Answer:
the sun rose at 6.04 this morning
Explanation:
hope it helps
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Taveras Corporation is currently operating at 50% of its available manufacturing capacity. It uses a job-order costing system with a plantwide, predetermined overhead rate based on machine-hours. At the beginning of the year, the company made the following estimates:
Machine-hours required to support estimated production 240,000
Fixed manufacturing overhead cost 4,320,000
Variable manufacturing overhead cost per machine-hour 2.00
Required:
1. Compute the plantwide predetermined overhead rate.
2. During the year, Job P90 was started, completed, and sold to the customer for $4,000. The following information was available with respect to this job:
Direct materials $1,840
Direct labor cost $1,320
Machine-hours used 87
Determine the total cost of Job P90
Answer:
Results are below.
Explanation:
To calculate the predetermined manufacturing overhead rate we need to use the following formula:
Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Predetermined manufacturing overhead rate= (4,320,000/240,000) + 2
Predetermined manufacturing overhead rate= $12.29 per machine hour
Job P90:
Direct materials $1,840
Direct labor cost $1,320
Machine-hours used 87
Total cost= 1,840 + 1,320 + (12.29*87)
Total cost= $4,229.23
Using the information provided, analyze the affects of Lawry Lawn Service's transactions on the accounting equation.
May 1 Received $3,400 and issued common stock
May 3 Purchased a mower on account, $1,600
May 5 Performed lawn services for client on account $1,000
May 17 Paid $100 cash for gas used in mower.
May 28 Paid cash dividends of $700
Analyze the events chronologically, one transaction at a time. Beginning with the transaction on May 3rd, calculate the balance in each account after analyzing the effect of the transaction on the accounting equation.
Answer:
Common Stock $3,400 (credit)
Mower $1,600 (debit)
Revenue Service $1,000 (credit)
Cash $2,600 (debit)
Gas Expense $100 (debit)
Dividends $0
Explanation:
See below the posting i have done to the ledger accounts.
Mower T - Account
Debit :
Accounts Payable $1,600
Credit :
Balance c/d $1,600
Revenue Service T - Account
Debit :
Balance c/d $1,000
Credit :
Account Receivable $1,000
Cash T - Account
Debit :
Common Stock $3,400
Credit :
Gas Expense $100
Dividends $700
Balance c/d $2,600
Gas Expense T - Account
Debit :
Cash $100
Credit :
Balance c/d $100
Dividends - T Account
Debit :
Shareholders for dividends $700
Credit :
Cash $700
Proactiv and George Foreman Grill became successful after appearing in television commercials that asked customers to call a toll-free number or go to a website to order the products. This is an example of _____. Not Telemarketing
The given scenario of making use of television commercials to make sales is known as Infomercials
What is Advertising?This refers to the practice of creating awareness for a group of products so that people can buy the goods.
Hence, we can note that because Proactiv and George Foreman Grill became successful after appearing in television commercials, and persuading people to buy their products, this is an example of infomercials.
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You have a very efficient and reliable team member on your team, but they are infamous for treating symptoms rather than root causes. What is the likely outcome of using their quick assistance
Because the team member are infamous for treating symptoms rather than root causes, then, the likely outcome of their quick assistance will be that any fix provided will be short-lived.
What is treatment of symptoms rather than root causes?Basically, a symptom means the an indication of the existence of something while the root cause means the core issue or reason behind the symptoms.
The treatment of the symptoms rather than root cause means that the symptom will be reoccur after initial treatment because the root cause have not been treated.
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Can someone answer this pls?:)
Answer:
Explanation:
Okay assuming each textbox is A,B,C,D,E,F from left to right:
A - 6
B - 5
C - 2
D - 3
E - 4
F - 1
Two computers each produced 43,000 public utilities bills in a day. One computer printed bills at the rate of 8,600 an hour and the other at the rate of 7,800 an hour. When the first computer finished its run, how many bills did the other computer still have to print?
Based on the rate at which the computers are printing bills, the number of bills that the second computer was still to print was 4,000 bills.
