Answer:
16,002
Explanation:
A company has the following budget information
Sales = $118,000
COGS= $48,500
Depreciation expense= $1,500
Interest expense= $250
Other expense= $41,880
The company budgets 40% for income tax expense
= 40/100
= 0.4
The first step is to calculate the total expense incurred in the company
Total expense= COGS+depreciation expense+Interest expense+Other expenses
= $48,500+$1,500+$250+$41,880
= $92,130
The next step is to calculate the pre-tax income
Pre-tax income= Sales-total expenses
= $118,800-$92,130
= $26,670
The next step is to calculate the income tax expense
Income tax expense= $26,670×0.4
= $10,668
Therefore, the budgeted net income can be calculated as follows
Budgeted net income= Pre-tax income-income tax expense
= 26,670-10,668
= 16,002
Hence the budgeted net income is 16,002
kerch co. had beginning net fixed assets of $216,566, ending net fixed assets of $211,729, and deperciation of $40,477. During the year, the company sold fixed assets with a book value of $8,014. How much did the company purchase in new fixed assets?
a) $32,224
b) $43,639
c) $41,476
d) $35,625
e) $34,293
Answer:
The closest option is B,$43,639
Explanation:
The formula for ending net fixed assets can be used to determine the value of new purchase as shown below:
ending net fixed assets= beginning net fixed assets-depreciation-cost of asset sold+new purchase
$211,729=$216,566-$40,477-$8,014+x
$211,729=$168075 +x
x=$211,729-$168075
x=$43654
The closest option is B
Coronado, Inc. had net sales in 2017 of $1,493,700. At December 31, 2017, before adjusting entries, the balances in selected accounts were Accounts Receivable $329,800 debit, and Allowance for Doubtful Accounts $4,060 credit. If Coronado estimates that 9% of its receivables will prove to be uncollectible. Prepare the December 31, 2017, journal entry to record bad debt expense.
Answer:
December 31,
DR Bad Debt Expense $25,622
CR Allowance for Doubtful Accounts $25,622
Explanation:
The Allowance for Doubtful Accounts helps provide a sort of cushion for the business by accounting for potential bad debts for the business so that if bad debts occur, they are taken from this account and not the Receivables account.
Coronado estimates that 9% of receivables will be uncollectible so;
= 9% * 329,800
= $29,682
However, $4,060 is already in the account so the new balance that should be brought into the account to ensure that it totals $29,682 is;
= 29,682 - 4,060
= $25,622
Suppose that the government immediately pursues an _____________ policy by increasing government purchases in response to the short-run economic impact of the higher oil prices.
Answer:
The answer to the blank space is: expansionary fiscal policy
Explanation:
Expansionary fiscal policy consists in either the increase of government purchases (fiscal spending), or the reduction of taxes, or both.
Expansionary fiscal policy is recommended when the economy is experiencing a downturn, and can be helpful in reducing the damage that the economic slump generates.
In the case of the question, higher oil prices for an importing country will result in less economic activity because this important fuel becomes more expensive, both for manufacturing, agriculture and services. For this reason, the government responds by increasing spending with the goal of reactivating the economy as soon as possible, and reducing the damange that was already done.
مطلوب
If personal saving is -$17billion and .1
disposable personal income is $370 billion,
* then personal consumption spending
(2 نقطة)
Answer:
Personal consumption spending = $387 billion
Explanation:
Given:
Personal saving = -$17 billion
Personal income = $370 billion
Find:
Personal consumption spending
Computation:
Personal consumption spending = Personal income - (Personal saving)
Personal consumption spending = $370 billion - (-$17 billion)
Personal consumption spending = $387 billion
For this discussion, you are to pretend that you're on a team project that's running behind schedule. Let's say you and your project team are three months into an eight-month project and you realize that you're already 2.5 weeks behind schedule and 15% over budget. What would you do?
Answer:
Explanation:
The discussion or focus is on PROJECT MANAGEMENT.
You are on a team project that is running behind schedule. You and your project team are 3 months into an 8-month project.
There is a deficiency in both time management and money management.
For the project to be 3 months old, out of 8 months, then it's already in the execution stage.
