Answer:
Fixed costs= 510
Explanation:
Giving the following information:
Month Maintenance Expense Machine Hours
1 $ 3,480 2,380
2 3,670 2,480
3 3,850 2,580
4 3,980 2,610
5 3,980 2,460
6 4,400 2,620
7 3,970 2,600
8 3,780 2,570
9 3,500 2,390
10 3,120 2,260
11 2,960 1,650
12 3,240 2,250
To calculate the fixed costs, we need to use the following formulas:
Variable cost per unit= (Highest activity cost - Lowest activity cost)/ (Highest activity units - Lowest activity units)
Variable cost per unit= (4,400 - 2,960) / (2,620 - 1,650)
Variable cost per unit= $1.484536
Fixed costs= Highest activity cost - (Variable cost per unit * HAU)
Fixed costs= 4,400 - (1.484536*2,620)
Fixed costs= $510
Fixed costs= LAC - (Variable cost per unit* LAU)
Fixed costs= 2,960 - (1.484536*1,650)
Fixed costs= 510
Other things the same, an increase in the U.S. interest rate causes U.S. net capital outflow to a. rise, so supply in the market for foreign-currency exchange shifts right. b. rise, so demand in the market for foreign-currency exchange shifts right. c. fall, so supply in the market for foreign-currency exchange shifts left.
Answer:
b. rise, so demand in the market for foreign-currency exchange shifts right.
Explanation:
An increase in the interest rates leads to a rise in the capital outflow as savings and investment lead to more net capital outflow. This is the movement of the assets on the company and is considered to be bad for the economy and leads to undesirable changes in the supply of the foreign currency as a shift in the demands of the consumers. This may result in political and economic instability.Foster Manufacturing uses a job order cost accounting system. On April 1, the company has Work in Process Inventory of $7,600 and two jobs in process: Job No. 221, $3,600, and Job No. 222, $4,000. During April, a summary of source documents reveals the following:
For Materials Requisition Slips Labor Time Tickets
Job No. 221 $1,200 $1,600
222 1,700 2,200
223 2,400 2,900
224 2,600 2,800
General use 600 400
Totals $8,500 $9,900
Foster applies manufacturing overhead to jobs at an overhead rate of 70% of direct labor cost. Job No. 221 is completed during the month.
Required:
Prepare summary journal entries to record the raw materials requisitioned, factory labor used, the assignment of manufacturing overhead to jobs, and the completion of Job No. 221.
Answer:
Foster Manufacturing
Journal Entries
Sr. No Particulars Debit Credit
1 Work in Process Job No. 221 1200
Work in Process Job No. 222 1700
Work in Process Job No. 223 2400
Work in Process Job No. 224 2600
Factory Overhead Indirect Materials 600
Materials Inventory 8500
Materials Requisitioned to specific jobs work in process inventory.
2. Direct Labor Work in Process Job No. 221 1600
Direct Labor Work in Process Job No. 222 2200
Direct Labor Work in Process Job No. 223 2900
Direct Labor Work in Process Job No. 224 2800
Indirect Labor 400
Payroll 9500
Factory OverheadControl 400
Direct Labor used for specific jobs.
3. Work in Process Job No. 221 1120
Work in Process Job No. 222 1540
Work in Process Job No. 223 2030
Work in Process Job No. 224 1960
Manufacturing Overheads 6930
Manufacturing Overheads applied to specific jobs at the rate of 70%.
4. Finished Goods Inventory $ 7940
Opening Work in Process Job No. 221 3600
Work in Process Job No. 221 Materials 1200
Work in Process Job No. 221 Direct Labor 1600
Work in Process Job No. 221 MOH 1540
Job 221 completed and transferred to finished goods.
Statement of Cash Flows—Indirect Method
The comparative balance sheet of Harris Industries Inc.
at December 31, 20Y4 and 20Y3, is as follows:
Dec. 31, 20Y4 Dec. 31, 20Y3
Assets
Cash $443,240 $360,920
Accounts receivable (net) 665,280 592,200
Inventories 887,880 1,022,560
Prepaid expenses 31,640 25,200
Land 302,400 302,400
Buildings 1,713,600 1,134,000
Accumulated depreciation—buildings (466,200) (414,540)
Machinery and equipment 781,200 781,200
Accumulated depreciation— (214,200) (191,520)
machinery and equipment
Patents 106,960 112,000
Total assets $4,251,800 $3,724,420
Liabilities and Stockholders' Equity
Accounts payable (merchandise creditors)$837,480 $927,080
Dividends payable 32,760 25,200
Salaries payable 78,960 87,080
Mortgage note payable, due in nine years 224,000 0
Bonds payable 0 390,000
Common stock, $5 par 200,400 50,400
Paid-in capital: Excess of issue price 366,000 126,000
over par—common stock
Retained earnings 2,512,200 2,118,660
Total liabilities and stockholders' equity $4,251,800 $3,724,420
An examination of the income statement and the accounting records revealed the following additional information applicable to 20Y4:
Net income, $524,580.
Depreciation expense reported on the income statement: buildings, $51,660; machinery and equipment, $22,680.
Patent amortization reported on the income statement, $5,040.
A building was constructed for $579,600.
A mortgage note for $224,000 was issued for cash.
30,000 shares of common stock were issued at $13 in exchange for the bonds payable.
Cash dividends declared, $131,040.