How long did the first computer take to finish?= Number of bills / Bills per hour
= 43,000 / 8,600
= 5 hours
How many bills was the second computer left with?This can be found by the formula:
= Number of bills to print - Bills printed in 5 hours
= Number of bills to print - ( Bills printed per hour x Number of hours)
Solving gives:
= 43,000 - (7,800 x 5)
= 4,000 bills
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Countries benefit from trade by importing goods in which their opportunity costs are relatively _____ and exporting goods in which their opportunity costs are relatively _____. low; high low; low high; low high; high
A country will benefit from trade when they import goods they have a high opportunity cost in while exporting those they have a low opportunity cost in.
How can a country benefit from trade?The country should produce and export the goods that will be cheaper when it comes to opportunity costs as this would allow them to produce more of those goods.
They should then import the goods that will be too expensive to produce in terms of opportunity costs.
In conclusion, option C is correct.
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Boursaw Corporation has provided the following data concerning last month’s operations. Purchases of raw materials $33,000 Indirect materials included in manufacturing overhead $ 4,000 Direct labor cost $58,000 Manufacturing overhead applied to Work in Process $78,000 Underapplied overhead $ 5,000 Beginning Ending Raw materials inventory $10,000 $15,000 Work in process inventory $56,000 $72,000 Finished goods inventory $41,000 $49,000 Any underapplied or overapplied manufacturing overhead is closed out to cost of goods sold. How much is the unadjusted cost of goods sold on the Schedule of Cost of Goods Sold?
Answer:
COGS= $136,000
Explanation:
First, we need to calculate the cost of goods manufactured:
cost of goods manufactured= beginning WIP + direct materials + direct labor + allocated manufacturing overhead - Ending WIP
We deduct the indirect material from the direct material purchase, so we don't sum it twice.
Because it is the unadjusted cost of goods sold, we take into account the allocated overhead.
cost of goods manufactured= 56,000 + (10,000 + 33,000 - 4,000 - 15,000) + 58,000 + 78,000 - 72,000
cost of goods manufactured= $144,000
To calculate the unadjusted cost of goods sold, we need to use the following formula:
COGS= beginning finished inventory + cost of goods manufactured - ending finished inventory
COGS= 41,000 + 144,000 - 49,000
COGS= $136,000
A review of the ledger of Marin Inc. at December 31 produces the following data for the preparation of annual adjusting entries:
1. Salaries and Wages Payable, $0. There are 8 salaried employees. 5 employees receive a salary of $1,150 each per week, and 3 employees earn $690 each per week. Employees do not work weekends. All employees worked two days after the last pay period and before December 31.
2. Unearned Rent Revenue, $349,860. The company began leasing condos in its new building on November 1. Each tenant has to make a $5,340 security deposit that is not refundable until occupancy is ended. At December 31, the company had the following rental contracts that were paid in full for the entire term of the lease:
Date Term (in months) Monthly Rent Number of Leases
Nov. 1 6 $3,940 6
Dec. 1 6 $10,370 4
Prepaid Advertising, $16,560. This balance consists of payments on two advertising contracts. The contracts provide for monthly advertising in two trade magazines. The terms of the contracts are as follows:
Contract Date Amount Number of magazines Issues
A650 May 1 $6,960 12
B974 Oct. 1 9,600 24
The first advertisement runs in the month in which the contract is signed.
4. Notes Payable, $78,480. This balance consists of a one year, 8%, note that is dated June 1.
Required:
Marin is preparing for a meeting with potential investors. What is the net effect of the adjusting entries on net income?