Being behind schedule by 2.5 weeks implies that you have spent 2.5 weeks extra, achieving what you ought to achieve without or before the extra time. Discuss with your project team and make them more active in delivering their tasks. Time is crucial. Time is money also.
You're 15% over budget, hence you've spent 15% more than you should. Check the vendors of items and tools used in the project. You might have to change them if their products are too costly. Ensure proper accounting also. Do not disburse funds without the consultation and approval of team members who are finance experts.
In all, not more than 2 days or thereabout should be used in making these adjustments because time and money are equally pertinent!
On August 1, Blossom Company buys 1,000 shares of BCN common stock for $44,100 cash. On December 1, the stock investments are sold for $45,700 in cash. Journalize the purchase and sale of the common stock
Answer and Explanation:
The Journal entry is shown below:-
1. Stock Investments Dr, $44,100
To Cash $44,100
(Being purchase of stock investment is recorded)
Here we debited the stock investment as the purchase is done and we credited the cash as it decreased the asset
2. Cash Dr, $45,700
To Stock Investments $44,100
To Gain on sale of stock Investments $1,600
(Being sale of stock investment is recorded)
Here we debited the cash as it increased the asset and we credited the stock investment and gain on sale of stock investment as there is a sale of common stock
An investment earns 35% the first year, earns 40% the second year, and loses 37% the third year. The total compound return over the 3 years was ______. Multiple Choice 158.93% 19.07% 38.00% 6.36%
Answer:
19.07%
Explanation:
The computation of the total compound return over the 3 years is shown below:
= (1 + investment percentage earned in first year) × (1 + investment percentage earned in second year) × (1 + investment percentage loss in second year)
= (1 + 0.35) × (1 + 0.40) × (1 - 0.37)
= 1.35 × 1.40 × 0.63
= 1.1907
= 19.07%
Horizon Financial Inc. was organized on February 28. Projected selling and administrative expenses for each of the first three months of operations are as follows: March $173,900 April 163,500 May 148,800 Depreciation, insurance, and property taxes represent $37,000 of the estimated monthly expenses. The annual insurance premium was paid on February 28, and property taxes for the year will be paid in June. 70% of the remainder of the expenses are expected to be paid in the month in which they are incurred, with the balance to be paid in the following month. Required:Prepare a schedule of cash payments for selling and administrative expenses for March, April, and May. Horizon Financial Inc.
Answer:
Total Cash Payments are as follows:
For March = $95,830
For April = $129,620
For May = $116,210
Explanation:
Note: See the attached Excel file for the schedule of cash payments
The expenses paid in each month can be calculated as follows:
a. March Expenses
Paid in March = (Total projected selling and administrative expenses for March - Depreciation, insurance, and property taxes for March) * Percentage of reminder paid = ($173,900 - $37,000) * 70% = $95,830
Paid in April = (Total projected selling and administrative expenses for March - Depreciation, insurance, and property taxes for March) * Percentage of balance paid = ($173,900 - $37,000) * (100% - 70%) = $41,070
b. April Expenses
Paid in April = (Total projected selling and administrative expenses for April - Depreciation, insurance, and property taxes for April) * Percentage of reminder paid = ($163,500 - $37,000) * 70% = $88,550
Paid in May = (Total projected selling and administrative expenses for April - Depreciation, insurance, and property taxes for April) * Percentage of balance paid = ($173,900 - $37,000) * (100% - 70%) = $37,950
c. May Expenses
Paid in May = (Total projected selling and administrative expenses for May - Depreciation, insurance, and property taxes for May) * Percentage of reminder paid = ($148,800 - $37,000) * 70% = $78,260
The original cost of the machine was $1,800,000. The machine has a class life of 15 years, but after 13 years, the firm has decided to sell the machine for $320,000. If Monster Potato has a marginal tax rate of 21%, what is the tax effect associated with the decision?
Answer: $16,800 tax payment.
