Answer:
$30
Explanation:
The computation of the contribution margin is shown below:
Contribution margin = Sales - Variable cost
where,
Sales = Units sold × Market price
= 15 units × $10
= $150
And,
Variable cost = Units sold × AVC
= 15 units × $8
= $120
Now placing these values to the above formula
= $150 - $120
= $30
We simply applied the above formula
Brief Exercise 8-5 Vaughn Company uses a periodic inventory system. For April, when the company sold 450 units, the following information is available. Units Unit Cost Total Cost April 1 inventory330$22$ 7,260 April 15 purchase380269,880 April 23 purchase 290 29 8,410 1,000 $25,550 Compute the April 30 inventory and the April cost of goods sold using the FIFO method. Ending inventory $ Cost of goods sold
Answer:
Results are below.
Explanation:
Giving the following information:
Units sold= 450 units
Units Unit Cost Total Cost
April 1 inventory= 330 units at $22
April 15 purchase= 380 units art $26
April 23 purchase= 290 units at $29
To calculate the ending inventory, first, we need to determine the number of units in ending inventory:
Ending inventory in units= 330 + 380 + 290 - 450= 550 units
Ending inventory FIFO= 290*29 + 260*26= $15,170
COGS= 330*22 + 120*26= $10,380
"All vice-presidents in the company drive a Mercedes. Since Eric is a vice-president, he must also drive a Mercedes." This argument is best considered
Answer:
This question is incomplete, the options are missing. The options are the following:
a) Inductive
b) Deductive
And the correct answer is the option B: Deductive.
Explanation:
To begin with, the term of "Deductive Reasoning", in the logic field, refers to the process that involves the reasoning from one or more statements (that are called premises) with the main purpose of reaching to a conclusion that is drawn from those premises in first place. So therefore that the arguement is best considered to be a deductive one due to the fact that the conclusion of Eric driving a Mercedes because is a vice-president and all the other vice-presidents do it is logically deducted from those facts (premises).
Minor Company installs a machine in its factory at the beginning of the year at a cost of $135,000. The machine's useful life is estimated to be 5 years, or 300,000 units of product, with a $15,000 salvage value. During its first year, the machine produces 64,500 units of product. Determine the machines' first year depreciation under the double-declining-balance method.
Answer:
Annual depreciation= $48,000
Explanation:
Giving the following information:
Purchasing price= $135,000
Salvage value= $15,000
Useful life= 5 years
To calculate the depreciation expense under the double-declining method, we need to use the following formula:
Annual depreciation= 2*[(book value)/estimated life (years)]
Annual depreciation= 2*[(135,000 - 15,000) / 5]
Annual depreciation= $48,000
Globus Autos sells a single product. 8 comma 3008,300 units were sold resulting in $ 84 comma 000$84,000 of sales revenue, $ 24 comma 000$24,000 of variable costs, and $ 18 comma 000$18,000 of fixed costs. If Globus reduces the selling price by $ 1.10$1.10 per unit, the new margin of safety is: (Round any intermedary calculations to the nearest cent.)
Answer:
$59,000
Explanation:
We will first determine the variable cost per unit
= $24,000/300
= $80
Contribution margin percentage =
$280 - ($80 - $1.10)/$280
= 0.72
= 72%
New break even point = $18,000/72%
= 25,000
Old break even point =
($280 - $80)/280
= 0.71
= 71%
= $18,000/71%
= $25,352
Margin of safety = $84,000 - $25,000
= $59,000
A and B are substitute goods and are priced the same. A complementary good of A increases in price while the price of the same complentary good for B remains the same. According to the law of demand, with everything else being equal, what will happen to the demand of A
Answer:
The demand for A will decrease
Explanation:
If A and B are substitute goods it means either A and B can be used in the place of the other as they satisfy same needs. Two goods are said to be complementary goods if the use of 1 of the goods requires the use of the other. For example if good A was a car, it's complementary good will be petrol.
Since A and B can be substituted for each other, if the price of a Complementary good for A increases, the demand for A will decrease because the law of demand says that higher prices causes decrease in demand. People will rather buy good B whose complement remains the same in price since it is cheaper.
