Answer:
It's $50
Explanation:
Harrington Industries, which uses a process-costing system, had a balance in its Work-in-Process account of $68,000 on January 1. The account was charged with direct materials, direct labor, and manufacturing overhead of $450,000 throughout the year. If a review of the accounting records determined that $86,000 of goods were still in production at year-end, Harrington should make a journal entry on December 31 that includes:______.
a) a debit to Cost of Goods Sold for $432,000.
b) a debit to Finished-Goods Inventory for $86,000.
c) a credit to Work-in-Process Inventory for $432,000.
d) a credit to Work-in-Process Inventory for $86,000.
e) a credit to Finished-Goods Inventory for $432,000.
Answer:
c) a credit to Work-in-Process Inventory for $432,000.
Explanation:
Based on the information given Harrington should make a journal entry on December 31 that includes: A credit to Work-in-Process Inventory for the amount of $432,000 Calculated as :
Opening WIP $68,000
Add Costs incurred throughout $450,000
Less ending WIP ($86,000)
$432,000
Dr Inventory $432,000
Cr Work-in-Process $432,000
A small town is considering paving paradise hotel to put up a parking lot. The land will cost $25,000 and the construction of the lot is estimated to be $150,000. Each year, costs associated with the parking lot are estimated to be $17,500. The income from the lot is expected to be $18,000 the first year and increase by $3,500 each year for the 12 year life of the lot. Determine the B/C ratio if interest rate is 12%. [4 points]
Answer:
0.71
Explanation:
The benefit cost ratio is used to determine the profitability of an investor. It is determined by dividing the present value of benefit by the present value of cost
Benefit cost ratio (BC) = present value of benefits / present value of costs
if BC is greater than 1, the project is profitable
If BC is less than 1, the project is not profitable
Present value is the sum of discounted cash flows
Present value can be calculated using a financial calculator
Present value of the benefits
Cash flow in year 1 = $18,000
Cash flow in year 2 = $18,000 + 3500 = $21500
Cash flow in year 3 = $18,000 + (3500 x 2) = $25,000
Cash flow in year 4 = $18,000 + (3500 x 3) = $28500
Cash flow in year 5 = $18,000 + (3500 x 4) = $32,000
Cash flow in year 6 = $18,000 + (3500 x 5) = $35,500
Cash flow in year 7 = $18,000 + (3500 x 6) = $39,000
Cash flow in year 8 = $18,000 + (3500 x 7) = $42,500
Cash flow in year 9 = $18,000 + (3500 x 8) = $46,000
Cash flow in year 10 = $18,000 + (3500 x 9) = $49500
Cash flow in year 11 = $18,000 + (3500 x 10) = $53,000
Cash flow in year 12 = $18,000 + (3500 x 11) = $56,500
I = 12 %
PV = $202,331.70
Present value of the cost
Cash flow in year 0 = $25,000 + $150,000 = $175,000
Cash flow in year 1 to 12 = $17,500.
I = 12 %
PV = $283,401.55
B/C ratio = $202,331.70 / $283,401.55 = 0.71
To find the PV using a financial calculator:
1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.
2. after inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.
3. Press compute
Flynn Industries has three activity cost pools and two products. It estimates production 2,000 units of Product BC113 and 1,000 of Product AD908. Having identified its activity cost pools and the cost drivers for each pool, Flynn accumulated the following data relative to those activity cost pools and cost drivers.
Annual Overhead Data Estimated Use of Cost Drivers per Product
Activity Cost Pools Cost Drivers Estimated Overhead Estimated Use of Cost Drivers per Activity Product BC113 Product AD908
Machine setup Setups $27,000 45 28 17
Machining Machine hours 109,560 4,980 1,180 3,800
Packing Orders 26,950 540 180 160
Required:
Using the above data, do the following:
Prepare a schedule Showing the Computations Of the activity-based overhead rates per Cost driver.
Answer:
Follows are the instructions to this question:
Explanation:
Given:
Configuration of machine = [tex]\$16,000 \ \ \ \ 40 \ \ \ \ 25 \ \ \ \ 15[/tex]
Machine hours= [tex]\$110,000 \ \ \ \ 5,000 \ \ \ \ 1,000 \ \ \ \ 4,000[/tex]
Order on Packing= [tex]\$30,000\ \ \ \ 500 \ \ \ \ 150 \ \ \ \ 350[/tex]
We have to use the following formula in order to measure the expected production overhead rate:
Estimated overhead production rate= Total projected production expenses and for period/Total base allocation sum
Machine Configuration [tex]=\frac{16,000}{(40+25+15)}= \frac{16,000}{80} =\$200 / \ setup[/tex]
Machining hour= [tex]=\frac{110,000}{(5,000 + 1,000 + 4,000)} =\frac{110,000}{(10,000)}= \$11 / \ machine \ hour[/tex]
Packing[tex]= \frac{30,000}{(500 + 150 + 350)}= \frac{30,000}{1000}= \$30/ \ order[/tex]
Suppose Lana lives in a small college town where, every weekend, 10 independent food cart owners set up shop and sell hot dogs on the street. They are popular with students, and they frequently locate where students hang out. One evening, Lana overhears the conversation of three of the food cart owners as they conspire to raise the price of their hot dogs. That same night, she reports the conversation to the Department of Justice via their antitrust complaint website. Why might the Department of Justice NOT send an agent to investigate the collusion attempt that Lana witnessed?