Explanation:
Annual depreciation on machine = [tex]\frac{1,800,000}{15}[/tex]
= $120,000
Accumulated Depreciation in 13 years;
= 120,000*13
= $1,560,000
Book Value at 13 years
= 1,800,000 - 1,560,000
= $240,000
Company sold it at a higher price than its book value so there will be a capital gain of;
= 320,000 - 240,000
= $80,000
Tax is charged on the marginal gain;
= 80,000 * 21%
= $16,800
Direct Materials Purchases Budget
Tobin’s Frozen Pizza Inc. has determined from its production budget the following estimated production volumes for 12'' and 16'' frozen pizzas for November:
Units
12" Pizza 16" Pizza
Budgeted production volume 70,000 50,000
There are three direct materials used in producing the two types of pizza. The quantities of direct materials expected to be used for each pizza are as follows:
12" Pizza 16" Pizza
Direct materials:
Dough 0.55 lb. per unit 0.80 lb. per unit
Tomato 0.25 0.40
Cheese 0.70 1.20
In addition, Tobin’s has determined the following information about each material:
Dough Tomato Cheese
Estimated inventory, November 1 2,500 lbs. 1,000 lbs. 3,000 lbs.
Desired inventory, November 30 2,000 lbs. 1,200 lbs. 2,800 lbs.
Price per pound $0.50 $0.60 $0.85
Prepare November’s direct materials purchases budget for Tobin’s Frozen Pizza Inc. For those boxes in which you must enter subtracted or negative numbers use a minus sign.
Tobin’s Frozen Pizza Inc.
Direct Materials Purchases Budget
For the Month Ending November 30
Direct Materials Direct Materials Direct Materials
Dough Tomato Cheese Total
Units required for production:
12" pizza
16" pizza
Desired inventory, November 30
Total units available
Estimated inventory, November 1
Total units to be purchased
Unit Price x $ x $ x $
Total direct materials to be purchased $ $ $ $
Answer:
Since there is not enough room here, I prepared an excel spreadsheet
Explanation:
Exhibit 24-4 Price Quantity Demanded Total Fixed Cost Total Variable Cost Total Revenue Total Cost Marginal Revenue Marginal Cost $50 0 $8 $0 (C) (H) 45 1 8 20 (D) (I) (L) (R) 40 2 (A) 30 (E) (J) (M) (S) 35 3 8 55 105 63 (N) (T) 30 4 8 (B) (F) 93 (P) (U) 25 5 8 125 (G) (K) (Q) (V) Refer to Exhibit 24-4. What dollar amounts go in blanks (F), (G), (H), (I), and (J), respectively
Answer:
F = Total Revenue at 4 units
= Price * Quantity demanded
= 30 * 4
= $120
G = Total Revenue at 5 units
= Price * Quantity demanded
= 30 * 5
= $150
H = Total Cost at 0 units
= Fixed Costs + Variable Costs
= 8 + 0
= $8
I = Total Cost at 1 unit
= Fixed Costs + Variable Costs
= 8 + 20
= $28
J = Total Cost at 2 units
= Fixed Costs + Variable Costs
Fixed costs are fixed at $8 so (A) is $8
= 8 + 30
= $38
The following information is from the annual financial statements of Raheem Company. Year 3 Year 2 Year 1 Net sales $ 308,000 $ 239,000 $ 289,000 Accounts receivable, net (year-end) 37,700 35,500 32,200 (1) Compute its accounts receivable turnover for Year 2 and Year 3. (2) Assuming its competitor has a turnover of 12.6, is Raheem performing better or worse at collecting receivables than its competitor? Better Worse
Answer:
(1) Compute its accounts receivable turnover for Year 2 and Year 3.
year 2 = 7.06year 3 = 8.42(2) Assuming its competitor has a turnover of 12.6, is Raheem performing better or worse at collecting receivables than its competitor?
the higher the accounts receivable turnover ratio, the better. In this case, their competitor is much better at collecting their accounts receivables than Raheem.Explanation:
Year 3 Year 2 Year 1
Net sales $308,000 $239,000 $289,000
Accounts receivable, net (year-end) $37,700 $35,500 $32,200
accounts receivable turnover = net sales / average accounts receivable
accounts receivable turnover year 2 = 239,000 / [(35,500 + 32,200)/2] = 7.06
accounts receivable turnover year 3 = 308,000 / [(35,500 + 37,700)/2] = 8.42
Jan's Bakery is considering a merger with Tina's Cookies. Jan's total operating costs of producing services are $300,000 for a sales volume of $2 million. Tina's total operating costs of producing services are $75,000 for a sales volume of $600,000. If the two firms merge, calculate the total average cost for the merged firm assuming no synergies.