I hope you find my answer useful.
Vaughn Company uses a periodic inventory system. For April, when the company sold 450 units, the following information is available. Units Unit Cost Total Cost April 1 inventory 330 $22 $7,260 April 15 purchase 380 26 9,880 April 23 purchase 290 29 8,410 1,000 $25,550 Required:Compute the April 30 inventory and the April cost of goods sold using the FIFO method.
Answer:
Ending inventory= $15,170
COGS= $10,380
Explanation:
Giving the following information:
Units sold= 450
April 1 inventory= 330 units for $22
April 15 purchase= 380 units for $26
April 23 purchase= 290 units for $29
First, we need to calculate the number of units in ending inventory:
Ending inventory units= 1,000 - 450= 550 units
Now, to calculate the ending inventory under the FIFO (First-in, first-out) method, we need to use the cost of the last units incorporated into inventory.
Ending inventory= 290*29 + 260*26= $15,170
COGS= 330*22 + 120*26= $10,380
You have a portfolio that is invested 16 percent in Stock A, 36 percent in Stock B, and 48 percent in Stock C. The betas of the stocks are .61, 1.16, and 1.45, respectively. What is the beta of the portfolio
Answer:
Beta= 1.2112
Explanation:
Giving the following information:
Stock A:
Proportion= 0.16
Beta= 0.61
Stock B:
Proportion= 0.36
Beta= 1.16
Stock C:
Proportion= 0.48
Beta= 1.45
To calculate the beta of the portfolio, we need to use the following formula:
Beta= (proportion of investment A*beta A) + (proportion of investment B*beta B) + (proportion of investment C*beta C)
Beta= (0.16*0.61) + (0.36*1.16) + (0.48*1.45)
Beta= 1.2112
Suppose Ningbo Steel had sales revenue of $11,000 sales revenue, cost of goods sold of $5,000, operating expenses of $3000, interest expense of $1,000, a tax rate of 20%, and 1,000 shares of common stock outstanding. Based on this information, net profit after tax was:_________.
A. $1,600
B. $500
C. $1,000
D. $0
Answer:
A. $1,600
Explanation:
Ningbo Steel
Income Statement
Sales Revenue $11,000
Less Cost of goods sold $5,000
Gross Profit $6,000
Less Operating Expense $3,000
Earning Before Interest and Taxes $3,000
Less Interest Expense $1,000
Earning before Tax $2,000
Less Tax Expenses (2,000 *20%) $400
Net Profit after tax $1,600
Crocetti Corporation makes one product and has provided the following information to help prepare the master budget for the next four months of operations: Budgeted selling price per unit $ 121 Budgeted unit sales (all on credit): January 7,000 February 7,500 March 11,900 April 14,900 Credit sales are collected: 40% in the month of the sale 60% in the following month The budgeted accounts receivable balance at the end of February is closest to:
Answer:
The budgeted accounts receivable balance at the end of February is closest to: $4,500.
Explanation:
Prepare a Accounts Receivable Budget for January and February
January February
Balance b/d $0 $4,200
Credit Sales $7,000 $7,500
Cash Received (40%) ($2,800) ($3,000)
Cash Received (60%) $0 ($4,200)
Balance c/d $4,200 $4,500
Conclusion:
Therefore, the budgeted accounts receivable balance at the end of February is closest to: $4,500
During an economic crisis many financial managers and corporate officers have been criticized for: Poor decisions Lack of ethical behavior Large salaries Lucrative severance packages worth millions of dollars Extravagant lifestyles Is this criticism justified
Answer:
for having large salaries.
Explanation:
These financial managers and corporate officers were criticized for having large salaries. This is mainly because during the financial crisis the stocks of these companies plummeted while compensation was still exorbitant. Compensation was supposed to be an incentive given to talent for maximizing the overall value of the firm through their work. Since this is not being done by the shareholders and officers then they should not be enjoying these compensations.
4. Calculate the required rate of return for Manning Enterprises assuming that investors expect 3.5% rate of inflation in the future. The real risk-free rate is 2.5%, and the market risk premium is 6.5% Manning has a beta of 1.7, and its realized rate of return has averaged 13.5% over the past 5 years.