Answer:
the effect will decrease net income by 9588.73
Explanation:
(1) we have salaries expense for the accrued amount
3 employees x 690 x 2/5 +
5 employees x 1150 x 2/5 = 3128
(2)
earned rent revenue
Nov 1st 3,940 for 6 month 2 month accrued = 1,313.33
Dec 1st 10,370 for 6 month 1 month accrued = 1,728.33
total earnings 3,041.67
(3)
6,960 for a whole year accrued for the year
between May 1st to Dec 31th = 4,640
9,600 for 24 months
between Oc 1st and Dec 31th portion accrued 3/24 = 1,200
total advertizing expense 5,840
(4)
Note Payables interest expense accrued
principal x rate x time
(portion of a year between june 1st and dece4mber 31th)
78,480 x 0.08 x 7/12 = 3.662,4
Net effect:
rent revenue 3,041.67
salaries expense (3128)
advertizing expense (5,840)
interest expense (3,662.4)
total impact (9588.73)
Taxes go to pay for the following as what percentage of the GDP: a) Social Security 2.7%, National Defense 11.9%, and Medicare 4.9% b) Social Security 30.1%, National Defense 10.5%, and Medicare 4.2% c) Social Security 4.9%, National Defense 3.1%, and Medicare 2.9% d) Social Security 6.6%, National Defense 5.7%, and Medicare 12.1%
Answer: c) Social Security 4.9%, National Defense 3.1%, and Medicare 2.9%
Taxes go to pay for GDP in the following way:
Social Security 4.9%, National Defense 3.1%, and Medicare 2.9%
What are taxes?These are the amounts that businesses and individuals that are paid workers pay to the government on a monthly business.
Taxes are a way that the country is able to fund a lot of its social security programs.
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Discuss any five reason why corporate and business organization are now taking a keen interest in environment issue.
Our shared inheritance includes the air, water, woods, and land.
Companies have been dumping garbage into my air and water, as well as causing damage to my portion of the woods and land, without paying me or others.
We're enraged and ready to throw in the towel. The quality of my remaining life, as well as the lives of my grandchildren, depends on our addressing this deplorable lack of responsible resource stewardship. Sustainable methods are also helpful for business. Short-sighted business tactics that lead to a company's demise cannot be helpful for the bottom line.
Some people are concerned about environmental concerns and will patronize companies that take action to address them. Some business executives see that we are on the verge of disaster and wish to take steps to ensure their companies' long-term viability.
Those who uphold their power's commitments are deserving of it. Climate change and biodiversity loss are major issues that must be addressed. Those that continue to poison our commonwealth can expect their pollution profiteering to be less understood in the future. Corporations and companies exist primarily to make money, but they also function under the assumption that they will do more good than harm in the long run. If it is discovered that they are more bad than good, they will lose the trust of the communities in which they operate. They will be history if enough investors, voters, workers, and citizens decide to hold them accountable. I hope that more businesses and corporations take their environmental duties seriously, and I wish those that already do so the best of luck in expanding their market share.
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The following list of five reasons explains why corporate and business organizations are now paying close attention to environmental challenges.
Why do corporate take a keen interest in environmental issues?Being environmentally conscious has advantages for both the environment and the corporate company.
Customers who value environmentally friendly practises will be more satisfied after using products from a company that is demonstrating that it does no harm to the environment or minimises harm to the environment.
This will also help the company build a positive reputation and make it more appealing to employees and business partners who value environmentally sustainable practises.
Developing creative methods that have a positive impact on the environment, can improve sales, and can give a company a competitive edge over rivals that don't practice environmental responsibility.
Attracting new clients who are looking for environmentally friendly goods and services.
Therefore, reduced operating expenses, more innovation, enhanced brand recognition, and an increase in new customers that appreciate sustainability all contribute to sustainable enterprises' increased revenue.
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For the following scenario, decide whether you agree or disagree and explain your answer. If the elasticity of demand for cocaine is 0.20 and the Drug Enforcement Administration succeeds in reducing supply substantially, causing the street price of the drug to rise by 50%, buyers will spend less on cocaine. A. Disagree: When price increases and demand is inelastic, total revenue will rise. B. Agree: When price increases and demand is inelastic, total revenue will rise. C. Disagree: When price increases and demand is elastic, total revenue will rise. D. Agree: When price increases and demand is elastic, total revenue will fall.
