Answer:
B. Accept X and reject Y
Explanation:
Here are the options
A. Accept both X and Y
B. Accept X and reject Y
C. Reject X and accept Y
D. Reject both X and Y
E. The answer cannot be determined based on the information provided
the project should be accepted if the WACC of the department is less than the rate of return on the project
WACC = weight of equity x cost of equity + weight of debt x after tax cost of debt
weight of debt = D / (D + E) = 0.45E /1.45E
weight of equity = E / (D + E) = E / 1.45E
WACC = ( 0.45E /1.45E) x (5.1) + ( E / 1.45E) x 14.7
= 5.1 x (0.45/1.45) + 14.7 x (1/1.45)
=1.583 + 10.138
11.72%
Division X's WACC = 11.72% - 0.5% = 11.22%
Division Y's WACC = 11.72% + 1% = 12.72%
The rate of return of Division Y's project is 12.3%. Thus, division Y's project should not be accepted
the rate of return of Division X's project is 11.64%. Thus, division X's project should be accepted
The budget director for Kanosh Cleaning Services prepared the following list of expected selling and administrative expenses. All expenses requiring cash payments are paid for in the month incurred except salary expense and insurance. Salary is paid in the month following the month in which it is incurred. The insurance premium for six months is paid on October 1. October is the first month of operations; accordingly, there are no beginning account balances.
Required Complete the schedule of cash payments for S&A expenses by filling in the missing amounts.
Determine the amount of salaries payable the company will report on its pro forma balance sheet at the end of the fourth quarter.
Determine the amount of prepaid insurance the company will report on its pro forma balance sheet at the end of the fourth quarter.
October November December
Budgeted S&A Expenses
Equipment lease expense $7,500 $7,500 $7,500
Salary expense 8,200 8,700 9,000
Cleaning supplies 2,800 2,730 3,066
Insurance expense 1,200 1,200 1,200
Depreciation on computer 1,800 1,800 1,800
Rent 1,700 1,700 1,700
Miscellaneous expenses 700 700 700
Total operating expenses $23,900 $24,330 $24,966
Schedule of Cash Payments for S&A Expenses
Equipment lease expense
Prior month’s salary expense, 100%
Cleaning supplies
Insurance premium
Depreciation on computer
Rent
Miscellaneous expenses
Total disbursements for operating expenses $19,900 $20,830 $21,666
b. Salaries payable
c. Prepaid insurance
Answer:
Kanosh Cleaning Services
a. Schedule of Cash Payments for S&A Expenses
October November December
Equipment lease expense $7,500 $7,500 $7,500
Prior month’s salary expense, 100% 0 8,200 8,700
Cleaning supplies 2,800 2,730 3,066
Insurance premium 7,200 0 0
Depreciation on computer 0 0 0
Rent 1,700 1,700 1,700
Miscellaneous expenses 700 700 700
Total disbursements for operating expenses $19,900 $20,830 $21,666
b. Salaries payable = $9,000
c. Prepaid insurance = $3,600
Explanation:
a) Data and Calculations:
October November December
Budgeted S&A Expenses
Equipment lease expense $7,500 $7,500 $7,500
Salary expense 8,200 8,700 9,000
Cleaning supplies 2,800 2,730 3,066
Insurance expense 1,200 1,200 1,200
Depreciation on computer 1,800 1,800 1,800
Rent 1,700 1,700 1,700
Miscellaneous expenses 700 700 700
Total operating expenses $23,900 $24,330 $24,966
Schedule of Cash Payments for S&A Expenses
October November December
Equipment lease expense $7,500 $7,500 $7,500
Prior month’s salary expense, 100% 0 8,200 8,700
Cleaning supplies 2,800 2,730 3,066
Insurance premium 7,200 0 0
Depreciation on computer 0 0 0
Rent 1,700 1,700 1,700
Miscellaneous expenses 700 700 700
Total disbursements for operating expenses $19,900 $20,830 $21,666
b. Salaries payable = $9,000
c. Prepaid insurance = $3,600 ($7,200 - $3,600)
a. See the attached photo for the complete schedule of cash payments for S&A expenses.