Required:
Prepare a statement of cash flows, using the indirect method of presenting cash flows from operating activities. Use the minus sign to indicate cash out flows, cash payments, decreases in cash, or any negative adjustments
Answer:
Statement of Cash Flows
Cash flow From Operating Activities
Net income $524,580
Adjustment for Non Cash Items :
Depreciation expense - buildings $51,660
Depreciation expense - machinery and equipment $22,680
Patent amortization $5,040
Adjustments for Changes in Working Capital Items :
Increase in Accounts receivable -$73,080
Decrease in Inventories $134,680
Increase in Prepaid expenses -$6,400
Decrease in Accounts payable -$89,600
Net Cash From Investing Activities $569,540
Cash flow From Investing Activities
Buildings -$579,600
Net Cash From Investing Activities -$579,600
Cash flow From Financing Activities
Mortgage Note $224,000
Dividends Paid -$123,480
Net Cash From Financing Activities $100,520
Movement during the year $82,320
Cash and Cash Equivalents at beginning of the year $360,920
Cash and Cash Equivalents at end of the year $443,240
Explanation:
For Determination of Dividends Paid, open a Dividends Paid Account as follows :
Debit:
Cash (Balancing figure) 123,480
Balance c/d 32,760
Totals 156,240
Credit
Balance b/d 25,200
Dividends Declared 131,040
Totals 156,240
A store sells 20 ice cream bars per hour for $4 each, but on discount days, it sells 35 ice cream bars per hour for $3. Based on these two data points, what would be the slope for the relationship between the price and the quantity of ice cream sold?
Answer:
The slope for the relationship between the price and the quantity of ice cream sold would be of -1/15
Explanation:
In order to calculate the slope for the relationship between the price and the quantity of ice cream sold we would have to calculate the following formula:
Slope= change in yaxis( vertical)/change in xaxis(horizontal)
Slope= change in price/change in quantity demand
Slope=P2-P1/Q2-Q1
Slope=3-4/35-20
Slope=-1/15
The slope for the relationship between the price and the quantity of ice cream sold would be of -1/15
Ivory Corporation, a calendar year, accrual method C corporation, has two cash method, calendar year shareholders who are unrelated to each other. Craig owns 35% of the stock, and Oscar owns the remaining 65%. During 2019, Ivory paid a salary of $100,000 to each shareholder. On December 31, 2019, Ivory accrued a bonus of $25,000 to each shareholder. Assuming that the bonuses are paid to the shareholders on February 1, 2020, compute Ivory Corporation's 2019 deduction for the above amounts.
Answer:
$225,000
Explanation:
Computation for Ivory Corporation's 2019 deduction for the above amounts.
In a situation where a Corporation uses the accrual method such Corporation cannot in any way claim a deduction for an accrual with respect to a related party reason been that the recipient have to reports the amount as income.
Therefore Ivory Corporation cannot deduct the $25,000 bonus which was attributable to Oscar because Oscar is the related party until the year 2018.
Ivory Corporation should go ahead and deduct in 2017 the salary payments which is been made to each shareholder plus the accrued bonus to Craig, or $225,000
Salary of $100,000 + Salary of $100,000 + $25,000 bonus
$225,000
Managers in international businesses will need to evaluate the attractiveness of a country as a market or location for a facility or investment. Knowing how to think about events and situations will help the manager make that evaluation?
Countries with democratic regimes, market-based economic policies, and strong protection of property rights are more likely to attain high and sustained economic growth rates, and are thus a more attractive location for international business. The benefits, costs, and risks are associated with the political, economic, and legal systems of the country. The overall attractiveness of a country depends on balancing the benefits, costs, and risks.
Drag each item to the appropriate category of evaluations a manager must make when examining a country's attractiveness.
1. Middle-class population growth potential
2. First-mover advantages
3. Bribe payments
4. Unaxpestec political change
5. Infrastructure issuos
6. Resolving contract disputes
7. Free market economy
8. Economio uncertainty
A. Evaluate Benefits
B. Evaluate Costs
C. Evaluate Risks
Answer: Please refer to Explanation
Explanation:
When Evaluating a country's attractiveness for investment, there are several factors that should be evaluated. Key amongst them are, Benefits, Costs and Risks.
Under Benefits, the economy is evaluated based on the benefits it brings to the table. It's strengths and Opportunities. The goal is to see if these benefits present the company with adequate enough incentives to want to invest.
Under Costs, the cost of setting up and thriving is evaluated. What does the company have to pay and who do they have to pay it to in order to set up properly.
Under Threats, the factors that could adversely affect the company as a result of Investing in the country are evaluated. This is very important to know so that if need be, contingencies can be established.
Classifying the above.
1. Middle-class population growth potential. EVALUATE BENEFITS.
The middle class are the main purchasers of goods and services in the economy. In evaluating benefits the potential growth rate of the middle class should be evaluated.
2. First-mover advantages. EVALUATE BENEFITS.
Evaluating the potential benefits to be had from investing first in a country is part of Benefits Evaluation.
3. Bribe payments. EVALUATE COSTS.
Bribery payments are a cost when it comes to setting up in corrupt nations. They need to be evaluated as costs.
4. Unexpected political change. EVALUATE RISKS.
Under the evaluation of risks, this should be evaluated because a new Political leadership could have a different attitude to the company and this is a threat.
5. Infrastructure issues. EVALUATE COSTS.
Under the evaluation of cost there must be an evaluation of infrastructural issues in the country. If there are infrastructural challenges, the cost of setting up will be higher because depending on the infrastructure you'd have to bring in infrastructure from other areas and that would be expensive.
6. Resolving contract disputes. EVALUATE COSTS.
What are the costs of resolving contract disputes in the country. If they are favourable then the country is fine.