Answer: 17.05%
Explanation:
Given the variables available, the method to be used to calculate the required return is the Capital Asset Pricing Model with the formula;
Required Return = Nominal Risk-free rate + beta ( Market premium)
Nominal Risk-free rate = real risk-free rate + inflation
= 2.5% + 3.5%
= 6%
Required Return = 6% + 1.7 ( 6.5%)
Required Return = 6% + 11.05%
Required Return = 17.05%
Longevo, a watch manufacturing company, offers watches in a wide range of designs to suit all age groups. To adequately cover its wide and diversified consumer base, the company makes use of all the traditional and new age media platforms for its promotions. The promotional strategy used by Longevo is _____.
Answer:
Integrated marketing communication.
Explanation:
In this scenario, Longevo, a watch manufacturing company, offers watches in a wide range of designs to suit all age groups. To adequately cover its wide and diversified consumer base, the company makes use of all the traditional and new age media platforms for its promotions. The promotional strategy used by Longevo is integrated market communication.
An integrated marketing communication is a marketing strategy which involves branding, promotion and coordination of marketing tools across traditional and digital communication channels such as webinar, blog, billboards, television, newspapers, radio etc in an organization. The marketing tools used in business are online marketing, direct marketing, advertising, social media, sales promotion, personal selling, public relations etc.
Hence, Longevo makes use of all the traditional and new age media platforms for the promotion of its watches, to adequately cover its wide and diversified consumer base.
Tracy Company, a manufacturer of air conditioners, sold 200 units to Thomas Company on November 17, 2021. The units have a list price of $450 each, but Thomas was given a 30% trade discount. The terms of the sale were 3/10, n/30. Required: 1. Prepare the journal entries to record the sale on November 17 (ignore cost of goods) and collection on November 26, 2021, assuming that the gross method of accounting for cash discounts is used. 2. Prepare the journal entries to record the sale on November 17 (ignore cost of goods) and collection on December 15, 2021, assuming that the gross method of accounting for cash discounts is used.
Answer and Explanation:
The Journal entries is shown below:-
1. a. Tracy Company Dr, $63,000 ($450 × 70% × 200)
To Sales $63,000
(Being sales is recorded)
b. Cash Dr, $61,110 ($63,000 - ($63,000 × 3%)
Sales discount $1,890 Dr, ($63,000 × 3%)
To Tracy Company $63,000
(Being cash and sales discount is recorded)
2. a Tracy Company Dr, $63,000 ($450 × 70% × 200)
To Sales $63,000
(Being sales is recorded)
b. No Journal entry is required
c. Cash Dr, $63000
To Tracy Company $63,000
(Being cash is recorded)
On January 1, 20X6, Plus Corporation acquired 90 percent of Side Corporation for $180,000 cash. Side reported net income of $30,000 and dividends of $10,000 for 20X6, 20X7, and 20X8. On January 1, 20X6, Side reported common stock outstanding of $100,000 and retained earnings of $60,000, and the fair value of the noncontrolling interest was $20,000. It held land with a book value of $30,000 and a market value of $35,000 and equipment with a book value of $50,000 and a market value of $60,000 at the date of combination. The remainder of the differential at acquisition was attributable to an increase in the value of patents, which had a remaining useful life of five years. All depreciable assets held by Side at the date of acquisition had a remaining economic life of five years. Plus uses the equity method in accounting for its investment in Side.