a) Antitrust laws are applicable only to collusion attempts that occur on federal government property and the collusion attempt occurred on private property
b) Collusion among small competitors like street vendors is actually beneficial to consumers.
c) The Department of Justice lacks the resources to investigate every case of collusion reported.
To ensure small businesses a fair shot at competing with larger businesses, President Obama issued an official executive order to the Department of Justice in 2012 to stop pursuing antitrust violations involving small businesses only
d) There is not a law that prohiblts collusion among competitors
Answer: c. The Department of Justice lacks the resources to investigate every case of collusion reported.
Explanation:
Based on the information that has been provided in the question, the reason why the Department of Justice may not send an agent to investigate the collusion attempt that was witnessed by Lana is when "the Department of Justice lacks the resources to investigate every case of collusion reported".
In this case, the department of Justice may not have the resources that will be used in investigating all the resources that was brought to them and they may not necessarily see this case as a serious case. Hence it may not be investigated.
Using the appropriate present value table and assuming a 12% annual interest rate, determine the present value on December 31, 2018, of a five-period annual annuity of $5,000 under each of the following situations: (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.)
1. The first payment is received on December 31, 2019, and interest is compounded annually.
2. The first payment is received on December 31, 2018, and interest is compounded annually.
3. The first payment is received on December 31, 2019, and interest is compounded quarterly.
Answer:
1. Present value on December 31, 2018 = $18,023.88
2. Present value on December 31, 2018 = $20,186.75
3. Present value on December 31, 2018 = $17,780.59
Explanation:
1. The first payment is received on December 31, 2019, and interest is compounded annually.
This is an example of ordinary annuity. Therefore, the present value on December 31, 2018 can be calculated using the formula for calculating the present value of an ordinary annuity as follows:
PV = P * ((1 - (1 / (1 + r))^n) / r) …………………………………. (1)
Where;
PV = present value on December 31, 2018 = ?
P = Annual annuity = $5,000
r = Annual interest rate = 12%, or 0.12
n = number of years = 5
Substitute the values into equation (1), we have:
PV = $5,000 * ((1 - (1 / (1 + 0.12))^5) / 0.12)
PV = $5,000 * 3.60477620234501
PV = $18,023.88
2. The first payment is received on December 31, 2018, and interest is compounded annually.
This is an example of annuity due. Therefore, the present value on December 31, 2018 can be calculated using the formula for calculating the present value of an annuity due as follows:
PV = P * ((1 - [1 / (1+r))^n) / r) * (1+r) .................................. (2)
Where;
Where;
PV = present value on December 31, 2018 = ?
P = Annual annuity = $5,000
r = Annual interest rate = 12%, or 0.12
n = number of years = 5
Substitute the values into equation (1), we have:
PV = $5,000 * ((1 - [1 / (1+0.12))^5) / 0.12) * (1+0.12)
PV = $5,000 * 3.60477620234501 * 1.12
PV = $5,000 * 4.03734934662641
PV = $20,186.75
3. The first payment is received on December 31, 2019, and interest is compounded quarterly.
Note: See the calculation of the present value on December 31, 2018 in the attached excel file.
This is also an example of ordinary annuity.
In the attached excel file, the following formula is used:
Discounting factor = 1 / (1 + r)^n .............. (1)
Where;
r = Quarterly interest rate = Annual interest rate / Number of quarters in a year = 12% / 4 = 0.12 / 4 = 0.03
n = number of quarters = number of years * Number of quarters in a year
From the attached excel file, we have:
Present value on December 31, 2018 = Total present value = $17,780.59
What is the correct order for applying the following three items to adjust a partner's tax basis in his partnership interest: (1) Increase for share of ordinary business income, (2) Decrease for share of separately stated loss items, and (3) Decrease for distributions
Answer: 1, 2, and then 3
Explanation:
To adjust a partner's basis in the partnership, first increase the basis for a share of ordinary business income as this adds to their interest.
Then decrease for share of separately stated loss items as these are losses and will reduce the basis. Finally decrease the basis for any distributions because distributions reduce a partner's interest.
Current information for the Healey Company follows:
Beginning raw materials inventory $ 16,600
Raw material purchases 61,400
Ending raw materials inventory 18,000
Beginning work in process inventory 23,800
Ending work in process inventory 29,400
Direct labor 44,200
Total factory overhead 31,400
All raw materials used were traceable to specific units of product. Healey Company's direct materials used for the year is:__________
a.) $116,200.
b.) $124,600
c.) $121,800.
d.) $127,400.
e.) $131,200.
