Calculate each company’s net cash flow | Accounting homework help

Paper Details

Companies Alpha and Beta are very similar. Both have sales of $2,000,000, and COGS are 65% of sales. Both companies have operating expense of $300,000 and are taxed at 32%. However, Alpha and Beta will be claiming $30,000 and $60,000 each respectively in depreciation expense. Calculate each company’s net cash flow, and explain specifically the difference in the cash flows?

Production workers for Weik Manufacturing Company provided 3,600 hours of labor in January and 1,900 hours in February. The company, whose operation is labor intensive, expects to use 32,000 hours of labor during the year. Weik paid a $40,000 annual premium on July 1 of the prior year for an insurance policy that covers the manufacturing facility for the following 12 months.
Required
Explain why allocation is needed. Based on this information, how much of the insurance cost should be allocated to the products made in January and to those made in February?