Answer:
A. Disagree: When price increases and demand is inelastic, total revenue will rise.
Explanation:
A price elasticity of demand of 0.20 is a very low price elasticity, this means that cocaine users do not respond to price changes with equivalent changes in demand. In other words, if the price of cocaine increases, most of them will still buy the product, because demand will not fall as much as the price rises according to the price elasticity of demand.
For this reason, if the price of cocaine increases, the total amount spent on cocaine will increase.
As you progress from projects to continuous processes, all of the following statements are true, EXCEPT: Group of answer choices Supplier ties are more formal and of longer duration Degree of worker control over the pace of the process increases Finished goods inventories are larger Long-term sales forecasts become increasingly important for planning purposes
When we progress from projects to continuous processes, it is not true that Degree of worker control over the pace of the process increases.
What happens when we move to continuous processes?Because the processes of production in a company are now continuous, it means that workers will be needed to work repeatedly overtime.
This means that workers will have less control over the times they have to work and the pace of production.
In conclusion, option B is correct.
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North Company designs and manufactures machines that facilitate DNA sequencing. Depending on the intended purpose of each machine and its functions, each machine is likely to be unique. The job costing system in its Norfolk plant has five activity cost pools, in addition to direct materials and direct labor. Job TPY—2306 requires 1,000 printed-circuit boards. The cost per board that passes the final inspection is $240. On average, only 50% of the completed units pass the final inspection. The prime costs per completed board include $26 for direct materials and $8 for direct labor
Required:
Information pertaining to manufacturing overhead for printed-circuit boards follows: Fill in the missing amount.
Activity Cost Driver Activity Driver Rate Activity Consumption per Board Factory Overhead per Board
Axial insertion Number of axial insertions $0.27 10.0
Hardware insertion Number of hardware insertions 4.00 110.0
Hand load Boothroyd time 8.00 48.24
Masking Number of points masked 0.30 170.00
Final test Test time 10.00 10.00
Answer:
1. Axial insertion
Factory overhead per board 2.70
2. Hand load
Activity consumption per board 27.50
3. Hand load
Activity driver rate 6.03
4. Masking
Factory overhead per board 51
5. Final test Test time 1
Explanation:
Calculation to Determine the missing amount
Activity Cost Driver Activity driver rate Activity consumption per board Factory overhead per board
1. Axial Insertion Number of axial insertions 0.27 10 10*.27 = 2.70
2. Hardware Insertion Number of hardware
insertions 4.00 (110/4 = 27.50) 110
3. Hand load Boothroyd time (48.24/8 = 6.03) 8 48.24
4. Masking Number of points masked 0.30 170 (170*.30 = 51)
5. Final test Test time (10/10=1) 10 10
What is the definition of minimum wage?
Answer:
Minimum wage i sthe lowest amoun that an employer can pay you per hour and they can not go lower than this number
Explanation:
Brainliest please
the lowest hourly pay that workers can receive
The inflation rate over the past year was 4.2 percent. If an investment had a real return of 9.4 percent, what was the nominal return on the investment?
The collection and summarization of the demographic characteristics of the employees of a particular firm is an example of
A descriptive statistics is done when a particular firm collects and summarizes the demographic characteristics of the employees.
What is a descriptive statistics?A descriptive statistics refers to a statistic that quantitatively summarizes and describes the features of a population from a collection of information.
In conclusion, the descriptive statistics basically summarize the characteristics of a data set for record purpose.
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Which three things does money help people do in an economy? (Pick three)
-Exchange commodities
-measure the value of commodities
-avoid inflation
-store value
-hide the price of a commodity
-increase inflation
-remove value
Answer:
Exchange commodities
store value
measure the value of commodities
Kyle is a college student who works during the summer to pay for tuition. Last summer he worked at a fast-food restaurant and earned $2,500. This summer he is working as a painter and will earn $4,000. To do the painting job, Kyle had to spend $200 on supplies. What is Kyle's accounting profit
Based on the amount Kyle earned and his costs, Kyle's accounting profit is $3,800.