Answer:
Jan's Bakery and Tina Cookies
Total Average Cost for the merged firm
= ($300,000 + $75,000)/2
= $187,500
Explanation:
The total average cost for Jan's Bakery and Tina's Cookies is the average of their total operating costs. This is obtained by adding $300,000 to $75,000 and then dividing by 2.
Though, in practical terms, the presence of some synergies will cut some of the operating costs off, especially such costs as rent, advertising, and some other administrative costs. Some selling costs will also be eliminated when the merger goes through.
The following data relate to direct materials costs for February: Materials cost per yard: standard, $1.98; actual, $2.03 Standard yards per unit: standard, 4.69 yards; actual, 4.93 yards Units of production: 9,300 Calculate the direct materials price variance.
Answer:
-$2,292.45 Unfavorable
Explanation:
According to the given situation, the computation of direct materials price variance is shown below:-
Material price variance = (Standard price - Actual price) × Actual quantity
= ($1.98 - $2.03) × 9,300 × 4.93
= -$0.05 × 9,300 × 4.93
= -$2,292.45 Unfavorable
Therefore for computing the material price variance we simply applied the above formula.
The manager of a gas station noticed that when prices in the convenience store of the gas station decreased, gas sales increased. This could possibly be because the convenience store products are
Answer:
usually complements to the gas sales
Explanation:
Complementary products are those that their demand increases with the increased demand of other products.
Complementary products are usually used together. For example tea and sugar are consumed together, so an increase in tea consumption should result in an increase in sugar consumption.
In this scenario when the price of the convenience store products falls, their demand will increase. If there is an increase in gas sales too it is logical to conclude that the convenience store goods are complements of gas sales.
Cheyenne Repair Shop had the following transactions during the first month of business as a proprietorship. Journalize the transactions. (If no entry is required, select "No entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Aug. 2 Invested $11,290 cash and $2,740 of equipment in the business. 7 Purchased supplies on account for $450. (Debit asset account.) 12 Performed services for clients, for which $1,303 was collected in cash and $689 was billed to the clients. 15 Paid August rent $634. 19 Counted supplies and determined that only $263 of the supplies purchased on August 7 are still on hand. Date Account Titles and Explanation Aug. 12
Answer:
1200
Explanation:
The bank deputy controls the money so then cheyenne repair shop fixes the money through the transactions with the amounting equivalent to the equilibrium of the bank and the transactions so you end up with 1200
Multinational enterprises (MNEs) have an impact far beyond their firm boundaries. Assume you are working for a small firm that supplies a product or service to an MNE. How might your relationship change as the MNE moves from Globalization 2.0 to Globalization 3.0 operations?
Answer:
Multinational enterprises (MNEs)
Relationship Change as the MNE moves from Globalization 2.0 to Globalization 3.0 operations:
This move means that Indian and Chinese companies would be competing with my local small firm. The MNE may be looking for cheaper prices for my company's products and services, which the Indian and Chinese companies would more efficiently supply it. My firm may be on the precipice of liquidating if this MNE is our major customer. My firm must move fast to become more competitive by differentiating our products and services with better quality and perhaps reduced production costs, to enable it compete more favorably with the Indian and Chinese competitors. Otherwise, we may regard the relationship as nearing its end and prepare for other opportunities with other companies.
Explanation:
Globalization reduces national boundaries by integrating national economies into a globalized economy, thus enabling companies to compete globally for financial resources, goods, and services. When Globalization 1.0 happened, countries were globalized and the world became a global village. When Globalization 2.0 from which the G7 profited largely, companies were globalized. With the current Globalization 3.0, individuals are being globalized, and the highest beneficiaries are Indian and Chinese nationals who appear better prepared to take on the world, garner most of the important resources to themselves, and call the shots from the boardrooms. An example is Microsoft's current CEO, Satya Nadella, who is an Indian-American.