7. Free market economy. EVALUATE BENEFITS.
A free Market Economy is very useful to Entreprise. The type of economy needs to be evaluated therefore to see if it is a Free Market Economy that can benefit the company.
8. Economic uncertainty. EVALUATE RISKS.
How stable is the economy of the country in question. A country with an unstable Economy is one with a lot of Uncertainty and any company going in there will have to risk suffering losses if the Economy goes through peril.
Balance sheet The balance sheet provides a snapshot of the financial condition of a company. Investors and analysts use the information given on the balance sheet and other financial statements to make several interpretations regarding the company's financial condition and performance.
Cold Goose Metal Works Inc. is a hypothetical company. Suppose it has the following balance sheet items reported at the end of its first year of operation. For the second year, some parts are still incomplete. Use the information given to complete the balance sheet.
Cold Goose Metal Works Inc. Balance Sheet for Year Ending December 31 (Millions of Dollars)
Year 2 Year 1 Year 2 Year 1
Assets Liabilities and equity
Current assets: Current liabilities
Cash and equivalents $4,612 Accounts payabl $0 $0
Accounts receivable 2,109 1.688 Accruals 293 293 0
Inventories 6,187 4,950 Notes par 1,660 1,562
Total current assets $14,062 $11,250 Total current abilities $1,562
Net fixed assets: Long-term debt 5,859 4,688
Net plant and equipment $13.750 Total debt $7,812 $6,250
Conon equity
Common stock 15.235 12,188
Retained earnings 6,562
Total common equity $23,438 $18,750
Total assets $31,250 $25,000 Total abilities and equity $31,250 $25,000
Given the information in the preceding balance sheet—and assuming that Cold Goose Metal Works Inc. has 50 million shares of common stock outstanding—read each of the following statements, then identify the selection that best interprets the information conveyed by the balance sheet.Statement #1: Cold Goose’s pool of relatively liquid assets, which are available to support the company’s current and future sales, decreased from Year 1 to Year 2.This statement is , because:Cold Goose’s total current asset balance increased from $11,250 million to $14,062 million between Year 1 and Year 2Cold Goose’s total current liabilities balance increased from $1,688 million to $2,109 million between Year 1 and Year 2Cold Goose’s total current liabilities balance decreased by $2,812 million between Year 1 and Year 2Statement #2: Over the past two years, Cold Goose Metal Works Inc. has relied more on the use of short-term debt than on long-term debt financing.This statement is , because:Cold Goose’s total current liabilities increased by $391 million, while its use of long-term debt increased by $1,171 millionCold Goose’s total current liabilities decreased by $391 million, while its long-term debt account decreased by $1,171 millionCold Goose’s total notes payable increased by $98 million, while its common stock account increased by $3,047 millionStatement #3: One way to interpret the change in Cold Goose’s accounts receivable balance from Year 1 to Year 2 is that more customers purchased new items on credit rather than paying off existing credit accounts.This statement is , because:The $421 increase in accounts receivable means either that Year 1’s existing credit customers are not paying off their owed balances and new or existing customers are making additional purchases on credit, or that Year 1’s credit customers have repaid their owed balances and Year 2 credit sales have exceeded Year 1’s credit salesThe decrease from $2,109 million to $1,688 million implies a net decrease in accounts receivable and that more customers are paying off their receivables balances than are buying on creditThe change from $4,950 million to $6,187 million reflects a net accumulation of new credit salesBased on your understanding of the different items reported on the balance sheet and the information they provide, if everything else remains the same, then the cash and equivalents item on the current balance sheet is likely to if the firm buys a new plant and equipment at a cost of $1 million with liquid capital.
Answer:
Cold Goose Metal Works Inc.
Balance Sheet
For Year Ending December 31 (Millions of Dollars)
Year 2 Year 1
Assets
Current assets:
Cash and equivalents $5,766 $4,612
Accounts receivable 2,109 1.688
Inventories 6,187 4,950
Total current assets $14,062 $11,250
Net fixed assets:
Net plant and equipment $17,188 $13.750
Total assets $31,250 $25,000
Liabilities and Equity
Current liabilities:
Accounts payable $0 $0
Accruals 293 0
Notes payable 1,660 1,562
Total current abilities $1,953 $1,562
Long-term debt 5,859 4,688
Total debt $7,812 $6,250
Common equity
Common stock 15.235 12,188
Retained earnings $8,203 6,562
Total abilities and equity $31,250 $25,000
Statement #1: Cold Goose’s pool of relatively liquid assets, which are available to support the company’s current and future sales, decreased from Year 1 to Year 2.
This statement is FALSE, because: Cold Goose’s total current asset balance increased from $11,250 million to $14,062 million between Year 1 and Year 2
Statement #2: Over the past two years, Cold Goose Metal Works Inc. has relied more on the use of short-term debt than on long-term debt financing.
This statement is FALSE, because: Cold Goose’s total current liabilities increased by $391 million, while its use of long-term debt increased by $1,171 million
Statement #3: One way to interpret the change in Cold Goose’s accounts receivable balance from Year 1 to Year 2 is that more customers purchased new items on credit rather than paying off existing credit accounts.
This statement is TRUE, because:The $421 increase in accounts receivable means either that Year 1’s existing credit customers are not paying off their owed balances and new or existing customers are making additional purchases on credit, or that Year 1’s credit customers have repaid their owed balances and Year 2 credit sales have exceeded Year 1’s credit sales
Based on your understanding of the different items reported on the balance sheet and the information they provide, if everything else remains the same, then the cash and equivalents item on the current balance sheet is likely to DECREASE if the firm buys a new plant and equipment at a cost of $1 million with liquid capital.