Under the complete schedule of cash payments for S&A expenses in the attached photo, the following are determined as follows:
Insurance premium paid in October = Monthly insurance expense * 6 months = $1,200 * 6 months = $7,200
Depreciation on computer = This is zero for each of the month because depreciation is not a cash expense.
b. Salaries payable = Salary expense for December = $9,000
c. Prepaid insurance = 6 months insurance premium paid – (October insurance expense + November insurance expense + December insurance expense) = $7,200 – ($1,200 + $1,200 + $1,200) = $7,200 - $3,600 = $3,600
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Gelb Company currently manufactures 52,500 units per year of a key component for its manufacturing process. Variable costs are $4.05 per unit, fixed costs related to making this component are $65,000 per year, and allocated fixed costs are $75,500 per year. The allocated fixed costs are unavoidable whether the company makes or buys this component. The company is considering buying this component from a supplier for $3.50 per unit. Calculate the total incremental cost of making 52,500 units and buying 52,500 units. Should it continue to manufacture the component, or should it buy this component from the outside supplier
Answer:
Gelb Company should choose to Buy the Component since it is the cheaper option. This gives a cost advantage of $28,875.
Explanation:
For each Option, include costs which are unavoidable because those would change as a result of this decision, they are relevant costs items.
Total incremental cost : Making
Variable costs (52,500 x $4.05) $212,625
Fixed Costs (unavoidable) $75,500
Total $288,125
Total incremental cost : Buying
Purchase Price ( 52,500 x $3.50) $183,750
Fixed Costs (unavoidable) $75,500
Total $259,250
Conclusion :
Gelb Company should choose to Buy the Component since it is the cheaper option. This gives a cost advantage of $28,875 ($288,125 - $259,250).
In an electric motor, a commutator
a.
is made out of dozens of wire loops wrapped around a ferromagnetic core.
b.
repeatedly reverses the flow of current through the armature.
c.
is a magnet.
d.
is directly connected to the current source.
Answer:
ook
Explanation:
ook
Firms must provide the right incentives if they are to get _______ to focus on long-run value maximization. Conflicts exist between managers and stockholders and between stockholders (represented by managers) and . Managers' personal goals may compete with shareholder wealth maximization. However, managers can be motivated to act in their stockholders' best interests through (1) reasonable ______ packages, (2) firing of underperforming managers, and (3) the threat of hostile takeovers. If a firm's stock is undervalued, corporate raiders will see it as a bargain and will attempt to capture the firm in a hostile takeover. _______ generally receive fixed payments regardless of how well the firm does, while ______ earn higher returns when the firm's earnings are higher. Investments in ________ ventures, that have great payoffs to stockholders if successful but threaten bankruptcy if they fail, create conflicts. In addition, the use of additional ________ increases stockholder/debtholder conflicts. Consequently, bondholders attempt to protect themselves by including ________ in bond agreements that limit firms' use of additional ______ and constrain ________ actions.
Answer:
Managers; debtholders; compensation; bondholders; stockholders; risky; debt; convenants; debt; manager's.
Explanation:
An agency conflict can be defined as problems or issues that arises between management, a principal, or an owner, and other parties due to difference in interests.
This ultimately implies that, agency conflict arises when the incentives provided by the management, a principal, or an owner do not align well with those of an agent such as a manager, who is typically playing a fiduciary role.
A manager can be defined as an individual who is saddled with the responsibility of providing guidance, support, supervision, administrative control, as well as acting as a role model or example to the employees working in an organization by being morally upright.
Generally, managers are typically involved in taking up leadership roles and as such are expected to be build a strong relationship between their employees or subordinates by creating a fair ground for effective communication and sharing of resources and information. Also, they are required to engage their staff members (entire workforce) in the most efficient and effective manner.
how can gdp per capita and poverty rates indicate standards of living in each system?
Answer:
both measures that can be used to measure standards of living because they are both measures of how much money people have.