What is Kyle's Accounting profit?This can be found by the formula:
= Amount he is paid as painter - Cost of painting supplies
Solving gives:
= 4,000 - 200
= $3,800
In conclusion, his accounting profit is $3,800.
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Consider the market for cars. Which determinant of supply is affected by each of the following events? a. A steel tariff increases the price of steel. Number of sellers Prices of inputs Prices of related goods Technology Expectations b. Improvements in robotics increase efficiency and reduce costs. Prices of related goods Technology Prices of inputs Number of sellers Expectations c. Factories close because of an economic downturn. Technology Prices of related goods Number of sellers Expectations Prices of inputs d. The government announces a plan to offer tax rebates for the purchase of commuter rail tickets. Number of sellers Prices of related goods Prices of inputs Expectations Technology e. The price of trucks falls, so factories produce more cars. Technology Number of sellers Prices of inputs Expectations Prices of related goods f. The government announces that it will dramatically rewrite efficiency standards, making it much harder for automakers to produce their cars. Prices of inputs Prices of related goods Expectations Technology Number of sellers
Answer & Explanation:
1. A steel tariff increases the price of steel : Increase in of 'Price of inputs' - decreases (leftward shifts) supply curve
2. Improvement in robotics increase efficiency & reduces costs : Upgradation of 'technology'- increases (rightward shifts) supply curve
3. Factories close because of am economic downturn : 'Number of sellers' reduce - decreases (leftward shifts) supply curve.
4. The price of trucks falls, so factories produce more cars : Decrease in 'price of related goods' - increases (rightward shifts) supply curve.
5. The government announces a plan to offer tax rebates for the purchase of commuter rail tickets : 'Expectations' regarding rise in relative price of cars - decreases (leftward shifts) supply curve.
6. The government announces that it will dramatically rewrite efficiency standards, making it much harder for automakers to produce their cars : 'Goverment policy' stringency - decreases (leftwards shifts) supply curve.
Matthews Delivery Service, Inc., completed the following transactions during its first month of operations for January 2012:
a. Matthews Delivery Service, Inc., began operations by receiving $6,000 cash and a truck valued at $11,000. The business issued common stock to aquire these assets.
b. Paid $300 cash for supplies.
c. Prepaid insurance, $700.
d. Performed delivery services for a customer and received $800 cash.
e. Completed a large delivery job, billed the customer $1,500, and received apromise to collect the $1,500 within one week.
f. Paid employee salary, $700.
g. Received $12,000 cash for performing delivery services.
h. Collected $600 in advance for delivery service to be performed later.
i. Collected $1,500 cash from a customer on account.
j. Purchased fuel for the truck, paying $200 with a company credit card. (CreditAccounts payable)
k. Performed delivery services on account, $900.l.Paid office rent, $600. This rent is not paid in advance.
m. Paid $200 on account.
n. Paid cash dividends of $2,100.
Required:
a. Record each transaction in the journal.
b. Post the transactions that you recorded in Requirement 1 in the T-accounts.
c. Write the trial balance for the month ended January 31, 2012.
Answer:
a. Matthews Delivery Service, Inc., began operations by receiving $6,000 cash and a truck valued at $11,000. The business issued common stock to acquire these assets.
Dr Cash 6,000
Dr Vehicles 11,000
Cr Common stock 17,000
b. Paid $300 cash for supplies.
Dr Supplies 300
Cr Cash 300
c. Prepaid insurance, $700.
Dr Prepaid insurance 700
Cr Cash 700
d. Performed delivery services for a customer and received $800 cash.
Dr Cash 800
Cr Service revenue 800
e. Completed a large delivery job, billed the customer $1,500, and received a promise to collect the $1,500 within one week.
Dr Accounts receivable 1,500
Cr Service revenue 1,500
f. Paid employee salary, $700.
Dr Wages expense 700
Cr Cash 700
g. Received $12,000 cash for performing delivery services.