Which of the following statements is CORRECT? a. If a company follows a policy of "matching maturities," this means that it matches its use of short-term debt with its use of long-term debt. b. If a company follows a policy of "matching maturities," this means that it matches its use of common stock with its use of long-term debt as opposed to short-term debt. c. Net working capital is defined as current assets minus the sum of payables and accruals, and any decrease in the current ratio automatically indicates that net working capital has decreased. d. Although short-term interest rates have historically averaged less than long-term rates, the heavy use of short-term debt is considered to be an aggressive strategy because of the inherent risks associated with using short-term financing. e. Net working capital is defined as current assets minus the sum of payables and accruals, and any increase in the current ratio automatically indicates that net working capital has increased.
Answer: d. Although short-term interest rates have historically averaged less than long-term rates, the heavy use of short-term debt is considered to be an aggressive strategy because of the inherent risks associated with using short-term financing.
Explanation:
Using short term financing is generally considered to be an aggressive strategy and is more often than not frowned upon by investors.
This is because of the reputational risk involved. A company that keeps using short term financing gives off the impression that it is barely keeping afloat and therefore relying on short term loans to continue functioning.
Other risks involved include, short term loans are usually given in small quantities so they cannot be used effectively as they will bareky go anywhere in terms of investment and their payback installment schedule can be in weeks instead of months like long term financing which can be detrimental to survival.
This is as opposed to a Conservative Approach that uses long term financing to finance most of it's Working Capital.
Dell Computer buys computer chips from Intel for the purpose of making computers to be sold to consumers and other organizations. Dell is an example of which type of organizational buyer?
a. Intermediary
b. Producer
c. Wholesaler
d. Institution
Answer:
b. Producer.
Explanation:
Organizational buying deals with the process of purchasing products and services after duly identifying, evaluating and choosing which company to buy from.
Organizational buying is mainly classified into four categories, these are;
1. Producer.
2. Intermediary or Retailers.
3. Wholesaler.
4. Institution.
In this scenario, Dell Computer buys computer chips from Intel for the purpose of making computers to be sold to consumers and other organizations. Dell is an example of a producer organizational buyer because it bought computer chips, so it can be used to manufacture a computer.
Hence, the producers usually buy raw materials, components or other parts, from other manufacturers to use in producing goods for their consumers or end users.
Assume the company is considering investing in a new machine that will increase its fixed costs by $36,000 per year and decrease its variable costs by $10 per unit. Prepare a forecasted contribution margin income statement for 2018 assuming the company purchases this machine
Answer:
Find below complete question:
Hudson Co. reports the contribution margin income statement for 2017. Assume sales remain constant at 10.000 units.
HUDSON CO.
Contribution Margin Income Statement
For Year Ended December 31, 2017
Sales (10,000 units at $244 each) $2,440,000
Variable costs (10,000 units at $195 each) $1,950,000
Contribution margin $490,000
Fixed costs $327,600
Pretax Income $162,400
Assume the company is considering investing in a new machine that will increase its fixed costs by $36,000 per year and decrease its variable costs by $10 per unit.
Prepare a forecasted contribution margin income statement for 2018 assuming the company purchases this machine
The new pretax income is $226,400 compared to 2018 $162,400,which implies that investing in the new machine is viable
Explanation:
The forecast contribution margin income statement for 2018 is prepared below with fixed costs of $36,000 added to the previous cost of $327,600 while variable cost per unit drops by $10 to $185 per unit
Hudson Co,forecast contribution margin income statement for 2018
Sales (10,000*$244) $2,440,000
variable cost(10,000*$185) ($1,850,000)
Contribution margin $590,000
fixed costs( $327,600+$36,000) ($ 363,600)
Pretax income $ 226,400
A consumer has $130 in monthly income to be spent on two goods Z and B. The price of good Z (Pz) is $8.00. The Marginal Rate of Transformation (MRT) is equal to minus−2. That is 2 units of good B can be traded for 1 unit of good Z. What is the price of good B in $?
Answer:
Price of B is $4
Explanation:
Marginal rate of transformation is defined as the amount of a good x has to stop being produced inorder to produce a certain amount of a good y. Factors of production and technology used are assumed to be constant.
In this scenario the marginal rate of transformation is -2, that is 2 units of good B can be traded for 1 unit of good Z, mathematically
2 * Pb = Pz
Substitute price of Z
2* Pb = $8
Pb= 8 ÷ 2
On= $4
Henry Corporation bases its predetermined overhead rate on the estimated machine-hours for the upcoming year. At the beginning of the most recently completed year, the company estimated the machine-hours for the upcoming year at 20,000 machine-hours. The estimated variable manufacturing overhead was $9 per machine-hour and the estimated total fixed manufacturing overhead was $600,000. The predetermined overhead rate for the recently completed year was closest to:__________
Answer:
Estimated manufacturing overhead rate= $39 per machine hour
Explanation:
Giving the following information:
Estimated machine-hours= 20,000
The estimated variable manufacturing overhead was $9 per machine-hour.
The estimated total fixed manufacturing overhead was $600,000.
To calculate the estimated manufacturing overhead rate we need to use the following formula:
Estimated manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Estimated manufacturing overhead rate= (600,000/20,000) + 9
Estimated manufacturing overhead rate= $39 per machine hour
You would like to combine a risky stock with a beta of 1.87 with U.S. Treasury bills in such a way that the risk level of the portfolio is equivalent to the risk level of the overall market. What percentage of the portfolio should be invested in the risky stock
Answer:
46.5%
Explanation:
The treasury bills have zero beta as they have no systematic risk. Beta is used in the Capital asset pricing Model to demonstrate a relationship between systematic risk and rate of return.