Explanation:
I hope this helped
Milton Industries expects free cash flows of $11 million each year. Milton's corporate tax rate is 22%, and its unlevered cost of capital is 14%. Milton also has outstanding debt of $21.85 million, and it expects to maintain this level of debt permanently. What is the value of Milton industries with leverage (in millions)
Answer:
the value of Milton industries with leverage is $83.38 million
Explanation:
The computation of the value of Milton industries with leverage is shown below:
= value of firm without leverage + Amount of debt x tax rate
= ($11 million ÷ 14%) + $21.85 million × 0.22
= $83.38 million
Hence, the value of Milton industries with leverage is $83.38 million
The same is to be considered and relevant
Meyer & Smith is a full-service technology company. They provide equipment, installation services as well as training. Customers can purchase any product or service separately or as a bundled package. Container Corporation purchased computer equipment, installation and training for a total cost of $120,000 on March 15, 2014. Estimated standalone fair values of the equipment, installation and training are $75,000, $50,000 and $25,000 respectively. Assuming that the training services will be performed in June 2014, the journal entry to record the transaction on March 15, 2014 will include a
Answer:
7
Explanation:
An insurance company processes 800 claims per year. The average processing time for a claim is 5 weeks. 45% of all claims received are car insurance claims, 40% of all claims received are motorcycle insurance claims, 10% are boat insurance claims, and the remaining are house insurance claims. Hint: These are throughput values. On average there are, 20 car, 9 motorcycles, 12 boats, and some house claims in process. Hint: These are inventory values. Assume 50 weeks per year.
1. What is the average number of claims that are in process?
A. 128 claims.
B. 64 claims.
C. 90 claims.
D. 80 claims.
E. 160 claims.
2. How many house insurance claims are in process?
A. 77 claims.
B. 21 claims.
C. 72 claims.
D. 39 claims.
E. 45 claims.
3. How long, on average, does it take to process a car insurance claim?
A. 7.5 weeks.
B. 4.5 weeks.
C. 3.75 weeks.
D. 6.67 weeks.
E. 2.78 weeks.
4. How long, on average, does it take to process a house insurance claim?
A. 15.63 weeks.
B. 48.75 weeks.
C. 17.5 weeks.
D. 36 weeks.
E. 11.25 weeks.
Answer:
1. D. 80 claims.
2. D. 39 claims
3. E. 2.78 weeks
4. B. 48.75 weeks
Explanation:
1. Calculation to determine the average number of claims that are in process
Using this formula
Average number of claims in process = Lead time in weeks*units per week
Let plug in the formula
Average number of claims in process = 5*(800/50)
Average number of claims in process= 80 claims
Therefore the average number of claims that are in process is 80 claims
2. Calculation to determine How many house insurance claims are in process
Average number of house insurance claims in process = 80-20-9-12
Average number of house insurance claims in process = 39 claims
Therefore the Average number of house insurance claims in process is 39 claims
3. Calculation to determine How long, on average, does it take to process a car insurance claim
First step is to calculate the Units per week
Units per week = (800/50)*45%
Units per week= 7.2
Now let calculate How long, does it take to process a car insurance claim
Time taken to process a car insurance claim = 20/7.2
Time taken to process a car insurance claim = 2.777777778
Time taken to process a car insurance claim = 2.78 weeks (Approximately)
Therefore How long, on average, it take to process a car insurance claim is 2.78 weeks
4. Calculation to determine How long, on average, does it take to process a house insurance claim
Using this formula
Time taken to process a house insurance claim = Average number of house insurance claims in process/Weekly house insurance claims
Let plug in the formula
Time taken to process a house insurance claim= 39/[(800/50)*5%]
Time taken to process a house insurance claim= 48.75 weeks
Therefore How long, on average, it take to process a house insurance claim is 48.75 weeks
Why is it a good idea to turn off Wi-Fi while using a mobile banking app?
Answer:
The fact that Wi-Fi broadcasts data to anybody in range means that your information could be at risk.
Explanation: 1 That's especially risky if you use Wi-Fi for online banking. Avoiding Wi-Fi altogether is not realistic. It's probably not even practical to save banking sessions for when you're at home or on a wired connection.
Presented below is information related to Splish Company at December 31, 2020, the end of its first year of operations.
Sales revenue $334,910
Cost of goods sold 149,030
Selling and administrative expenses 54,000
Gain on sale of plant assets 32,710
Unrealized gain on available-for-sale debt investments 9,080
Interest expense 6,360
Loss on discontinued operations 11,260
Dividends declared and paid 4,660
Compute the following:
(a) Income from operations -
(b) Net income -
(c) Comprehensive income
(d) Retained earnings balance at December 31, 2020 -
Answer:
a. $131,880
b. $167,310
c. $156,050
d. $151,390
Explanation:
(a) Income from operations
Income from Operations is Income resulting from Primary Trading Activities of the Company.