Answer:
$60,000
Explanation:
The computation of the direct material used is shown below:
= Beginning raw material inventory + purchase of raw material - ending raw material inventory
= $16,600 + $61,400 - $18,000
= $60,000
This is the right answer but the same is not provided in the given options
Natalia needs to create a subreport to provide information about suppliers for a particular category of item in a table. What should she do?
Choose from a list.
Define a list.
Show suppliers for each record using foreign/primary key relationship.
Create a data report that shows the entire list of suppliers.
Answer:
C
Explanation:
Just took it
Answer:
Show suppliers for each record using foreign/primary key relationship.
Explanation:
Mortensen Industries, which uses a process-costing system, adds material at the beginning of production and incurs conversion cost evenly throughout manufacturing. The following selected information was taken from the company's accounting records:
Total equivalent units of materials: 5,000
Total equivalent units of conversion: 4,400
Units started and completed during the period: 3,500
On the basis of this information, the ending work-in-process inventory's stage of completion is:_____.
a. 80%.b. 70%.c. 60%.d. 40%.
Answer:
c. 60%.
Explanation:
Calculation for what the ending work-in-process inventory's stage of completion is:
First step is to calculate the Ending WIP
Ending WIP = 5,000 - 3,500
Ending WIP = 1,500 units
Now let calculate the ending work-in-process inventory's stage of completion using this formula
Ending work-in-process inventory's stage of completio
4,400 = 3,500 + (x% * 1,500)
4,400 = 3,500 + 15x
15x = 4,400 - 3,500
15x = 900
x = 900/15
x = 60%
Therefore the ending work-in-process inventory's stage of completion is:60%
Braam Corporation uses direct labor-hours in its predetermined overhead rate. At the beginning of the year, the estimated direct labor-hours were 11,500 hours. At the end of the year, actual direct labor-hours for the year were 9,700 hours, the actual manufacturing overhead for the year was $143,350, and manufacturing overhead for the year was underapplied by $18,220. The estimated manufacturing overhead at the beginning of the year used in the predetermined overhead rate must have been: (Do not round your intermediate calculations.)
Answer:
$20,000.
Explanation:
Step 1 : Applied overheads
Applied overheads = $143,350 - $18,220 = $125,130
Step 2 : Overhead rate
Overhead rate = $125,130 / 9,700 = $12.90
The estimated manufacturing overhead at the beginning of the year used in the predetermined overhead rate must have been $20,000.
Sheen Co. manufactures laser printers. It has outlined the following overhead cost drivers. Overhead Costs Pool Cost Driver Overhead Cost Budgeted cost driver Quality control Number of inspections $ 64,800 1,080 Machine operation Machine hours 132,000 1,100 Materials handling Number of batches 900 30 Miscellaneous overhead cost Direct labor hours 48,000 4,000 Sheen Co. has an order for 1,000 laser printers that has the following production requirements: Number of Inspections 175 Machine Hours 180 Number of Batches 5 Direct Labor Hours 650 Use activity-based costing to determine a unit cost for the laser printers
Answer:
Sheen Co.
The overhead unit cost for the laser printers is:
= $40.05
Explanation:
a) Data and Calculations:
Overhead Costs Pool Cost Driver Overhead Budgeted
Cost cost driver
Quality control Number of inspections $ 64,800 1,080
Machine operation Machine hours 132,000 1,100
Materials handling Number of batches 900 30
Miscellaneous Direct labor hours 48,000 4,000
Overhead Rates:
Quality control = $60 ($64,800/1,080)
Machine operation = $120 ($132,000/1,100)
Materials handling = $30 ($900/30)
Miscellaneous overhead costs = $12 ($48,000/4,000)
Quantity of order = 1,000 laser printers
Requirements of the order: Overhead Rate Total
Number of Inspections 175 $60 (175*$60) $10,500
Machine Hours 180 $120 (180*$120) 21,600
Number of Batches 5 $30 (5*$30) 150
Direct Labor Hours 650 $12 (650*$12) 7,800
Total overhead allocated to 1,000 laser printers = $40,050
Unit overhead cost for the printers = $40.05 ($40,050/1,000)
A company had the following items and amounts in its unadjusted trial balance as of December 31 of the current year: (3 points)
Debit Credit
Cash sales……………………………………………….. $188,000
Credit sales……………………………………………… 275,000
Accounts receivable…………………………………….. $76,000
Allowance for doubtful accounts……………………….. 1,000
Prepare the adjusting entry to estimate bad debts assuming an aging analysis estimates that 8% of the outstanding accounts receivable will be uncollectible.