Dr Cash 12,000
Cr Service revenue 12,000
h. Collected $600 in advance for delivery service to be performed later.
Dr Cash 600
Cr Unearned revenue 600
i. Collected $1,500 cash from a customer on account.
Dr Cash 1,500
Cr Accounts receivable 1,500
j. Purchased fuel for the truck, paying $200 with a company credit card. (CreditAccounts payable)
Dr Fuel expense 200
Cr Accounts payable 200
k. Performed delivery services on account, $900.
Dr Accounts receivable 900
Cr Service revenue 900
l.Paid office rent, $600. This rent is not paid in advance.
Dr Rent expense 600
Cr Cash 600
m. Paid $200 on account.
Dr Accounts payable 200
Cr Cash 200
n. Paid cash dividends of $2,100.
Dr Dividends 2,100
Cr Cash 2,100
Cash
Debit Credit
6,000
300
700
800
700
12,000
600
1,500
600
200
2,100
16,300
Vehicles
Debit Credit
11,000
Common stock
Debit Credit
17,000
Supplies
Debit Credit
300
Prepaid insurance
Debit Credit
700
Service revenue
Debit Credit
800
1,500
12,000
900
15,200
Accounts receivable
Debit Credit
1,500
1,500
900
900
Wages expense
Debit Credit
700
Unearned revenue
Debit Credit
600
Accounts payable
Debit Credit
200
200
0 0
Fuel expense
Debit Credit
200
Rent expense
Debit Credit
600
Dividends
Debit Credit
2,100
Trial balance
debit credit
Cash 16,300
Vehicles 11,000
Accounts receivable 900
Supplies 300
Prepaid insurance 700
Unearned revenue 600
Common stock 17,000
Service revenue 15,200
Wages expense 700
Fuel expense 200
Rent expense 600
Dividends 2,100
Totals $32,800 $32,800
Here are data on two stocks, both of which have discount rates of 8%: Stock A Stock B Return on equity 8 % 5 % Earnings per share $ 2.60 $ 1.80 Dividends per share $ 1.30 $ 1.30 a. What are the dividend payout ratios for each firm? (Enter your answers as a percent rounded to 2 decimal places.) b. What are the expected dividend growth rates for each stock? (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.) c. What is the proper stock price for each firm? (Do not round intermediate calculations. Round your answers to 2 decimal places.)
Answer:
Please sew solution below
Explanation:
a. What are the dividend payout ratios for each firm
Dividend payout ratio = Dividend / EPS
• Payout ratio stock A = $1.30 / $2.6 = 0.5= 50%
• Payout ratio stock B = $1.3 / $1.8 = 0.72222 = 72.22%
b. What are the expected dividend growth rates for each stock.
Growth rate = ROE × (1 - dividend payout ratio)
•Growth rate stock A = 0.08 × (1 - 50%) = 0.04 = 4%
• Growth rate stock B = 0.05 × (1 - 72.22%) = 0.01389 = 1.39%
c. What is the proper stock price for each firm
• Stock A
Price = D1 / (Re - g)
D1= $1.30 * (1 + 0.04)
= 1.352
Stock B
Price = D1 / (Re - g)
D1= $1.30 * (1 + 0.013)
= 1.3169
Therefore,
• Stock A's proper price = $1.352 / (0.08 - 0.04) = $33.8
• Stock B's proper price = $1.3169 / ($0.08 - $0.013) = $19.66
In an efficient market, the price of a security will: _____________
a. always rise immediately upon the release of new information with no further price adjustments related to that information.
b. eact to new information over a two-day period after which time no further price adjustments related to that information will occur.
c. rise sharply when new information is first released and then decline to a new stable level by the following day.
d. react immediately to new information with no further price adjustments related to that information.
Most P2P apps or services can be linked to checking accounts, debit cards or _____
It should be noted that most P2P apps or services can be linked to checking accounts, debit cards or payment options
What is Peer-to-peer payment systems?Peer-to-peer payment systems can be regarded as the money transfer apps platform like Venmo.