Income from Operations = Gross Profit + Operating Income - Operating Expenses
where,
Gross Profit = Sales - Cost of Goods Sold
= $334,910 - $149,030
= $185,880
thus,
Income from Operations = $185,880 - $54,000 = $131,880
(b) Net income
Income resulting from Primary and Secondary Trading Activities of the the Company.
Net income = Income from Operations + Non Operating Income - Non Operating Expenses
= $131,880 + $32,710 + $9,080 - $6,360
= $167,310
(c) Comprehensive income
Income from both Continuing and Non - Continuing Activities.
Comprehensive income = Net income + Non - Continuing Activities
= $167,310 - $11,260
= $156,050
(d) Retained earnings balance at December 31, 2020
The Income remaining after distributions to shareholders have been made.
Retained earnings = Comprehensive income - Dividends
= $156,050 - $4,660
= $151,390
hello everyone i hope everyone it doing great
free point
happy Ramadan kareem
Answer:
Hello There!!
Explanation:
Happy Ramadan
Answer:
thx
Explanation:
Mitchell products manufacturers faux boulders to be used in various landscaping applications. A special resin is used to make the boulders. The standard quantity of resin used for each boulder is 2 pounds. Mitchell Products uses a standard cost of $1.80 per pound for the resin. The company produced 11,000 boulders in June. In that month, 21,750 pounds of resin were purchased at a total cost of $43,500.
Calculate the direct material price variance.
Answer:
Direct material price variance= $4,350 unfavorable
Explanation:
To calculate the direct material price variance, we need to use the following formula:
Direct material price variance= (standard price - actual price)*actual quantity
Direct material price variance= (1.8 - 2)*21,750
Direct material price variance= $4,350 unfavorable
Actual price= 43,500 / 21,750= $2
You own shares of Somner Resources' preferred stock, which currently sells for per share and pays annual dividends of $ per share. If the market's required yield on similar shares is percent, should you sell your shares or buy more?
Answer:
You should buy more shares
Explanation:
The above-mentioned question is missing few components. I have added them to explain on how the question would be solved if all the variables were provided. Please note the additions in bold text below. The answer of which is given afterwards.
You own 300 shares of Somner Resources' preferred stock, which currently sells for $39 per share and pays annual dividends of $5.50 per share. If the market's required yield on similar shares 12% is percent, should you sell your shares or buy more?
Solution as mentioned below:
First of all we need to calculate value of the preferred stock by dividing the annual dividend per share from the market required rate.
Value of preferred stock = 5.50 / 12%
Value of preferred stock = $45.83
Now given the fact that the current price at which the stocks are sold is $39 which is less than the price at which they are actually valued which is $45.83. You should buy more of the shares as they are currently undervalued.
Assume that you are running for president of a local sports club, for which there is another contender. Although you have administrative experience in managing sports clubs, the other contender is a professional sportsperson. Most of the club members consist of retired sports personnel, commentators, and sports journalists, most of whom feel that the club lacks the latest equipment, proper restrooms, and secure locker facilities. Write a statement to be emailed to each member, clearly stating what you would do for the club once elected.
Answer:
Jeepers
Explanation:
Eat at State is considering buying a new food truck. It will cost $65,000, but is expected to generate $20,000 in sales over the next 4 years. At the end of the 4th year, the truck will be sold to Eat Like a Wolverine in Ann Arbor for $10,000 (after taxes). It will require $5,000 in additional Net Working capital that will not be recovered when the truck is sold. The Dean of Food Services will only authorize the purchase if it is cash positive by the end of the 4th year. Using the payback period method, should the truck be purchased, and why
Answer:
It is not advisable to buy the food truck, since over the 4 years of investment it will show a loss of $ 40,000.