Answer:
Particulars Amount
Provision for uncollectible $6,080 ($76000*8%)
Less: Provision already made $1,000
Provision to be made $5,080
Date Particulars Debit Credit
31-Dec Bad Debts $5,080
To Allowance for Doubtful Accounts $5,080
(Being the adjusting entry to estimate bad debts)
A technological improvement in apple production will: A. Increase the demand for apples, lowering the equilibrium price but raising the equilibrium quantity of apples. B. Increase the supply of apples, raising the equilibrium price but lowering the equilibrium quantity of apples. C. Increase the supply of apples, lowering the equilibrium price and quantity of apples. D. Increase the supply of apples, lowering the equilibrium price but raising the equilibrium quantity of apples. E. Increase the supply apples, raising the equilibrium price and quantity of apples.
Answer:
C. Increase the supply of apples, lowering the equilibrium price and quantity of apples.
Explanation:
Technological improvement can be regarded as an positive change or rise in efficiency of a product as well as the process which in turn results in tangible increase in output, even though there is no significant increase in input. It should be noted that technological improvement in apple production will Increase the supply of apples, lowering the equilibrium price and quantity of apples.
On January 1, 2021, Majestic Mantles leased a lathe from Equipment Leasing under a finance lease. Lease payments are made annually. Title does not transfer to the lessee and there is no purchase option or guarantee of a residual value by Majestic. Portions of the Equipment Leasing’s lease amortization schedule appear below: Jan. 1 Payments Effective Interest Decrease in Balance Outstanding Balance 308,032 2021 30,000 30,000 278,032 2022 30,000 23,633 6,367 271,665 2023 30,000 23,092 6,908 264,757 2024 30,000 22,504 7,496 257,261 2025 30,000 21,867 8,133 249,128 2026 30,000 21,176 8,824 240,303 2027 30,000 20,426 9,574 230,729 — — — — — — — — — — — — — — — 2038 30,000 6,513 23,487 53,135 2039 30,000 4,516 25,484 27,651 2040 30,000 2,350 27,650 0 Required: 1. What is Majestic’s lease liability after the first lease payment?2. What amount would Majestic record as a right-of-use asset? 3. What is the lease term in years? 4. What is the effective annual interest rate? (Round your percentage answers to 1 decimal place.) 5. What is the total amount of lease payments? 6. What is the total effective interest expense recorded over the term of the lease?
1. Majestic’s lease liability after the first lease payment is $278,032.
2. The amount that Majestic would record as a right-of-use asset is $308,032.
3. The lease term in years is 20 years.
4. The effective annual interest rate is 8.5%.
5. The total amount of lease payments is $600,000.
6. The total effective interest expense recorded over the term of the lease is $29,1968.
Data and Calculations:Lease Amortization Schedule
Jan. 1 Payments Effective Interest Decrease Outstanding
in Balance Balance
308,032
2021 30,000 30,000 278,032
2022 30,000 23,633 6,367 271,665
2023 30,000 23,092 6,908 264,757
2024 30,000 22,504 7,496 257,261
2025 30,000 21,867 8,133 249,128
2026 30,000 21,176 8,824 240,303
2027 30,000 20,426 9,574 230,729
— — — — — — — — — — — — — — —
2038 30,000 23,487 6,513 53,135
2039 30,000 25,484 4,516 27,651
2040 30,000 27,650 2,350 0
Lease term = 20 years (2040 - 2020).
Effective annual interest rate = 8.5% ($23,633/$278,032 x 100).
Total amount of lease payments = $600,000 ($30,000 x 20).
Total effective interest expense recorded over the term of the lease = $29,1968 ($600,000 - $308,032).
Thus, the total effective interest expense recorded over the term of the lease is $29,1968.
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Real business cycle theory argues that: a. changes in inventories are the cause of the business cycle. b. fluctuations in the rate of growth of total factor productivity cause the business cycle. c. aggregate demand is more important than aggregate supply in identifying the causes of the business cycle. d. changes in the money supply are the primary cause of the business cycle. e. changes in foreign exchange rates are the cause of the business cycle.
Answer:
b. fluctuations in the rate of growth of total factor productivity cause the business cycle
Explanation:
Primary cause of business cycle fluctuations, according to real business cycle theory includes achange in the production function, change in the size of the labor force and change in the real quantity of government purchases and others. While the Real business cycle theorists holds the view that that most business cycle fluctuations are caused by shocks to the production function. Fluctuations is commonly defined as the rise and fall in prices of goods and services.
The real business cycle theory holds the view that fluctuations in the rate of growth of total factor productivity cause the business cycle and these qualities (attributes) the source of business cycles to shifts of the aggregate supply curve.
The adjusted trial balance of George Cooper Co. as of December 31, 2020, contains the following.