1. Based on the preceding information, the increase in the fair value of patents held by Side is:
a. $20,000
b. $25,000
c. $15,000
d. $5,000
2. Based on the preceding information, what balance would Plus report as its investment in Side at January 1, 20X8?
a. $230,400
b. $180,000
c. $234,000
d. $203,400
Answer:
1) b) $25,000
2) d. $203,400
Explanation:
1)
Ref Particulars Amount
a Fair value of entity 200,000
b Total value without patent 175,000
c=a-b Patent 25,000
Therefore, the increase in the fair value of patents held by Side is;
b) $25,000
Fair value of consideration given:
Ref Particulars Amount
Stock 0
Cash 180,000
a Total consideration 180,000
b Stake acquired 90%
c=a/b Fair value of subsidiary 200,000
d=100%-b Minority interest 10%
e=c*d Fair value of minority interest 20,000
On acquisition date
Value of subsidiary without patent
Common stock 100,000
Paid in capital -
Retained earnings 60,000
Fair value adjustment:
Patent -
Equipment 10,000
Land 5,000
Fair value without patent 175,000
2)
Particulars Investment
Acquisition date 180,000
Add: share of net income 54,000
Less: Dividends 18,000
Less: Fair value amortization 12,600
Balance Jan 1, 20X8 203,400
{Share of earnings for 2 years = 30,000 × 2 × 90% = 54,000 }
{Share of dividends for 2 years = 10,000 × 2 × 90% = 18,000 }
{Fair value amortization for 2 years = 7,000 × 90% × 2 = 12,600}
Therefore Balance as at Jan 1, 20X8 is
d) $203,400
The manager for a growing firm is considering the launch of a new product. If the product goes directly to market, there is a 40 percent chance of success. For $171,000, the manager can conduct a focus group that will increase the product's chance of success to 55 percent. Alternatively, the manager has the option to pay a consulting firm $386,000 to research the market and refine the product. The consulting firm successfully launches new products 70 percent of the time. If the firm successfully launches the product, the payoff will be $1.86 million. If the product is a failure, the NPV is zero.
1. Calculate the NPV for each option available for the project. (Do not round intermediate calculations. Enter your answers in dollars, not millions of dollars, e.g. 1,234,567.)
2. Which action should the firm undertake?
A. Consulting firm
B. Focus group
C. Go to market now
Answer:
1. Calculate the NPV for each option available for the project. (Do not round intermediate calculations. Enter your answers in dollars, not millions of dollars, e.g. 1,234,567.)
go to market now = $744,000focus group = $852,000consulting firm = $916,0002. Which action should the firm undertake?
A. Consulting firmThe NPV is higher than the rst of the options.
Explanation:
expected payoffs:
option 1 (go to market now) = (40% x $1.86 million) + 0 = $744,000option 2 (focus group) = (55% x $1.86 million) + 0 = $1,023,000option 3 (consulting firm) = (70% x $1.86 million) + 0 = $1,302,000expected NPVs:
option 1 (go to market now) = $744,000option 2 (focus group) = $1,023,000 - $171,000 = $852,000option 3 (consulting firm) = $1,302,000 - $386,000 = $916,000go to market now
A sudden fall in the market demand in a competitive industry leads to a. A short run market equilibrium price lower than the original equilibrium b. A market equilibrium price higher than the short run price c. Some firms exiting the market d. All of the above
Answer:
The answer is C. Some firms exiting the market
Explanation:
When there is a sudden fall in the market demand in a competitive industry(e.g perfect competition) some firms would making economic losses and it is best if they shut down operation and production. Once these happen, they exit the market.
Option A is incorrect . Same as option B.
Option D is also incorrect
Airco Company is tempted to consider support department costs to be facility-level costs that do not need to be applied to products. Which of the following explains what is misguided about this approach?
1. Product costs may be inaccurate because straight-line depreciation on factory equipment is treated as a genera and administrative expense on the income statement.
2. Product costs may be inaccurate because support department services may be used more heavily by some products than others.
3. Product costs may be inaccurate because incorrect cost drivers are used.
4. Product costs may be inaccurate because direct labor and direct materials are not correctly accounted for in thu product costing system.
Answer:
Option 2. Product costs may be inaccurate because support department services may be used more heavily by some products than others.
Explanation:
Option 1 is not a misguide about this approach as all the depreciation costs are considered as general or administration expenses.
Option 3 is incorrect because cost drivers of cost pools are always accurate, they can not be used inaccurately while using Activity Based Costing.
Option 4 is also incorrect because direct costs are prime cost which are easily attributable to products and in this scenario, the indirect costs are considered inappropriate to be assigned to the product cost.