Mary just bought a 20-year bond with an 8% coupon rate (paid semi-annually) and $1000 par value for $1050. She is expecting an effective annual yield (EAY) of
Answer:
7.65%
Explanation:
Calculation for Mary effective annual yield (EAY)
The first step is to find the Semiannual coupon payment using this formula
Semiannual coupon payment=(Par value×Coupon rate percentage/2)
Let plug in the formula
Semiannual coupon payment =($1,000 × 8%) ÷2
Semiannual coupon payment= $80 ÷ 2 = $40
Second step is to find The total number of compounding period will be 20 years bond × The number of the compounding period er year which is 2
Hence,
The total number of compounding period will= 2 periods per year × 20 years = 40 periods.
Third step is to use the financial calculator which calculated the rate as 3.76% which means that:
Semiannual yield will be :3.76%
Therefore the Annual yield will be calculatedas = 3.76% ×2
Annual yield= 7.51%
The last step is to find the effective annual yield (EAY) using this formula
EAY = [1+(Quoted interest rate / m]m -1
Let plug in the formula
EAY = [1+(0.0751÷2)]2 -1
EAY= 7.65%.
Therefore the effective annual yield (EAY) will be 7.65%
The classification of a result refers to the category of the Business/POI. When would you consider the classification incorrect? Answer When the classification is misspelled When the classification is misleading When the classification is in an unexpected language or script All of the above
Answer: All of the above
Explanation:
The classification of a result refers to the category of the Business/POI and this classification would be considered to be incorrect when the classification is misspelled, when the classification is misleading or in a situation whereby the classification is in an unexpected language or script.
Therefore, the correct option is All of the above.
Many leaders have difficulty implementing their vision and strategies. Such problems may stem from a variety of issues in the design of the organization such as
Answer:
Inappropriate budgeting and control system
Explanation:
If there is no proper budgeting with respect to the revenues, expenses and also if there is no proper control than the implementation of the vision and strategies would become difficult due to which organization is not able to accomplish its goals and objective within a prescribed time
There should be proper structure of work by considering the budgeting and control system as if any organization would ignore this then they would lead to suffered high losses
Therefore as per the given scenario, the third option is correct
Answer:
inappropriate budgeting and control systems is the correct answer.
Explanation:
Exercise 11-1 Compute the Return on Investment (ROI) [LO11-1] Alyeska Services Company, a division of a major oil company, provides various services to the operators of the North Slope oil field in Alaska. Data concerning the most recent year appear below: Sales $ 17,800,000 Net operating income $ 5,000,000 Average operating assets $ 35,800,000 Required: 1. Compute the margin for Alyeska Services Company. (Round your answer to 2 decimal places.) 2. Compute the turnover for Alyeska Services Company. (Round your answer to 2 decimal places.) 3. Compute the return on investment (ROI) for Alyeska Services Company. (Round your intermediate calculations and final answer to 2 decimal places.)
Answer:
1. 28.09 %
2.0.50 times
3.13.97 %
Explanation:
Margin = Profit / Sales × 100
= $ 5,000,000 / $ 17,800,000 × 100
= 28.09 % (2 decimal places.)
Turnover = Sales / Total Assets
= $ 17,800,000 / $ 35,800,000
= 0.50 times (2 decimal places.)
Return on investment = Divisional Profit Contribution / Assets employed in the division × 100
= $ 5,000,000 / $ 35,800,000 × 100
= 13.97 % (2 decimal places.)
Product differentiation is a key component of monopolistic competition. Given the following scenarios, label them accordingly by how products are differentiated.