Explanation:
Since Eat at State is considering buying a new food truck, and it will cost $ 65,000, but is expected to generate $ 20,000 in sales over the next 4 years, and at the end of the 4th year, the truck will be sold to Eat Like a Wolverine in Ann Arbor for $ 10,000 (after taxes), and it will require $ 5,000 in additional Net Working capital that will not be recovered when the truck is sold, and the Dean of Food Services will only authorize the purchase if it is cash positive by the end of the 4th year, to determine, using the payback period method if the truck should be purchased and why, the following calculation must be performed:
-65,000 + 20,000 + 10,000 - 5,000 = X
-70,000 + 30,000 = X
-40,000 = X
Therefore, it is not advisable to buy the food truck, since over the 4 years of investment it will show a loss of $ 40,000.
Pension funds pay lifetime annuities to recipients. If a firm will remain in business indefinitely, the pension obligation will resemble a perpetuity. Suppose, therefore, that you are managing a pension fund with obligations to make perpetual payments of $2 million per year to beneficiaries. The yield to maturity on all bonds is 16%. a. If the duration of 5-year maturity bonds with coupon rates of 12% (paid annually) is four years and the duration of 20-year maturity bonds with coupon rates of 6% (paid annually) is 11 years, how much of each of these coupon bonds (in market value) will you want to hold to both fully fund and immunize your obligation
Solution :
The PV "perpetual" obligation of the firm = [tex]$\frac{\$ 2 \text{ million}}{0.16}$[/tex]
= $ 12.5 million
Also based on duration of the perpetuity, duration of this obligation = [tex]$\frac{1.16}{0.16}$[/tex]
= 7.25 years
Let [tex]$w$[/tex] be the [tex]$\text{weight}$[/tex] on the [tex]$5$[/tex] year maturity bond, which has a duration of [tex]$4$[/tex]years. Then :
[tex]$w \times 4 +(1-w) \times 11 = 7.25$[/tex]
[tex]$w=0.5357$[/tex]
Therefore,
[tex]$0.5357 \times \$ 12.5 = \$ 6.7$[/tex] million in the [tex]$5$[/tex] year bond
[tex]$0.4643 \times \$12.5=\$5.8$[/tex] million in the [tex]$2$[/tex] year bond.
Therefore, the total invested amounts to $ [tex]$(6.7+5.8)$[/tex] million = [tex]$\$12.5$[/tex] million, which fully matches the funding needs.
Angela, Inc., holds a 90 percent interest in Corby Company. During 2020, Corby sold inventory costing $114,300 to Angela for $127,000. Of this inventory, $43,600 worth was not sold to outsiders until 2021. During 2021, Corby sold inventory costing $153,600 to Angela for $192,000. A total of $50,400 of this inventory was not sold to outsiders until 2022. In 2021, Angela reported separate net income of $168,000 while Corby's net income was $102,000 after excess amortizations. What is the noncontrolling interest in the 2021 income of the subsidiary
Answer: $9628
Explanation:
First, we need to calculate the gross profit which will be:
= $127,000 - $114,300
= $12700
Then, gross profit rate will be:
= Gross profit / Sales × 100
= ($12700 / $127,000) × 100
= 10%
Unrealized profit on $43,600 will be:
= 10% × $43600
= 0.1 × $43600
= $4360
The unrealized profit for 2021 will be calculated as:
= $192,000 - $153,600
= $38400
Then, gross profit rate will be:
= Gross profit / Sales × 100
= ($38400 / $192,000) × 100
= 20%
Unrealized profit on $50,400 will be:
= 20% × $50,400
= 0.2 × $50,400
= $10080
The noncontrolling interest in the 2021 income of the subsidiary will then be:
Income of Corby company = $102000
Add: Deferal of unrealized gross profit = $4360
Less : Unrealized profit on current year = $10080
Adjusted income = $96280
Non controlling interest at 10% will then be:
= 10% × $96280
= 0.1 × $96280
= $9628
All of the following are weaknesses of the payback period:_________ (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer. Any boxes left with a question mark will be automatically graded as incorrect.)
a. it uses cash flows, not income.
b. it is easy to use.
c. it ignores all cash flows after the payback period
d. it ignores the time value of money.
Answer:
c. it ignores all cash flows after the payback period
d. it ignores the time value of money.
Explanation:
Payback period as far as capital budgeting is concerned can be regarded as time that is required for recouping of funds that is been expended during setting up of an investment, or the funds required to get to break-even point. It should be noted that weaknesses of the payback period are;
✓. it ignores all cash flows after the payback period
✓ it ignores the time value of money.