Option 2 is correct because considering support department costs to be facility-level costs would result in inappropriate cost allocations to some products as a single appropriate basis would be used to allocate the support department services cost to each product. This means if appropriate basis is not chosen correctly then this would result in inaccurate allocation as some of the products will be using the support services heavily than others.
The depreciation method that produces larger depreciation expense during the early years of an asset's life and smaller expense in the later years is a(an):
Answer:
Accelerated depreciation method
Explanation:
Accelerated depreciation is a method of depreciation in which the assets lost his purchase price or book value at the speedy rate as compared with the straight-line method.
And it generates a larger amount of expenses during the early period and the smaller amount of expenses in the later year so that it can be decreased the taxable income
You have a portfolio worth $63,500 that has an expected return of 13.3 percent. The portfolio has $16,900 invested in Stock O, $24,700 invested in Stock P, with the remainder in Stock Q. The expected return on Stock O is 18.1 percent and the expected return on Stock P is 11.3 percent. What is the expected return on Stock Q
Answer:
Return on Stock Q is 11.85%
Explanation:
Investment in Q = ($63,500 - $16,900 - $24700)
Investment in Q =21900
Portfolio return = Respective return * Respective investment weight
13.3= (16900 / 63500 * 18.1%) + ( $24,700 / $63,500 * 11.3% ) + ( $21900 / $63,500 * Return on Q)
13.3 = 4.817165354 + 4.39533071% + (21900 / 63500*Return on Q)
13.3 = 9.21259843% + (21900 / 63500*Return on Q)
Return on Q = (13.3% -9.21259843%) *63500/21900
Return on Q = (4.08740157 * 2.899543379)
Return on Q = 11.85159816%
Return on Q =11.85%
Jobs in which employees must frequently display emotions that oppose their genuine emotion require more emotional labor.
a) true
b) false
Answer:
a) true.
Explanation:
This statement is true, because emotions are feelings inherent to the human being, and therefore they also directly influence work, even though there is a posture geared more to the execution of reason due to professional posture than to emotions.
The ideal is therefore that there is a management aimed at creating an organizational culture aimed at the development of positive emotions, such as ethics, mutual respect, adequate communication, preservation of individual values, etc.
Emotions are capable of directly influencing the actions of employees, when they are positive they motivate and encourage the performance of productive work, when they are negative it can generate conflicts, demotivation, employee turnover, etc.
Consider a four-year project with the following information:
initial fixed asset investment = $470,000; straight-line depreciation to zero over the four-year life; zero salvage value; price = $30; variable costs = $20; fixed costs = $160,000; quantity sold = 77,000 units; tax rate = 30 percent.
1. What is the degree of operating leverage at the given level of output?
2. What is the degree of operating leverage at the accounting break-even level of output?
Answer and Explanation:
1. The computation of the Degree of operating leverage is
= Quantity sold × (Price - Variable cost) ÷ (Quantity sold × (Price - Variable cost) - Fixed cost)
where,
Fixed cost = $160,000 + $470,000 ÷ 4
= $277,500
Now the degree of operating leverage is
= 77000 × ($30 - $20) ÷ ($77,000 × ($30 - $20) - $277,500)
= 1.56
2. The Accounting Break-even level of output is
The break even point is
= Fixed cost ÷ (Price - Variable cost)
= $277500 ÷ ($30 - $20)
= $27,750
As the degree of operating leverage could not be calculated as the denominator comes to zero
Most economists believe that real economic variables and nominal economic variables behave independently of each other in the long run. For example, an increase in the money supply, a _____________ variable, will cause the price level, a __________ variable, to increase but will have no long-run effect on the quantity of goods and services the economy can produce, a _____________ variable. The notion that an increase in the quantity of money will impact the price level but not the output level is known as___________________.
Answer:
nominal; nominal; real; the classical dichotomy.
Explanation:
Most economists believe that real economic variables and nominal economic variables behave independently of each other in the long run. For example, an increase in the money supply, a nominal variable, will cause the price level, a nominal variable, to increase but will have no long-run effect on the quantity of goods and services the economy can produce, a real variable. The notion that an increase in the quantity of money will impact the price level but not the output level is known as the classical dichotomy.