GEORGE COOPER CO. ADJUSTED TRIAL BALANCE DECEMBER 31, 2020
Debit Credit
Cash $20,397
Accounts Receivable 7,845
Prepaid Rent 3,205
Equipment 18,975
Accumulated Depreciation-Equipment $5,820
Notes Payable 6,625
Accounts Payable 6,397
Common Stock 20,925
Retained Earnings 12,235
Dividends 3,925
Service Revenue 12,515
Salaries and Wages Expense 7,765
Rent Expense 2,190
Depreciation Expense 215
Interest Expense 153
Interest Payable 153
$64,670 $64,670
Required:
a. Prepare an income statement.
b. Prepare a statement of retained earnings.
c. Prepare a classified balance sheet.
Answer:
George Cooper Co.
a. Income Statement for the year ended December 31, 2020:
Service Revenue $12,515
Salaries and Wages Expense 7,765
Rent Expense 2,190
Depreciation Expense 215
Interest Expense 153 10,323
Net income $2,192
b. Statement of Retained Earnings for the year ended December 31, 2020
Retained Earnings $12,235
Net income 2,192
Dividends 3,925
Retained Earnings $10,502
c. Classified Balance Sheet as of December 31, 2020
Assets:
Current Assets:
Cash $20,397
Accounts Receivable 7,845
Prepaid Rent 3,205 $31,447
Long-term assets:
Equipment $18,975
Accumulated Depreciation 5,820 $13,155
Total assets $44,602
Liabilities and Equity:
Current liabilities:
Notes Payable 6,625
Accounts Payable 6,397
Interest Payable 153
Total liabilities $13,175
Equity:
Common Stock 20,925
Retained Earnings 10,502 $31,427
Total liabilities and equity $44,602
Explanation:
a) Data and Calculations:
GEORGE COOPER CO.
ADJUSTED TRIAL BALANCE DECEMBER 31, 2020
Debit Credit
Cash $20,397
Accounts Receivable 7,845
Prepaid Rent 3,205
Equipment 18,975
Accumulated Depreciation-Equipment $5,820
Notes Payable 6,625
Accounts Payable 6,397
Interest Payable 153
Common Stock 20,925
Retained Earnings 12,235
Dividends 3,925
Service Revenue 12,515
Salaries and Wages Expense 7,765
Rent Expense 2,190
Depreciation Expense 215
Interest Expense 153
Totals $64,670 $64,670
Clement Manufacturing Company uses two departments to make its products. Department I is a cutting department that is machine intensive and uses very few employees. Machines cut and form parts and then place the finished parts on a conveyor belt that carries them to Department II, where they are assembled into finished goods. The assembly department is labor intensive and requires many workers to assemble parts into finished goods. The companyâs manufacturing facility incurs two significant overhead costs: employee fringe benefits and utility costs. The annual costs of fringe benefits are $420,000 and utility costs are $300,000. The typical consumption patterns for the two departments are as follows:
Department I Department II Total
Machine hours used 20,000 4,000 24,000
Direct labor hours used 2,000 14,000 16,000
The supervisor of each department receives a bonus based on how well the department controls costs. The companyâs current policy requires using a single allocation base (machine hours or labor hours) to allocate the total overhead cost of $720,000.
Required
Assume that you are the supervisor of Department
a. Calculate the allocation base that would minimize your departmentâs share of the total overhead cost.
b. Calculate the allocation base that would minimize your departmentâs share of the total overhead cost.
c. Calculate the amount of overhead that would be allocated to both departments using the base that you selected.
d. Compute of allocation rates for total overhead cost
Answer:
Clement Manufacturing Company
a. As the supervisor of Department I:
Using direct labor hour as an allocation base minimizes my department's share of the total overhead cost to $90,000.
b. As the supervisor of Department II:
Using machine hour as an allocation base minimizes my department's share of the total overhead cost to $120,000.