Select the correct answer.
How does licensing for food handling work?
O A. There is one national certification program.
B.
There are several national certification programs.
Ос.
There is one regional certification program.
D. There are several regional certification programs.
Answer:
The answer is D
Explanation:
There are several regional certification programs does license for food handling work. Thus, option (d) is correct.
What is food?The term “food” refers to an edible and consumable material that provides the body with nutrition and vitamins to maintain itself. Plants, humans, animals, and birds all typically eat food. fruits, vegetables, legumes, dairy, and other nutrient-dense foods. The body need the food in order to function, thus it was consumed.
Food Safety and Hygiene was the handling the work was the provided in the many regional certification programs. It was the main agenda to provided the information regarding the cleaning procedures and food, safe cooking temperatures, proper hygiene, and the preparation methods.
As a result, the significance of the food is the aforementioned. Therefore, option (d) is correct.
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A global positioning system (GPS) receiver is purchased for $3,000. The IRS informs your company that the useful (class) life of the system is seven years. The expected market (salvage) value is $200 at the end of year seven. a. Use the straight-line method to calculate depreciation in year three.
Answer: $400
Explanation:
To solve the question, we should note that the annual depreciation under the straight line depreciation method is given as:
= ( Cost - Salavage ) / Estimated Useful Life
= ($3,000 - $200 ) / 7
= $2800 / 7
= $400.
Therefore, the depreciation in year 3 will be $400
Materials Variances Assume that Pearle Vision uses standard costs to control the materials in its made-to-order sunglasses. The standards call for 2 ounces of material for each pair of lenses. The standard cost per ounce of material is $15.75. During July, the Santa Clara location produced 5,200 pairs of sunglasses and used 9,600 ounces of materials. The cost of the materials during July was $16.50 per ounce, and there were no beginning or ending inventories. Required a. Determine the flexible budget materials cost for the completion of the 5,200 pairs of glasses. $Answer 163,800 b. Determine the actual materials cost incurred for the completion of the 5,200 pairs of glasses and compute the total materials variance. $Answer 158,400 actual materials cost $Answer 12,600 Answer total materials variance c. How much of the total variance was related to the price paid to purchase the materials? $Answer 7,200 Answer d. How much of the difference between the answers to requirements (a) and (b) was related to the quantity of materials used? (Hint: Compute materials quantity variance.) $Answer 0 Answer
Answer:
A. $163,800
B. $158,400
$5,400 F
C.$7,200 U
D.$12,600 F
Explanation:
A. Calculation to Determine the flexible budget materials cost for the completion of the 5,200 pairs of glasses.
Flexible budget materials cost for the completion of the 5,200 pairs
= 5200 pairs * 2 ounces * $15.75
= $163,800
b. Calculation to determine the actual materials cost incurred for the completion of the 5,200 pairs of glasses
Actual materials cost incurred for the completion of the 5,200 pairs.
= Actual material used * Actual rate
= 9,600 ounces * $16.50
= $158,400
Computation for the total materials variance
Total Material Variance = Flexible budget material cost for actual production - Actual material cost
= $163,800-$158,400
= $5,400 F
c). Calculation to determine How much of the total variance was related to the price paid to purchase the materials
Total variance was related to the price paid to purchase the materials.
Material price variance = (Standard price - Actual price) * Actual quantity
= ($15.75 - $16.50) * 9600 ounces
= $7,200 U
d) Calculation to determine How much of the difference between the answers to requirements (a) and (b) was related to the quantity of materials used
Material quantity variance = (Standard qty for actual production - Actual quantity ) * Standard rate
= (5200 * 2 ounces - 9600 ounces) * $15.75
= (10400 ounces - 9600 ounces) * $15.75
= $12,600 F
The balance in retained earnings for Ceylan Company at December 31, 2020 was $1,080,000 and at December 31, 2021 was $876,000. Net income for 2021 was $750,000. A stock dividend was declared and distributed which increased common stock $375,000 and paid-in capital $165,000. A cash dividend was declared and paid. The amount of the cash dividend was (Hint, draw a T Account.)
