead to production.

Requirement:

(a) Prepare the necessary journal entries to summarize the March transactions for Assembly Department.
(b) Determine the total cost of Job A.

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國立臺北大學 114 學年度碩士班一般入學考試試題

系(所)組別：會計學系

科 目：成本與管理會計學

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3. ELO Company is considering the purchase of new equipment that will reduce labor costs. ELO made the following estimates related to the new equipment:

| Cost of the equipment | $ 120,000 |
| --- | --- |
| Reduced annual labor costs | $ 50,000 |
| Estimated life of the equipment | 3 years |
| Terminal disposal value | $ 0 |
| Tax rate | 30% |
| Cost of capital | 10% |

Assume depreciation is calculated on a straight-line basis. All cash flows occur at the end of the year except for the initial investment amounts.

Required:

(1) What is the increase in the annual cash flow from investing the equipment? (8%)