c. Amount allocated to each department:
Single rate: Department I Department II
Machine hours $600,000 $120,000
Direct labor hours 90,000 630,000
d. Allocation rates for the total overhead cost:
Machine hours = $30 per machine hour ($720,000/24,000)
Direct labor hours = $45 per DLH ($720,000/16,000)
Explanation:
a) Data and Calculations:
Overhead costs:
Fringe benefits = $420,000
Utility costs = 300,000
Total overhead = $720,000
Department I Department II Total
Machine hours used 20,000 4,000 24,000
Direct labor hours used 2,000 14,000 16,000
Single allocation base
Machine hour = $720,000/24,000 machine hours
= $30 per machine hour
Direct labor hours = $720,000/16,000
= $45 per direct labor hour
Single rate: Department I Department II
Machine hours $600,000 $120,000
Direct labor hours 90,000 630,000
The best method:
ABC allocation basis: Department I Department II
Fringe benefits = $420,000 $52,500 $367,500 based on DLH
Utility costs = 300,000 250,000 50,000 based on MH
Total overhead = $720,000 $302,500 $417,500
You just got a job and plan to save for the college expenses for your kids. You have a son and a daughter. Your son is 4 years old, and your daughter is only 1 year old. Both of them plan to go to a four-year college at the age of 18. The estimated college expense is about $40,000 per year. Assume you plan to invest into a portfolio that offers you return about 6% per year until your daughter is graduated from college. How much money do you need to save every year if your first saving is in one year
Answer:
$11,508.25
Explanation:
your son will start college in 14 years, and the present value of his college tuition = $40,000 x 3.4651 (PVIFA, 6%, 4 periods) = $138,604
your daughter will start college in 17 years, so you need in today's dollars $138,604
you will need to save enough money to cover both tuitions;
money required to cover your son's tuition = $138,604 / 21.015 (FVIFA, 6%, 14 periods) = $6,595.48
money required to cover your daughter's tuition = $138,604 / 28.213 (FVIFA, 6%, 14 periods) = $4,912.77
total annual savings = $11,508.25
Cane Company manufactures two products called Alpha and Beta that sell for $210 and $172, respectively. Each product uses only one type of raw material that costs $8 per pound. The company has the capacity to annually produce 128,000 units of each product. Its unit costs for each product at this level of activity are given below :
Alpha Beta
Direct materials $40 $24
Direct labor $38 $34
Variable manufacturing overhead $25 $23
Traceable fixed manufacturing overhead $33 $36
Variable selling expenses $30 $26
Common fixed expenses $33 $28
Total cost per unit $199 $171
The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses are deemed unavoidable and have been allocated to products based on sales dollars.
Assume that Cane expects to produce and sell 113,000 Alphas during the current year. One of Cane's sales representatives has found a new customer that is willing to buy 28,000 additional Alphas for a price of $152 per unit. If Cane accepts the customer's offer, it will decrease Alpha sales to regular customers by 13,000 units.
a. Calculate the incremental net operating income if the order is accepted. (Loss amount should be indicated with a minus sign.)
b. Assume that Cane normally produces and sells 108,000 Betas per year. If Cane discontinues the Beta product line, how much will profits increase or decrease?
c. Assume that Cane normally produces and sells 58,000 Betas per year. If Cane discontinues the Beta product line, how much will profits increase or decrease?
d. Assume that Cane normally produces and sells 78,000 Betas and 98,000 Alphas per year. If Cane discontinues the Beta product line, its sales representatives could increase sales of Alpha by 11,000 units. If Cane discontinues the Beta product line, how much would profits increase or decrease?
e. Assume that Cane expects to produce and sell 98,000 Alphas during the current year. A supplier has offered to manufacture and deliver 98,000 Alphas to Cane for a price of $152 per unit. If Cane buys 98,000 units from the supplier instead of making those units, how much will profits increase or decrease?
f. Assume that Cane expects to produce and sell 73,000 Alphas during the current year. A supplier has offered to manufacture and deliver 73,000 Alphas to Cane for a price of $152 per unit. If Cane buys 73,000 units from the supplier instead of making those units, how much will profits increase or decrease?
Answer:
Cane Company
a) The incremental net operating income
= -$964,000
b. Profits would decrease by $3,132,000.
c. Profits would decrease by $1,682,000.
d. Profits would decrease by $1,778,000.
e. If Cane buys 98,000 units from the supplier instead of making those units, profits (savings) would increase by $588,000.
f. If Cane buys 73,000 units from the supplier instead of making those units, profits (savings) would increase by $438,000.
Explanation:
Products manufactured Alpha Beta
Selling price per unit $210 $172
Annual production capacity 128,000 $128,000
Units costs:
Direct materials $40 $24
Direct labor $38 $34
Variable manufacturing overhead $25 $23
Traceable fixed manufacturing overhead $33 $36
Variable selling expenses $30 $26
Common fixed expenses $33 $28
Total cost per unit $199 $171
Avoidable (Incremental) Costs:
Products manufactured Alpha Beta
Direct materials $40 $24
Direct labor $38 $34
Variable manufacturing overhead $25 $23
Traceable fixed manufacturing overhead $33 $36
Variable selling expenses $30 $26
Total incremental per unit $166 $143
Selling price per unit $210 $172
Contribution margin per unit $44 $29
Total Revenue for 28,000 at $152 per unit $4,256,000
Total avoidable cost for 28,000 at $166 (4,648,000)
Loss: Revenue due to decrease in regular
customers (13,000 *$210) 2,730,000
Total avoidable cost of 13,000 * $166 2,158,000 (572,000)
Operating loss if the order is accepted -$964,000
Beta:
Selling price per unit = $172
Incremental cost per unit = $143
Contribution per unit = $29
Total contribution margin = $3,132,000 ($29 * 108,000)
Total contribution margin = $1,682,000 ($29 * 58,000)
Total contribution margin = $2,262,000 ($29 * 78,000)
Increase in alpha contribution (484,000) ($44 * 11,000)
Loss of profit = $1,778,000
Cost price for outside supply = $152
Incremental unit cost (internal) $166
Difference in cost per unit $6
Profits increase from outside supplier = $6 * 98,000 = $588,000
Profits increase from outside supplier = $6 * 73,000 = $438,000
reported net income of $22,000 for the current year. During the year, Inventory decreased by $7,800, Accounts Payable decreased by $8,400, Long-term Notes Payable increased by $40,000, Depreciation Expense was $10,800, gain on the sale of a piece of equipment was $500 and Accounts Receivable increased by $6,900. If the indirect method is used to calculating the operating section on the Statement of Cash Flows, what is the net cash provided (used) by operating activities
Answer:
$24,800
Explanation:
Indirect method reconciles the Net Income to Operating Cash flow by adjusting for non -cash items previously included in net income and changes in working capital.