It allows users to send money to people or organization.
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g Overhead costs are assigned to production using an overhead application rate, whereas no such "application rate" is used to assign the costs of direct materials and direct labor to production. The reason for this difference in procedures is that: Group of answer choices Overhead is always equal to a constant percentage of direct labor costs. Overhead is always larger in dollar amount than either direct materials or direct labor. Overhead is an indirect cost which cannot be traced easily and directly to specific units of product. The amounts of direct material and direct labor applicable to each unit of production cannot be determined as easily as the amount of overhead. None is correct.
Answer:
Overhead costs are assigned to production using an overhead application rate, whereas no such "application rate" is used to assign the costs of direct materials and direct labor to production. The reason for this difference in procedures is that:
Overhead is an indirect cost which cannot be traced easily and directly to specific units of product.
Explanation:
Manufacturing overhead costs are not direct costs. They are not generally traceable to units of products. They include such indirect costs as Depreciation Expense, Property Taxes, Indirect Labor, Indirect Materials, etc. No unit of product can be ascribed such costs except as an approximation.
Ethical Decision Making: A Mini-CaseYou are one of three stockholders who own and operate Mary’s Maid Service. The company has been operating for seven years. One of the other stockholders has always prepared the company’s annual financial statements. Recently, you proposed that the statements be audited each year because it would benefit the stockholders. The stockholder who prepares the statements proposed that his uncle, who has a lot of financial experience, can do the job at little cost. The other stockholder remained silent.Required:1. What position would you take on the proposal? Justify your response in writing.2. What would you recommend? Give the basis for your recommendation.
Explanation:
Analyzing the above case, the ideal would be to refuse the proposal that the uncle of a shareholder could be the auditor of the financial statements, as this could mean an unethical problem with the results of the statements for the benefit of a shareholder.
To maintain ethical and fair business for the three shareholders equally, the best solution would be to hire an external auditor, who would perform this function impartially so that the audit would issue an ethical and effective opinion on the company's financial situation in a legal manner .
Two companies, Ghost and Phantom manufacture similar printer color cartridges. The following data for the two companies for the year 2020 are provided below:
Ghost ($) Phantom ($)
Sales revenue 90,000 108,000
Total costs 63,000 72,000
Variable Costs 40 % of sales revenue 40%
Required:
1- Calculate the Break Even Point (BEP) in dollars for each company.
2- Calculate the percentage margin of safety for each company.
3- If sales of the product in Ghost company are equal to 3,000 units, determine the BEP (in units), and present the Break-even chart.
4- In 2020, Phantom plans to increase the variable cost by $4 while the fixed cost and the selling price will remain constant. Calculate the number of units to be sold in order to earn the same profit as Ghost in 2020 (the number of units for both Phantom and Ghost is equal to 3000).
5- Based on your answers to parts 1 and 2, Discuss which company has a safer financial position, and why.
1. The calculation of the break-even point in dollars is
Ghost ($) Phantom ($)
Break-even Point in dollars $45,000 $48,000
($27,000/60%) ($28,800/60%)
2. The calculation of the percentage margin of safety is as follows:
Ghost ($) Phantom ($)
Percentage margin of safety 50% 55.6%
($45,000/$90,000 x 100) ($60,000/$108,000 x 100)
The margin of safety = Sales revenue - break-even revenue
= $45,000 $60,000
3. The determination of the break-even units in Ghosts Company is as follows:
= Fixed costs/Contribution margin per unit
= 1,500 units ($27,000/$18)
4. The calculation of the number of units to be sold for Phantom Company to increase its variable cost by $4 ($18 from $14) with the fixed cost and the selling price remaining constant is 1,600 units ($28,800/$18).
What is a break-even chart?A breakeven chart shows the sales volume level at which total costs equal sales revenue.
In a break-even chart, losses are incurred below the break-even point, and profits are earned above the break-even point
Thus, the break-even chart plots revenue, fixed costs, and variable costs on the vertical axis, and volume on the horizontal axis.