Answer:
See
Explanation:
Given the above information, the amount of cash dividend i s
Beginning retained earnings at December 31, 2020
$1,080,000
Add; Net income for 2021
$750,000
Less;
Ending retained earnings at December 31, 2021
$876,000
Cash dividend
$954,000
Therefore, the amount of cash dividend was $954,000
Madzinga's Draperies manufactures curtains. A certain window requires the following:
Direct materials standard 10 square yards at $5 per yard
Direct manufacturing labor standard 5 hours at $10
During the second quarter, the company made 1.500 curtains and used 14.000 square yards of fabric costing $68, 600. Direct labor totaled 7, 600 hours for $79, 800.
Required
a. Compute the direct materials price and efficiency variances for the quarter.
b. Compute the direct manufacturing labor price and efficiency variances for the quarter
Answer:
Results are below.
Explanation:
To calculate the direct material price and quantity variance, we need to use the following formulas:
Direct material price variance= (standard price - actual price)*actual quantity
Direct material price variance= (5 - 4.9)*14,000
Direct material price variance= $1,400 favorable
Actual price= 68,600/14,000= $4.9
Direct material quantity variance= (standard quantity - actual quantity)*standard price
Direct material quantity variance= (1,500*10 - 14,000)*5
Direct material quantity variance= $5,000 favorable
To calculate the direct labor efficiency and rate variance, we need to use the following formulas:
Direct labor time (efficiency) variance= (Standard Quantity - Actual Quantity)*standard rate
Direct labor time (efficiency) variance= (5*1,500 - 7,600)*10
Direct labor time (efficiency) variance= $1,000 unfavorable
Direct labor rate variance= (Standard Rate - Actual Rate)*Actual Quantity
Direct labor rate variance= (10 - 10.5)*7,600
Direct labor rate variance= $3,800 unfavorable
Actual rate= 79,800 / 7,600= $10.5
Incremental costs - Initial and terminal cash flow
Consider the case of Marston Manufacturing
Acme Manufacturing is considering a project that requires an investment in new equipment of $3,200,000, with an additional $160,000 in shipping and installation costs. Acme estimates that its accounts receivable and inventories need to increase by $640,000 to support the new project, some of which is financed by a $256,000 increase in spontaneous liabilities (accounts payable and accruals).
The total cost of Marston's new equipment is___the and consists of the price of the new equipment plus the_____.
In contrast, Marston's initial net investment outlay is____.
Suppose Marston's new equipment is expected to sell for $200,000 at the end of its four-year useful life, and at the same time, the firm expects to recover all of its net operating working capital investment. The company chose to use straight-line depreciation, and the new equipment was fully depreciated by the end of its useful life. If the firm's tax rate is 40%, what is the project's total ter)tination cash flow?
a. $200,000.
b. $464,000.
c. $504,000.
d. $120,000.
Answer:
c. $504,000
Explanation:
Total cost of new equipment = Price of equipment + Shipping & Installation costs = $3,200,000 + $160,000 = $3,360,000
Increase in working capital = Increase in inventories & account receivables - Increase in accounts payable = $640,000 - $256,000 = $384,000
Total Initial net investment outlay = $3,744,000 ($3,360,000+$384,000)
Project terminal cash-flow = Sale value of equipment (after tax) + Recovery of working capital = $200,000*(1-0.40) + $384,000 = $120,000 + $384,000 = $504,000
Farmer Brown grows Number 1 red corn and would like to hedge the value of the coming harvest. However, the futures contract is traded on the Number 2 yellow grade of corn. Suppose that yellow corn typically sells for 90% of the price of red corn. If he grows 180,000 bushels, and each futures contract calls for delivery of 5,000 bushels, how many contracts should Farmer Brown buy or sell to hedge his position
Answer:
40 contracts
Explanation:
Calculation to determine how many contracts should Farmer Brown buy or sell to hedge his position
First step is to calculate how much The farmer must sell forward
Farmer must sell forward=180,000∗(1/0.90)
Farmer must sell forward= 200,000bushels of yellow corn.
Now let calculate the requires selling
Requires selling=200,000/ 5,000 bushels
Requires selling =40 contracts.
Therefore how many contracts should Farmer Brown buy or sell to hedge his position is 40 contracts.