Cash flow from Operating Activities
Net income $22,000
Add Depreciation Expense $10,800
Less gain on the sale of equipment was ($500)
Decrease in Inventory $7,800
Decrease in Accounts Payable ($8,400)
Increase in Accounts Receivable ($6,900)
net cash provided operating activities $24,800
Therefore
The net cash provided (used) by operating activities is $24,800
Extend the application of a method or conclusion
a.Segmentation b.Extrapolate
c.Diffusion d.Multinational
Answer:
B - Extrapolate
Explanation:
Extrapolate means to extend the application of (a method or conclusion, especially one based on statistics) to an unknown situation by assuming that existing trends will continue or similar methods will be applicable.
The following table presents Generic Motors Company's production budget. GM's inventory policy is to have ending inventory equal to20% of next month's sales.
February March April
Ending inventory 5,000
Beginning inventory 2,000
Budgeted sales 13,000 17,000 18,000
Budgeted production
Required:
a) Fill in the missing numbers in the table above.
(Hint if you get stuck: What is the relation between ending inventory for one month and beginning inventory for the following month?)
b) Why do firms want to hold inventory of finished goods? (an alternative could be to produce exactly the amount they are going to sell, and hold zero inventories)
Answer:
a.
________________________________February__March__April
Ending inventory 20% of next Months sale _3400___3600__5,000
Beginning inventory__________________ 2,000__ 3400__ 3600
Budgeted sales _____________________ 13,000__17,000_ 18,000
Budgeted production_________________ 14,400__ 17,200_ 19,400
b.
Firms wants to hold the finished goods inventry in order to deal with the future demand
Explanation:
a.
Use the following formula to calculate the Budgeted production
Budgeted Production = Beginning Inventory - Ending Inventory + Busgeted Sales
Working
________________________________February__March__April
Ending inventory 20% of next Months sale _3400___3600__5,000
Less: Beginning inventory______________2,000__ 3400__ 3600
Add: Budgeted sales _________________ 13,000__17,000_ 18,000
= Budgeted production________________14,400__ 17,200_ 19,400
b.
The finished goods inventory is held to deal with the future market demand. If the firm produce the uniits equals o the current demand then in case of increase in demand or unexpected demand increase the firms will not be able to fulfil the demand and will lose the opportunity.
Brooke needs a $6,000 personal loan.
Which loan option would require her to pay back the least amount of money?
A)24-month loan with an 8% annual simple interest rate
B)36-month loan with a 6% annual simple interest rate
C)60-month loan with a 4% annual simple interest rate
S) 72-month loan with a 2 annual simple interest rate

20 POINTS!!!!
Answer: The answer is D 72-month loan with a 2 annual simple interest rate
Explanation:
A) 24x480=11,500 is incorrect
B) 36x360=12,960 is incorrect
C) 60x240=14,400 is incorrect
D) 72x120=8,640 is correct
I hope I wasn't too late to help. ;)
The loan option that would require her to pay back the least amount of money is: D) 72-month loan with a 2 annual simple interest rate.
Loan optionBased on the information given the loan option that would require her to pay back the least amount of money is 72-month loan with a 2 annual simple interest rate reason being that amount she will paid will be least amount compare to other loan options.
Loan=72 months ×($6,000×2%)
Loan=72 months×$120
Loan =$8,640
Inconclusion the loan option that would require her to pay back the least amount of money is: D) 72-month loan with a 2 annual simple interest rate.