Expected Return = Rf + Beta * Rp
The percentage that should be invested in the risky portfolio will be,
1 - 1 / Beta
1 - 1 / 1.87
= 46.5%
FICO is a. a company that analyzes consumer credit histories. b. a measure of your debt-to-income ratio. c. a special introductory interest rate on any purchases made during the holiday shopping season. d. a federal agency charged with monitoring consumer spending habits.
Answer: a. a company that analyzes consumer credit histories.
Explanation: The Fair Isaac Corporation (FICO) founded in 1956 by Bill Fair and Earl Isaac is a data analytics company and also the first company to offer a credit-risk model with a score. In other words, the FICO model is the primary method used for determining an individual's creditworthiness and in the provision of a credit rating or score.
They also offer credit scores for sales, either alone or as part of a package of products.
Culver Company has four operating divisions. During the first quarter of 2017, the company reported aggregate income from operations of $205,100 and the following divisional results. Division I II III IV Sales $250,000 $198,000 $499,000 $446,000 Cost of goods sold 198,000 191,000 298,000 254,000 Selling and administrative expenses 74,900 63,000 63,000 46,000 Income (loss) from operations $ (22,900) $ (56,000) $138,000 $146,000 Analysis reveals the following percentages of variable costs in each division. I II III IV Cost of goods sold 69 % 90 % 80 % 74 % Selling and administrative expenses 41 62 52 58 Discontinuance of any division would save 50% of the fixed costs and expenses for that division. Top management is very concerned about the unprofitable divisions (I and II). Consensus is that one or both of the divisions should be discontinued.
Answer:
Income after discontinuing operations from both departments 1 and 2 is greateri.e. $ 207 444 than income after discontinuing operations from department 1 . i.e. $ 172964
Explanation:
Option 1:
If the 1st division is discontinued. 50 % of the fixed costs and expenses will continue and included in irrelevant costs.
Culver Company
Income Statement
For the 1st Quarter 2017
Division II III IV Irrelevant Costs
Sales $198,000 $499,000 $446,000
Cost of G. Sold 191,000 298,000 254,000
V. COGS 90 % 80 % 74 %
V.COGS 171,900 238,400 187960
FIxed COGs 19,100 59600 66,040 30690
Selling &
Administrative Exps 63,000 63,000 46,000
Var. S& Admin Exps. 62% 52% 58%
Var. S& Admin Exps. 39060 32760 26,680
Fixed S.& Admin Exps 23940 30240 19320 24346
Income (loss) $ (56,000) $138,000 $146,000
Total Income = $ (56,000)+$138,000+$146,000-30690- 24346
Total Income= $ 172964
Option 2:
If both the 1st and 2nd division are discontinued. 50 % of the fixed costs and expenses are added under the section II.
Culver Company
Income Statement
For the 1st Quarter 2017
Division II III IV Irrelevant Costs
Sales $499,000 $446,000
Cost of G. Sold 298,000 254,000
V. COGS 80 % 74 %
V.COGS 238,400 187960
FIxed COGs 9,550 59600 66,040 30690
Selling &
Administrative Exps 63,000 46,000
Var. S& Admin Exps. 52% 58%
Var. S& Admin Exps. 32760 26,680
Fixed S.& Admin Exps 11970 30240 19320 24346
Income (loss) $138,000 $146,000
Total Income = $138,000+$146,000-30690- 24346- 9,550 - 11970
Total Income= $ 207 444
We calculate the fixed and variable costs by multiplying with the given percentages and subtracting it from the total .
Culver Company
Income Statement
For the 1st Quarter 2017
Division I II III IV
Sales $250,000 $198,000 $499,000 $446,000
Cost of G. Sold 198,000 191,000 298,000 254,000
V. COGS 69 % 90 % 80 % 74 %
V.COGS 136,620 171,900 238,400 187960
FIxed COGs 61,380 19,100 59600 66,040
Selling &
Administrative Exps 74,900 63,000 63,000 46,000
Var. S& Admin Exps. 41% 62% 52% 58%
Var. S& Admin Exps. 30,709 39060 32760 26,680
Fixed S.& Admin Exps 48691 23940 30240 19320
Income (loss) $ (22,900) $ (56,000) $138,000 $146,000
Presented below are certain account balances of Paczki Products Co.Rent revenue$ 6,500Interest expense 12,700 Beginning retained earnings 114,400Ending retained earnings 125,000Dividend revenue 71,000 Sales returns and allowances 12,400 Allocation to noncontrolling interest 17,000 Sales discounts$ 7,800Selling expenses 99,400Sales revenue 390,000 Income tax expense 31,000 Cost of goods sold 184,400 Administrative expenses 82,500Instructions From the foregoing, compute the following: (a) total net revenue, (b) net income, and (c) income attributable to controlling stockholders.
Answer:
Kindly check attached picture for the detailed computations
An insurance company faces an ethical dilemma. A faulty computer program designed to evaluate insurance claims has been denying a high number of valid claims. A meeting has been arranged where senior management would decide how to handle the situation. The people at the table have varying views of what action to take and why.Han wants to report the error and reimburse the affected customers immediately because he believes he could end up being fired if the company's reputation suffers because of the issue. Jamila wants to report the error because it is the honest thing to do, and therefore necessary.After hearing his colleagues' opinions, Keith says he is willing to do whatever the more experienced managers in the group recommend.Several other managers believe the company should correct the problem going forward but not do anything about the customers who lost out on past payments.Assume the meeting ends with the managers deciding not to do anything about the customers who are owed money for past claims. Lori, an employee who was present in the meeting, disagrees with the decision and gives an anonymous tip to a newspaper reporter about the unethical behavior. Which of the following best describes the action taken by Lori?A) Unethical stanceB) WhistleblowingC) ShadowingD) RelativismE) Ethnocentrism
Answer: B) Whistleblowing
Explanation:
Whistleblowing is an act where someone in a company discloses unethical practices usually from the entity that they work in. It is a very risky thing to do because it could signal the end of one's career in a certain industry.