At December 31, 2020, Carter Company had 450,000 shares of common stock issued and outstanding, 350,000 of which had been issued and outstanding throughout the year and 100,000 of which were issued on September 1, 2020. Net income for the year ended December 31, 2020, was $1,160,000. What should be Twin Rivers' 2020 earnings per common share, rounded to the nearest penny
Answer:
$3.03
Explanation:
Calculation to determine What should be Twin Rivers' 2020 earnings per common share,
Using this formula
Earnings per common share=
Net Income for 2020/Weighted Average Shares Outstanding
Let plug in the formula
Earnings per common share=$1,160,000/ [(350,000 x 8/12) + (450,000 × 4/12)]
Earnings per common share=$1,160,000/(233,333+150,000)
Earnings per common share=$1,160,000/383,333
Earnings per common share= $3.03
Therefore What should be Twin Rivers' 2020 earnings per common share is $3.03
Alomar Company manufactures four products from a joint production process: barlon, selene, plicene, and corsol. The joint costs for one batch are as follows:
Direct materials $64,500
Direct labor 35,000
Overhead 26,500
At the split-off point, a batch yields 1,000 barlon, 2,200 selene, 2,100 plicene, and 4,000 corsol. All products are sold at the split-off point: barlon sells for $17 per unit, selene sells for $24 per unit, plicene sells for $26 per unit, and corsol sells for $38 per unit.
Required:
Allocate the joint costs using the sales-value-at-split-off method. If required, round allocation rates to four decimal places and round the final allocations to the nearest dollar.
Solution :
Total Joint Cost
Material = $ 64,500
Labor = $ 35,000
Overhead = $ 26,500
Total joint cost = $ 126,000
Products Units SP at Split Sales % Sales Joint cost Allocated Joint Cost
Barlon 1000 17 17,000 7.88% 126,000 10001.99
Selene 2200 24 52800 23.03% 126,000 29249.5
Plicene 2100 26 54600 25.02% 126,000 31771.01
Corsol 4000 38 152000 44.08% 126,000 55977.5
302200 100.00% 126000 127000
Stellan Manufacturing is considering the following two investment proposals:
Proposal X
Proposal Y
Investment
$730,000
$504,000
Useful life
5 years
4 years
Estimated annual net cash inflows received at the end of each year
$156,000
$100,000
Residual value
$50,000
$0
Depreciation method
Straightminus
line
Straightminus
line
Annual discount rate
10%
9%
Compute the present value of the future cash inflows from Proposal Y.
Present value of an ordinary annuity of $1:
8%
9%
10%
1
0.926
0.917
0.909
2
1.783
1.759
1.736
3
2.577
2.531
2.487
4
3.312
3.240
3.170
5
3.993
3.809
3.791
6
4.623
4.486
4.355
A.
$252,000
B.
$292,320
C.
$268,884
D.
$324,000
Answer:When the federal government spends more money than it receives in taxes in a ... spending over time in nominal dollars is misleading because it does not take ... defense spending as a share of GDP has generally declined since the 1960s, ... Healthcare expenditures include both payments for senior citizens (Medicare), ...
Explanation:
One way to raise money to operate a corporation is to sell portions of ownership to
the public
True or False
Answer:
true
Explanation:
public limited companies can sell its shares to the the public ,a share represents part ownership of a companies hence the statement is true
Englehard purchases a slurry-based separator for the mining of the clay that costs $650,000 and has an estimated useful life of 10 years, a MACRS-GDS property class of 7 years, and an estimated salvage value of $65,000 after 10 years. It was financed using a $180,000 down payment and a loan of $470,000 over a period of 5 years with interest at 10%. Loan payments are made in equal annual amounts (principal plus interest) over the 5 years. a. What is the amount of the MACRS-GDS depreciation taken in the 3rd year
Answer:
The amount of the MACRS-GDS depreciation taken in the 3rd year is $113,750.
Explanation:
From the MACRS-GDS table, the third year depreciation rate for a MACRS-GDS property class of 7 years is 0.175. Therefore, the amount of the MACRS-GDS depreciation taken in the 3rd year can be calculated as follows:
Third year depreciation = Cost of the separator * Third year depreciation rate = $650,000 * 0.175 = $113,750
Therefore, the amount of the MACRS-GDS depreciation taken in the 3rd year is $113,750.