GrrrArg! Productions attempts to carve out a niche in the crowded zombie film industry by specializing in movies featuring only finger -puppet zombies._______
Jay is a Korean pop star, and as such, he has long, flowing hair. One day, he decides to retire from the singing industry and walks to the local Products right outside his apartment, despite it being more expensive than the Supercuts 10 minutes away.________
Wayne is a beginning photographer. He is in the market to buy a new camera lens and notes that certain lenses take clearer pictures but they become exponentially more expensive to purchase as the sharpness of the image increases. He chooses to start with the lowest grade lens (i.e. the cheapest)._________
The video game industry caters to a wide array of people, with games like Final Fantasy to appeal to the role playing type, Tekken for those who like fighting games, Halo for the first person shooters, and Super Mario for the adventurous.__________
Answer:
1. differentiated by style or type
2. differentiated by Location
3. differentiated by quality
4.differentiated by style or type
Explanation:
For creating a monopoly in a market place first thing the firm should do is to introduce their unique product so the chances of the competition could be less
Here are the cases given, based on this, the type of product differentiation is as follows
a. In the first case, the differentiation in the product is done by style or by type
b. In the second case, the differentiation in the product is done by location as the two locations are given in the question
c. In the third case, the differentiation in the product is done by quality as the discussion is for the cameral lens i.e cheap and expensive one
d. In the fourth case, the differentiation in the product is done by style or by type as the different person has different playing roles
Which one of these is not a smart way to negotiate? Make counteroffers by phone or in person, so you can use your powers of persuasion Go in knowing the maximum you’re willing to pay Learn about the seller’s needs and try to accommodate them Add a personal letter to your offer
Answer:
Add a personal letter to your offer.
Explanation:
Negotiation is when an agreement or a compromise is reached by parties involved in a deal in order to avoid issues or argument. People negotiate for different reasons such as beating down a price , resolve a problem or dispute among parties, create a new thing in which parties involved are not able to do , or agree on how to share limited resource like money, assets etc.
Negotiation is a skill(soft)which can be learnt by people hence become a strong negotiator. These soft skills include communication, persuasion and ability to strategize . With regards to the above, the odd among the given option is add a personal letter to your offer.
The one of among the options that is not a smart way to negotiate is addition of a personal letter to your offer.
For better understanding, let's explain what negotiation means
Negotiation is simply defined as a continuous working together of two or more parties in order to reach an agreement that is mutually satisfactory especially to both buyer and seller or an others. There are three phases to negotiation which are planning and preparation, Settlement and Documentation.Negotiating Tactics includes bidding war, brinksmanship, one party away, bogey--tactic, bluffing, defense in depth, flinching, Highball/Lowball and others. Personal letter is not inclusive.From the above, we can therefore say that the answer that The one of among the options that is not a smart way to negotiate is addition of a personal letter to your offer is correct
Learn more about negotiation from:
https://brainly.com/question/9169212
Select a problem that a firm might have bringing out a new product or service and discuss how the firm could overcome that problem.
Explanation:
A potentially serious problem for a company is to launch a new product or service on the market without conducting marketing research to investigate the acceptance of its product to its target audience.
Marketing research is an essential tool for a company to collect relevant data and information about what the consumers' needs and desires are, what benefits they expect from a product or service, what features the product should have, the design, the price, and several other essential variables to help the company better understand the market and make the best decisions when launching a new product
For each ratio listed, identify whether the change in ratio value from 2014 to 2015 is usually regarded as favorable or unfavorable.
Ratio 2015 2014
1. Profit margin 9% 8%
2. Debt ratio 47% 42%
3. Gross margin 34% 46%
4. Acid-test ratio 1.00 1.15
5. Accounts receivable turnover 5.5 6.3
6. Bank earnings per share $1.25 $1.58
7. Inventory turnover 3.6 3.4
8. Dividend payout 2.0% 1.2%
Answer:
1. Favorable
2. Unfavorable
3. Unfavorable
4. Favorable
5. Favorable
6. Unfavorable
7. Favorable
8. Favorable
Explanation:
1. Favorable
Less Profit is now being earned per sale
2. Unfavorable
More Debt more Financial risk
3. Unfavorable
Less Profit is now being earned per sale
4. Favorable
A lower ratio is good shows efficiency utilization of resources
5. Favorable
The company is efficient in collection of debt
6. Unfavorable
The earning per share is lower
7. Favorable
More efficient in inventory management
8. Favorable
More return given to investors
A consumer values a house at $525,000 and a producer values the same house at $485,000. If the transaction is completed at $510,000, what amount of tax will result in unconsummated transaction? a. A tax of $14,000 b. A tax of $15,000 c. A tax of $9,000 d. A tax of $18,000
Answer:
d. A tax of $18,000
Explanation:
If the price is higher than $525,000 which is his reservation price, the buyer will not buy the good
(1+t) > $525,000 / $510,000
1+t > 1.03
t > 0.03
t > 3%
3% of $510,000 = $15,300. So if the tax is greater than $15,300, the buyer will not buy the good . Hence, the answer is option (D) A tax of $18,000 as this tax is higher than $15,300 while other option are less than $15,300
You are pitching a marketing proposal to a company that sells electronic equipment. For a particular product line, their current sales price is $20 per unit, cost is $9 per unit and they have $20,000 in fixed costs associated with this line. Last year, they sold 8,200 units. You are proposing that the company implement your marketing plan which will cost $3,000 per year. You believe this will increase their sales units by 350 units. Calculate the contribution margin ratio at the projected levels, the projected change in operating income of your proposal and the projected ROI. Additionally, if the company requires a 12% return on its investments, calculate the maximum you could charge for your marketing plan.