Whistleblowing however helps in contributing to entities staying ethical because they'd rather avoid the bad publicity that comes with it and this is why most companies have a whistleblowing policy to make it easier for people to come forward.
Whistleblowing can be done to the Government, the press or even the entity at fault itself.
Lori by giving an anonymous tip to the press about unethical behavior has engaged in Whistleblowing.
Examples of some well known Whistleblowers include, Edward Snowden and Chelsea Manning.
A clothing manufacturer produces clothing in five locations in the United States. In a move to vertical integration, the company is planning a new fabric production plant that will supply fabric to all five clothing plants. The clothing plants have been located on a coordinate system as follows: Location (X,Y) A 7,2 B 4,7 C 5,5 D 6,2 E 8,4 If the amount of fabric shipped to each plant are equal, what is the optimal location for the fabric plant?
Answer:
(6,4)
Explanation:
The computation of optimal location for the fabric plant is shown below:-
X Y
A 7 2
B 4 7
C 5 5
D 6 2
E 8 4
Total 30 20
[tex]\bar X = \frac{Total\ of\ X}{Total\ number\ of\ locations}[/tex]
[tex]\bar X = \frac{30}{5}[/tex]
= 6
[tex]\bar Y = \frac{Total\ of\ Y}{Total\ number\ of\ locations}[/tex]
[tex]\bar Y = \frac{20}{5}[/tex]
= 4
So, the optimal location for the fabric plant is (6,4)
Managers involved in negotiation should:__________.
1. Search for the absolute best answer.
2. Exercise premature judgment.
3. Realize that solving the other party's problem is actually the other party's problem.
4. Verify whether there is only a fixed set of alternatives.
Which of the following phenomena would be most likely to occur if the project team did not have clear and commonly understood project goals?
1. The level of trust among team members would increase.
2. The motivation level of team members would increase.
3. The interdependency among team members would increase.
4. Conflict among team members would increase.
Answer:
For question (1): 4. Verify whether there is only a fixed set of alternatives.
For question (2): 4. Conflict among team members would increase.
Explanation:
Managers involved in negotiation should always verify whether there is only a fixed set of alternatives.
It is ideal that when managers are making a negotiation and by extension decision-making, they should ensure there are one or more alternative options. A fixed set of alternatives would only mean they're absolutely liable to the other party, without any reasonable benefits to their organization in the event of a crisis with the deal.
Conflict among team members would increase if the project team did not have clear and commonly understood project goals.
As a rule and standard, it is necessary to ensure that team members share common understanding, aims, ideas and vision in order to achieve their project goals and objectives.
When team members are in sync, they're bound to collaborate and use collective intelligence to attain success.
Hence, to increase the level of trust, motivation level, and interdependency among team members, project managers should ensure they've clear and commonly understood project goals.
As discussed in the case and the text, W. L. Gore and Zappos adopted new organizational structures during periods of growth. In general, most firms follow a predictable pattern of structural change. Which of the following best exemplifies this pattern?
a. Simple to functional to multidivisional structures
b. Ambidextrous to functional to matrix structures
c. Functional to simple to matrix structures
d. Global to functional to multidivisional structures
e. Simple to matrix to functional structures
Answer: a. Simple to functional to multidivisional structures
Explanation:
An Organisational structure refers to how tasks flow in a company to enable them to achieve their goals.
As a company grows, they tend to go through different types of structures which fit their size and enable them to reach their goals better.
They generally start with the Simple Structure which is very common in smaller businesses. Here most decisions are centred on the owner. The owner as the proprietor is in charge of coming up with basically everything to push the business forward.
As the company grows they switch to a Functional Structure. This is when the company will be structured by function to enable better specialization and divisions of labour. Examples of separation by function include, IT Department, Marketing Department, Production Department etc.
If the growth continues the company finds it best to specialize even more and this is when Multidivisional Structures kick in. In a Multidivisonal Structure, the company divides itself into different divisions while maintaining a parent company. The Divisions are fairly independent and pursue different goals and products but all under the direction of the parent company. An example is Google splitting into divisions with Alphabet Inc being the Parent Company and Divisions such as Google, Calico, Deepmind and Waymo being created.
Bob Clarke Corporation has provided the following data from its activity-based costing system: Activities Estimated Overhead Cost Expected Activity Assembly $1,005,040 68,000 machine-hours Processing orders $102,500 2,000 orders Inspection $139,840 1,900 inspection-hours The company makes 450 hockey sticks a year, requiring a total of 710 machine-hours, 42 orders, and 12 inspection-hours per year. The product's direct materials cost is $36.42 per hockey stick and its direct labor cost is $30.16 per hockey stick. Required: 1. Calculate the unit product cost of one hockey stick according to the activity-based costing system (Round your final answer to two decimal places).
Answer:
Total Unit Cost= $ 96.65
Explanation:
Bob Clarke Corporation
Activities Estimated Overhead Cost Expected Activity
Assembly $1,005,040 68,000 machine-hours
Processing orders $102,500 2,000 orders
Inspection $139,840 1,900 inspection-hours
First we find the overhead rates using ABC costing method.