Learn more about loan here:https://brainly.com/question/26011426
Quantitative Problem 1: You plan to deposit $2,400 per year for 5 years into a money market account with an annual return of 2%. You plan to make your first deposit one year from today. What amount will be in your account at the end of 5 years? Do not round intermediate calculations. Round your answer to the nearest cent. $ Assume that your deposits will begin today. What amount will be in your account after 5 years? Do not round intermediate calculations. Round your answer to the nearest cent. $ Quantitative Problem 2: You and your wife are making plans for retirement. You plan on living 30 years after you retire and would like to have $75,000 annually on which to live. Your first withdrawal will be made one year after you retire and you anticipate that your retirement account will earn 15% annually. What amount do you need in your retirement account the day you retire? Do not round intermediate calculations. Round your answer to the nearest cent. $ Assume that your first withdrawal will be made the day you retire. Under this assumption, what amount do you now need in your retirement account the day you retire? Do not round intermediate calculations. Round your answer to the nearest cent. $\
Answer:
$12,489.70
$492,448.47
Explanation:
We are to calculate the future value of the 5-year annuity
Future value = Amount x annuity factor
annuity factor = {[(1+r)^n] - 1} / r
r = interest rate
n = number of years
2400 x[ (1.02)^5 - 1] / 0.02 = $12,489.70
b. We are to calculate the present value of the 30-year annuity
Present value is the sum of discounted cash flows
Present value can be calculated using a financial calculator
Cash flow each year from year 1 to 30 = $75,000
I = 15%
PV = $492,448.47
To find the PV using a financial calculator:
1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.
2. after inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.
3. Press compute
For each of the following accounts indicate the effect of a debit or a credit on the account and the normal balance.
a. Salaries and Wages Payable select an option select an option select an option
b. Unearned Service Revenue select an option select an option select an option
c. Rent Revenue select an option select an option select an option
d. Prepaid Insurance select an option select an option select an option
e. Advertising Expense select an option select an option select an option
Answer:
dont be lonely
Explanation:
The factor-endowment theory predicts that because the United States is relatively abundant in capital and relatively scarce in labor, it will export capital-intensive goods, and its import-competing goods will be labor intensive. In the 1950s, Wassily Leontief, a Russian-American economist, tested this proposition by analyzing the capital/labor ratios of export industries and import-competing industries, using U.S. data. He found that the capital/labor ratio for U.S. export industries was lower than that of the United Statesâ import-competing industries, which means that U.S. exports were less capital intensive than import-competing goods. These findings appeared to contradict the predictions of the factor-endowment theory and became known as the Leontief paradox.
Replicate Leontief's test using the date shown in the following table. Compute the ratio for exports and imports, and enter each value in the last column of the table.
Used to produce $1 Million Worth of⦠Capital (Dollars) Labor(Person-years) Capital/ Labor Ratio (Dollars per person- year)
Exports 1,800,000 80
Imports 3,000,000 100
The numbers in the previous table show that US. exports are __________ and U.S. imports are_________
What do the results of your test illustrate? Check all that apply.
a. The Leontief paradox
b. The Heckschner-Ohlin theory
Answer:
exports are low
imports are high
a. The Leontief paradox
Explanation:
Leontief paradox is a theory in economics which states that countries with higher capital per worker has lower capital / labor ratio in export as compared to imports. U.S. has same ratio as the ratio of capital/labor for imports is high and the ratio is lower for exports. The given results are according to The Leontief Paradox.
Sam bought brushes for $8, a palette for $5, and oil paints for $15. He paid $29.82 in all. What sale-tax rate did Sam pay?
A.
0.06%
B.
0.65%
C.
6.5%
Answer:
Explanation:
Select the correct answer.
Sam bought brushes for $8, a palette for $5, and oil paints for $15. He paid $29.82 in all. What sales tax rate did Sam pay?
A.
0.06%
B.
0.65%
C.
6.5%
6.5 i correct
You want to save at least $10,000 for a down payment on a new car. In cell B6, enter a formula to calculate how much you will have saved by putting away $500 per month for 24 months at a 1.5% annual interest rate. Use the appropriate cell references. Remember to use a negative value for the Pmt argument. There is no money in the account yet and payments are applied at the end of every month, so omit both the Pv and Type arguments. (Hint: Use the FV function.)
Answer:
$14,316.76
Explanation:
How much you will have saved?
Using MS Excel to calculate the FV function
= FV(Rate, Nper, Pmt)
= FV(1,5%, 24, 500)
= 14316.7604
= $14,316.76
So, the total amount you will have saved by putting away $500 per month for 24 months at a 1.5% annual interest rate is $14,316.76
The lowest point in a business cycle, which follows a period of economic
decline, is called a(n)
Answer:
Depression/Trough
Explanation:
The lowest point in a business cycle is called depression (or trough). At this point, the unemployment rate would be the highest and the investment/consumption level would be very low. The price level would also be low.
Sarasota Company sells on credits goods that cost $310,000 to Ricard Company for $409,500 on January 2, 2020. The sales price includes an installation fee, which has a standalone selling price of $42,500. The standalone selling price of the goods is $367,000. The installation is considered a separate performance obligation and is expected to take 6 months to complete. (a) Prepare the journal entries (if any) to record the sale on January 2, 2020
Answer and Explanation:
The journal entries are shown below:
Account Receivable $409,500
To Sales Revenue $367,000
To Unearned Service Revenue $42,500
(Being account receivable is recorded)
Cost of Goods Sold $310,000
To Merchandised Inventory $310,000
(Being cost of goods sold is recorded)
These two journal entries are to be recorded