Answer:
without marketing with marketing differential
plan plan amount
total sales 8,200 8,550 350
sales revenue $164,000 $171,000 $7,000
variable costs ($73,800) ($76,950) ($3,150)
contribution $90,200 $94,050 $3,850
margin
contribution 55% 55% -
margin ratio
fixed and ($20,000) ($23,000) ($3,000)
marketing costs
operating $70,200 $71,050 $850
income
The return on investment (ROI) from your marketing plan = $850 / $3,000 = 28.33%
If the required ROI is 12%, then you could charge = net increase in operating profits / (1 + required ROI) = $3,850 / 1.12 = $3,437.50
Ayala Inc. has conducted the following analysis related to its product lines, using a traditional costing system (volume-based) and an activity-based costing system. Both the traditional and the activity-based costing systems include direct materials and direct labor costs Total Costs
Products Sales Revenue Traditional ABC
Product 540X $201,000 $56,000 $45,600
Product 137Y 159,000 55,000 25,000
Product 249S 89,000 15,000 55,400
Required:
1. For each product line, compute operating income using the traditional costing system
2. Compute operating income using the activity-based costing system
Answer:
1) Part 1. Operating Income = Revenue - Operating cost
=201,000 - 56,000
=$145,000
Part 2. Operating Income = Revenue - Operating cost
= 159,000 - 55,000
= $104,000
Part 3. Operating Income = Revenue - Operating cost
= 89,000 - 15,000
=$74,000
2. Part 1. Operating Income = Revenue - Operating cost
=201,000 - 45,600
=$155,400
Part 2. Operating Income = Revenue - Operating cost
=159,000 - 25,000
=$134,000
Part 3. Operating Income = Revenue - Operating cost
=89,000 - 55,400
=$33,600
Richards Corporation uses the weighted-average method of process costing. The following information is available for October in its Fabricating Department: Units: Beginning Inventory: 100,000 units, 80% complete as to materials and 25% complete as to conversion. Units started and completed: 290,000. Units completed and transferred out: 390,000. Ending Inventory: 40,000 units, 40% complete as to materials and 10% complete as to conversion. Costs: Costs in beginning Work in Process - Direct Materials: $57,200. Costs in beginning Work in Process - Conversion: $99,700. Costs incurred in October - Direct Materials: $828,520. Costs incurred in October - Conversion: $939,300. Calculate the cost per equivalent unit of materials.
Answer:
$2.64 per units
Explanation:
The computation of the cost per equivalent unit of material is shown below:
Cost per equivalent unit is
= (Beginning conversion cost + cost incurred during October) ÷ (Total equivalent units)
= ($99,700 + $939,300) ÷ (390,000 units + (40,000 units × 10%))
= $1,039,000 ÷ 394,000 units
= $2.64 per units
We simply applied the above formula
"The Master Manufacturing Company has just announced a tender offer for its own common stock. Master is offering to buy up to 100% of the company's stock at $20 per share contingent on at least 64% of the outstanding shares being tendered. After the announcement of the offer, the stock closed on the NYSE up 2.50 at $18.75. If a customer had 100 shares and sold at tomorrow's opening price, what is the price that he would receive per share?"
Answer:
$0
Explanation:
As it is mentioned in the question that 64% of shares being tendered so at this condition the client has no confirmation with respect to the amount paid for the shares after deciding the tender
Therefore in the given case, the price received per share would be $0 and the other information i.e mentioned in the question is not relevant. Hence, ignored it