Overhead Rates= Estimated Overhead Cost/ Expected Activity
Assembly Rate= $1,005,040 /68,000 = $ 14.78 per machine-hours
Processing rate= $102,500 / 2,000= $ 51.25 per orders
Inspection Rate= $139,840/ 1,900= $ 73.6 per inspection-hours
Then we find the overhead costs applying the ABC Costing rates
Overhead Costs Of 450 Hockey
Assembly= 710 machine-hours, * $ 14.78= $10493.8
Processing=42 orders, *$ 51.25= $ 2152.5
Inspection= 12 inspection-hours*$ 73.6 = $ 883.2
Total Overhead Costs of 450 Hockey = $ 13529.5
Overhead Cost of One Hockey= 13529.5/450= 30.065= $ 30.07
Then the:
Product Cost
Direct materials cost is $36.42 per hockey stick
Direct labor cost is $30.16 per hockey stick
Overhead Costs is $ 30.07
Total Unit Cost= $ 96.65
Pasadena Candle Inc. budgeted production of 785,000 candles for January. Each candle requires molding. Assume that six minutes are required to mold each candle. If molding labor costs $18 per hour, determine the direct labor cost budget for January. Pasadena Candle Inc. Direct Labor Cost Budget For the Month Ending January 31 Hours required for assembly: Candles min. Convert minutes to hours ÷ min. Molding hours hrs. Hourly rate × $ Total direct labor cost
Answer:
Direct labour cost budget= $1,413,000.
Explanation:
The direct labor cost budget is a function of the production product budget. The quantity of the product budgeted to be produced would determine the labor cost budget.
Direct labour budget = Production budget × standard hours × standard labour rate per hour
Standard hour = 6/60 =0.1 (note there are 60 minutes in an hour)
Direct labour budget = 785,000 × 0.1× 18 = $1,413,000.
Direct labour cost budget= $1,413,000.
Public television periodically runs pledge drives to raise money. Only a small percentage of the people who benefit from public television are willing to pay. This low percentage of people willing to contribute illustrates a difficulty with:____________.
Answer
voluntary programs
Explanation:
voluntary programs or activities that are usually individual or people voluntarily participate in and they are not paid for it. sometimes, voluntary programs are made for profit and sometimes not for profit.
pledge drive is a vivid example of a voluntary program. sometimes, only some few public television are able to get donations to run their day to day program/activities. most times, the subscription will be an addition to others and also large source of revenue. most times the incentives to join and dangers of shirking is a problem affecting voluntary program
Colleague responsibilities related to compliance include which of the following:________. A. Report if you have been placed on a state or federal exclusion list B. Report if you have been convicted of a minor traffic violation C. Report when your employment-related professional licenses have been renewed D. Report when you complete annual continuing education
Answer:
A. Report if you have been placed on a state or federal exclusion list
Explanation:
While working in an organization you have some responsibilities which are related to compliance, integrity, honesty, etc are as follows
1. They have to report if they are placed on a state or federal exclusion list that also includes Officer of Inspector General (OIG), General Service Administration (GSA)
2. Instant report the criminal offense if you are convicted other than the minor traffic violation
The conviction excludes the following things
a. Arrest or charges
b. Judicially dismissed
c. That does not consider except felony convictions that also includes controlled substances should always be reported
hence, the correct option is a.
In a company, individuals have roles and responsibilities which should be fulfilled. It can include truthfulness, virtue, compliance's etc.
The correct answer is:
Option A. Report if you have been placed on a state or federal exclusion list.
This can be explained as:
The colleague should report if they were on the state or national exclusion list.The exclusion list can also contain General Service Administration or Officer of Inspector General.If the charges were other than minor traffic violations like criminal offences should be reported instantly.The convictions do not include charges, arrests, court dismissals etc.Therefore, if placed on the exclusion list should be reported.
To learn more about federal exclusion list follow the link:
https://brainly.com/question/25087292
Which of the following statements regarding changes in accounting principles is not true? Most changes in accounting principles are retroactively reported. Most changes in accounting principles are only reported in current periods when the principle change takes place. Changes in accounting principles are allowed when new principles are preferable to old ones. Consistency is one of the biggest concerns when a change in accounting principle is undertaken.
Answer:
Most changes in accounting principles are only reported in current periods when the principle change takes place.
Explanation:
Accounting principle can be defined as a general guideline to be followed by accountants or financial institutions when they record and report their financial transactions.
A change in an accounting principle involves a change in an accounting method used.
For instance, an accountant switching between First In, First Out (FIFO) to Last In, First Out (LIFO) method of inventory valuation or by using another depreciation method.
Additionally, an accounting principle should only be changed, if it's applicable to the accounting framework being used such as Generally Accepted Accounting Principles (GAAP) and International Financial Reporting Standards (IFRS).
Also, it is important to state in the footnotes of the financial statements a full disclosure to highlight the justification for the preferred change and financial implications of this change.
The following are true about the change in accounting principles;
1. Most changes in accounting principles are retroactively reported.
2. Changes in accounting principles are allowed when new principles are preferable to old ones.
3. Consistency is one of the biggest concerns when a change in accounting principle is undertaken.
Engineering Wonders reports net income of $63 million. Included in that number is building depreciation expense of $5.3 million and a gain on the sale of land of $1.3 million. Records reveal decreases in accounts receivable, accounts payable, and inventory of $2.3 million, $3.3 million, and $4.3 million, respectively. What are Engineering Wonders' net cash flows from operating activities? (List cash outflows and any decrease in cash as negative amounts. Enter your answer in millions. (i.e., $10,000,000 should be entered as 10).)