A nominal variable is the monetary value of a security such as bonds or stocks, without considering any change in price caused by inflation. It is also referred to as the par value or face value.
A real variable measures goods and services taking into consideration any change in price or that has been adjusted for inflation so as to allow comparison of goods with respect to another goods or services.
Hence, if the money supply is increased, it will cause an increase in the price of goods and services but will have no effect on the gross domestic product (GDP), which is known as the classical dichotomy.
"If bookstore ABC Books determines it is going to sell books at its profit-maximizing price of $16 in a market facing monopolistic competition, calculate total profit for the store. ABC Books Revenue and Cost Quantity Price Total Revenue Marginal Revenue Total Cost Marginal Cost 0 $26 $0 - $300 - 10 $23 $230 $23 $340 $4 20 $20 $400 $17 $400 $6 30 $18 $540 $14 $480 $8 40 $16 $640 $10 $580 $10 50 $14 $700 $6 $700 $12 60 $12 $720 $2 $840 $14"
Answer:
40 books revenue is maximized
Explanation:
Profit is maximized where Marginal cost equals Marginal Revenue. The revenue is maximized where 40 books are sold for the price of $16. The marginal revenue at this point equals the marginal cost. Profit will be maximized for the ABC Books if it sells 40 books at the price of $16 per book. Here Marginal cost is $10 and marginal revenue is also $10. This is profit maximizing point.
While walking along a beach, Daniel notices that several girls are wearing large, round plastic sunglasses and the boys are wearing metal sunglasses. Which concept most likely accounts for the similar fashion within a gender and the different fashions between genders? A. Consumerism B. Competition C. Individual behavior D. Peer pressure
Answer:
the correct answer should be A.
Coyote Loco, Inc., a distributor of salsa, has the following historical collection pattern for its credit sales.
80 percent collected in the month of sale.
10 percent collected in the first month after sale.
5 percent collected in the second month after sale.
4 percent collected in the third month after sale.
1 percent uncollectible.
The sales on account have been budgeted for the last seven months as follows:
June $126,500
July 154,000
August 179,000
September 208,000
October 233,000
November 258,000
December 220,500
Required:
1. Compute the estimated total cash collections during October from credit sales.
2. Compute the estimated total cash collections during the fourth quarter from sales made on account during the fourth quarter.
Answer:
80 perent...
Explanation:
1. The estimated total cash collections during the month of October from credit sales are $222,310.
2. The estimated total cash collections during the fourth quarter of the year from sales made only on account during the fourth quarter are $835,870 ($166,400 + $207,200 + $240,100 + $222,170).
Data and Calculations:
Cash Collections from Credit Sales
June Jul Aug Sept Oct. Nov. Dec.
Credit Sales:
$126,500 $ 154,000 $179,000 $208,000 $233,000 $258,000 $220,500
Cash Collections:
80% $166,400 $186,400 $206,400 $176,400
10% 17,900 20,800 23,300 25,800
5% 7,700 8,950 10,400 11,650
4% 5,060 6,160 7,160 8,320
Total collections $222,310
June Jul Aug Sept Oct. Nov. Dec.
Credit Sales:
$126,500 $ 154,000 $179,000 $208,000 $233,000 $258,000 $220,500
Cash Collections:
80% $166,400 $186,400 $206,400 $176,400
10% 20,800 23,300 25,800
5% 10,400 11,650
4% 8,320
Total collections $166,400 $207,200 $240,100 $222,170
Thus, cash collections in October alone are $222,310 while for the fourth quarter based on fourth quarter credit sales only are $835,870.
Learn more: https://brainly.com/question/22850167
On November 1, Jasper Company loaned another company $100,000 at a 6.0% interest rate. The note receivable plus interest will not be collected until March 1 of the following year. The company's annual accounting period ends on December 31. The amount of interest revenue that should be reported in the first year is:
Answer:
The amount of interest revenue that should be reported in the first year is $1,000
Explanation:
As we know Note receivable is a type of investment on which the Noteholder receives te interest over the note amount.