Data and Calculations:Ghost ($) Phantom ($)
Sales revenue 90,000 108,000
Total costs 63,000 72,000
Variable Costs 40 % of sales revenue 40%
Variable costs = $36,000 $43,200 ($108,000 x 40%)
Contribution margin $54,000 $64,800
Fixed costs = $27,000 $28,800 ($72,000 - $43,200)
Contribution margin ratio 60% 60% (100% - 40%)
1. Break-even Point in dollars $45,000 $48,000 ($28,800/60%)
2. Percentage margin of safety 50% 55.6% ($60,000/$108,000 x 100)
The margin of safety = Sales revenue - break-even revenue
= $45,000 $60,000
3. Break-even units in Ghosts Company = Fixed costs/Contribution margin per unit
= 1,500 units ($27,000/$18)
Sales price per unit = $30 ($90,000/3,000)
Variable cost per unit = $12 ($36,000/3,000)
Contribution margin per unit = $18 ($30 - $12)
4. The calculation of the number of units to be sold for Phantom Company to increase its variable cost by $4 ($18 or $14 + $4) with the fixed cost and the selling price remaining constant is 1,600 units ($28,800/$18).
Sales price per unit = $36 ($108,000/3,000)
Variable cost per unit = $18.40 ($55,200/3,000)
Contribution margin per unit = $18 ($36 - $18)
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On March 1, Terrell & Associates provides legal services to Whole Grain Bakery regarding some recent food poisoning complaints. Legal services total $10,500. In payment for the services, Whole Grain Bakery signs a 8% note requiring the payment of the face amount and interest to Terrell & Associates on September 1.
Required:
For Terrell & Associates, record the acceptance of the note receivable on March 1 and the cash collection on September 1.
Answer:
March 1
Note Receivable $10500 Dr
Accounts Receivable $10500 Cr
September 1
Cash 10920 Dr
Note Receivable 10500 Cr
Interest Revenue 420 Cr
Explanation:
March 1.
The acceptance of note receivable by Terrell would mean that Terrell would create a new asset in the book namely Note receivable for $10500 and write off the asset named Accounts receivable against this amount. Thus, the entry would be to debit the note receivable and credit the accounts receivable.
September 1.
The Note pays interest at 8% annual rate. The note remains outstanding for 6 months from March to August. Thus, Terrell would receive the interest on note at 8% annual interest rate for 6 months. The amount of Interest revenue would be,
Interest revenue = 10500 * 0.08 * 6/12 = $420
Terrell would receive cash equal to the value of note receivable plus the interest on note receivable.
So, cash received would be = 10500 + 420 = 10920
Terrell will debit cash as it is received and credit the asset note receivable for 10500 to write it off and record interest revenue of $420
Which of the following might help you avoid financial stress?
A. Spending as little time thinking about your finances as possible
B. Deciding not to ask for help managing your finances
C. Sticking to your financial plan, even when things change
D. Learning financial skills
Answer:
I would put down C as the answer
Chipman Inc. produces water pumps. Overhead costs have been identified as follows:
Activity Pool Cost
Material handling $72,307.50
Machine maintenance $72,400.00
Setups $81,378.00
Activity Driver Activity
Number of moves 465
Number of machine hours 36,200
Number of production runs 66
Chipman makes 3 models of pumps with the following details:
Economy Standard Premium
Units produced 10,010 20,500 3,560
Number of moves 168 126 171
Machine hours 9,450 20,600 6,150
Production runs 26 14 26
Required:
a. Calculate the activity rate for each activity.
b. Determine the amount of indirect costs assigned to each of the products.
Answer:
Please see below and attached as requested.
Explanation:
a. Calculate the activity rate for each activity
• Material handling $155.5
• Machine maintenance $2
• Set ups $1,233
b. Determine the amount of indirect costs assigned to each of the product.
• Economy $77,082
• Standard $78,055
• Premium $70,948.5
Please find attached detailed computation of the above answers.