Answer:
70.3
Explanation:
The calculation of net cash flows from operating activities is shown below:-
Engineering Wonders reports
Net cash flow from operating activities
Particulars Amount
Net income 63
Adjustment to reconcile net
income to net cash
flow from operating activities
Add: Depreciation expense 5.3
Less: Gain on sale of land 1.3
Add: Decrease in Accounts
receivable 2.3
Less: Decrease in accounts
payable 3.3
Add: Decrease in inventory 4.3
Net cash flow from operating
activities 70.3
Therefore the net cash flow from operating activities is 70.3.
Bartel Corporation produces bar stools for restaurants.
1. For each of the following, indicate whether the cost would typically be considered direct or indirect cost for the cost object given.
A. Lubricants used on the bar stool manufacturing equipment.
B. The factory supervisor's salary for the bar stool factory.
C. The production labor wages for the bar stool assemblers.
D. Nails and screws used in the production of the bar stools.
E. Manufacturing costs for wood and steel used in the bar stools.
2. For each of the following, indicate whether the cost would typically be considered product or period cost for the cost object given.
A. Electricity costs to run the factory.
B. Accountant salaries.
C. Selling costs for the period.
D. Delivery costs to take the bicycles to stores.
E. Tires for the bicycles.
Answer: The answers are provided below
Explanation:
1. Direct cost are the major part of cost and can be traced to a cost object while indirect cost are typically small cost and difficult to trace to a specific cost object.
A. Lubricants used on the bar stool manufacturing equipment - indirect cost
B. The factory supervisor's salary for the bar stool factory - indirect cost
C. The production labor wages for the bar stool assemblers - direct cost
D. Nails and screws used in the production of the bar stools - direct cost
E. Manufacturing costs for wood and steel used in the bar stools - direct cost.
2. A manufacturer's product costs are direct labor, direct materials, and the manufacturing overhead that are used in making its products while the period costs are written as expenses in an accounting period. Period costs are associated with passage of time and examples include the general and administrative expenses, like rent, office supplies, office depreciation, and utilities
A. Electricity costs to run the factory - product cost
B. Accountant salaries - period cost
C. Selling costs for the period - period cost
D. Delivery costs to take the bicycles to stores - period cost
E. Tires for the bicycle - product cost
Sheridan Company uses the periodic inventory system. For the current month, the beginning inventory consisted of 485 units that cost $66 each. During the month, the company made two purchases: 725 units at $69 each and 364 units at $71 each. Sheridan Company also sold 1198 units during the month. Using the average cost method, what is the amount of ending inventory? (Round average cost per unit to 2 decimal places, e.g. 21.48.)
Answer:
Value of closing inventory = $25771.04
Explanation:
To calculate the value of ending inventory under a periodic average cost method, we will calculate the average price per unit of inventory at the end of the month. To calculate the average price per unit, we simply divide the total cost of the inventory by the total number of units for the month.
Average cost per unit = Total cost of all units for the month / Total units available for the month
Total cost of all units:
Beginning inventory (485 * 66) 32010
Purchase 1 (725 * 69) 50025
Purchase 2 (364 * 71) 25844
Total 107879
Total Units
Beginning Inventory 485
Purchase 1 725
Purchase 2 364
Total 1574
Average cost per unit = 107879 / 1574
Average cost per unit = $68.54
Units of closing inventory = 1574 - 1198 = 376 units
Value of closing inventory = 376 * 68.54
Value of closing inventory = $25771.04
A manager buys three shares of stock today, and then sells one of those shares each year for the next 3 years. His actions and the price history of the stock are summarized below. The stock pays no dividends.
Time Price Action
0 $190 Buy 3 shares
1 200 Sell 1 share
2 200 Sell 1 share
3 200 Sell 1 share
A. Calculate the time-weighted geometric average return on this "portfolio."
B. Calculate the time-weighted arithmetic average return on this portfolio.
C. Calculate the dollar-weighted average return on this portfolio.
Answer:
a. The Geometric average return is 1.72%
b. The Arithmetic average return is 1.75%
c. The Dollar weighted average return is 2.61%
Explanation:
a) In order to calculate the time-weighted geometric average return we would have to calculate first the Holding period return as follows:
Holding period return = (200 - 190) / 190 = 5.263%
Hence, Geometric average return = (1 + .05263)^(1/3) - 1 = 1.72%
b) To calculate time-weighted arithmetic average return we have to make the following calculation:
Arithmetic average return = 5.263% / 3 = 1.75%
c) To calculate time-weighted arithmetic average return we would have to make the following calculation:
Dollar weighted average return=-190*3 + 200/(1+r) + 200/(1+r)^2 + 200 / (1+r)^3 = 0
= 2.61%
Management is considering using a new component that would increase the unit variable cost by $50. Since the new component would improve the company's product, the marketing manager predicts that monthly sales would increase by 500 units. What should be the overall effect on the company's monthly net operating income of this change if fixed expenses are unaffected
Answer:
Because fixed costs will not change, the overall effect on the company's monthly net operating income will be equal to the contribution margin of the product once the new component is added.
Explanation:
The contribution margin is equal to: Revenue - Variable Costs.
We already know that the variable cost will be increased by $50 once new component is added, and that monthly sales are expected to increase by 500 units after that.
Depending on the price of the product, the amount sold, and the variable costs, we get the contribution margin, and this contribution margin will be exactly the same as the overall effect on the net operating income.