Value of Note = $100,000
Rate = 6%
until 31 December only two months has been passed and the interest revenue of only 2 months will be recognized as follow
Interst Revenue = $100,000 x 6% x 2/12 = $1,000
So the interest revenue of $1,000 should be reported in the first year.
how much would you have to earn each month to cover your living expense
Answer:
about $4,100 a month
Explanation:
A bond with a coupon rate of "5.96" percent and semiannual coupon payments matures in 18 years. The YTM is 6.97 percent. What is the effective annual yield?
Available Options Are:
(A) 7.38%
(B) 5.96%
(C) 6.05%
(D) 7.09%
(E) 6.97%
Answer:
Effective Annual Yield is 7.09%
Explanation:
The Effective Annual Yield can be calculated as under:
Effective Annual Yield = (1 + YTM / n)^n - 1
Here,
YTM is 6.97%
n is 12/6 for semi annual coupon payments
By putting values, we have:
Effective Annual Yield = (1 + 6.97% / 2)^2 - 1
Effective Annual Yield = (1.03485)^2 - 1 = 0.0709145 = 7.09%
Gitano Products operates a job-order costing system and applies overhead cost to jobs on the basis of the direct materials uses in production (not on the basis of raw materials). Its predetermined overhead rate was based on a cost formula that estimated $126,000 of manufacturing overhead for an estimated allocation base of $90,000 direct material dollars to be used in production. The Company has provided the following data for the just completed year:
Purchase of raw materials $138,000
Direct Labor Cost $86,000
Manufacturing Overhead Costs:
Indirect Labor $122,600
Property Taxes $8,900
depreciation of equipment $15,000
Maintenance $15,000
Insurance $10,000
Rent, building $35,000
Beginning Ending
Raw Materials $25,000 $15,000
Work in Process $49,000 $39,000
Finished Goods $74,000 $59,000
Required:
a. Compute the predetermined overhead rate for the year.
b. Compute the amount of underapplied or overapplied overhead for the year.
c. Prepare a schedule of cost of goods manufactured for the year. Assume all raw materials are used in production as direct materials.
Answer and Explanation:
1. The computation of the predetermined overhead rate is shown below;
Predetermined Overhead Rate is
= Estimated Manufacturing Overhead ÷ Estimated Allocation Base × 100
= $126,000 ÷ $90,000
= 140%
2. Now the amount of underapplied or overapplied overhead is
But before that we need to find out the overhead applied and overhead incurred which is
= (Opening Value of Direct Material + Purchase of Direct Material - Closing Value of Direct Material) × Predetermined Overhead Rate
= ($25,000 + 138,000 - $15,000) × 140%
= $207,200
Now the Overhead Incurred is
Indirect Labor $122,600
Property Taxes $8,900
depreciation of equipment $15,000
Maintenance $15,000
Insurance $10,000
Rent, building $35,000
Total $206,500
So, the overhead over applied is
= $207,200 - $206,500
= $700
c. Now the schedule of cost of goods manufactured is presented below:
Opening Raw Material $25,000
Add Purchases of Raw Material $138,000
Less Closing Stock of Raw Material -$15,000
Direct Material Used $148,000
Add:
Direct Labor $86,000
Manufacturing Overhead Applied $207,200
Total Manufacturing Costs $441,200
Add Opening WIP $49,000
Less Closing WIP -$39,000
Cost of Goods Manufactured $451,200
Retired utility workers are suing their former employer for knowingly exposing them to asbestos without warning them of the health risks. The retired workers did not learn of the prolonged exposure until long after their retirement because the company engaged in a systematic cover up of the exposure. The retired workers' cause of action is for which of the following?
a. Assault
b. Battery
c. Injurious falsehood
d. Tortious interference
Answer:
b. Battery
Explanation:
Retired utility workers are suing their former employer for knowingly exposing them to asbestos without warning them of the health risks. The retired workers did not learn of the prolonged exposure until long after their retirement because the company engaged in a systematic cover up of the exposure. The retired workers' cause of action is for battery.
In Business law, battery can be defined as the act of intentionally causing physical harm to an individual or group of people through physical contacts.
Hence, in this case the employers knowingly or intentionally exposed the retired workers to asbestos without warning them of the health risks associated.
Simply stated, a battery in criminal law is completed assault.