Answer: decrease in the fraction of equity used in the company's target capital structure
Explanation:
Retained earnings is the part of the net income that is left over for the business when the business has already paid out dividends to the shareholders. The retained earnings can be put back into the business.
A decrease in the fraction of equity used in the company's target capital structure will lead to an increase a company's retained earnings breakpoint.
In the course of selling a home to a buyer, a broker told the buyer that the home's foundation was "solid as a rock", when he knew for a fact that it was slowly sinking into the landfill on which it was built. In this situation, the broker's conduct would be BEST defined as a
Answer:
willful misrepresentation
Explanation:
Willful misrepresentation is an intentional act or misrepresentation of facts with an intent to deceive. It is an intentional action taken by one party, which constitutes a breach of representation with an intent or act to mislead the other party to whom such representation was made.
The above scenario is an example of wilful misrepresentation because the broker knew that the foundation of the house was faulty but willfully misrepresented fact by telling the buyer that the home's foundation was 'solid as rock'.
Kate's Diner offers one breakfast item, a breakfast special. The market price for this meal is $5. At her profit-maximizing level of output, Kate's average variable cost is $4 per meal. Her average total cost is $6 per meal. Since the market is perfectly competitive, Kate should ________.
Answer:
keep producing in the short run but exit the industry or go out of business in the long run
Explanation:
A perfect competition is characterised by many buyers and sellers of homogeneous goods and services. Market prices are set by the forces of demand and supply. There are no barriers to entry or exit of firms into the industry.
In the long run, firms earn zero economic profit. If in the short run firms are earning economic profit, in the long run firms would enter into the industry. This would drive economic profit to zero.
Also, if in the short run, firms are earning economic loss, in the long run, firms would exit the industry until economic profit falls to zero.
A firm should shut down in the short run if price is less than average variable cost. But since the diner's price is greater than average variable cost, it should continue production.
A firm should exit the industry in the long run if price is less than average total cost. the diner's price is less than average total cost, so it should shut down in the long run
On October 29, 2016, Lobo Co. began operations by purchasing razors for resale. Lobo uses the perpetual inventory method. The razors have a 90-day warranty that requires the company to replace any nonworking razor. When a razor is returned, the company discards it and mails a new one from Merchandise Inventory to the customer. The company’s cost per new razor is $20 and its retail selling price is $75 in both 2016 and 2017. The manufacturer has advised the company to expect warranty costs to equal 8% of dollar sales. The following transactions and events occurred.
2016
Nov. 11 Sold 105 razors for $7,875 cash.
30 Recognized warranty expense related to November sales with an adjusting entry.
Dec. 9 Replaced 15 razors that were returned under the warranty.
16 Sold 220 razors for $16,500 cash.
29 Replaced 30 razors that were returned under the warranty.
31 Recognized warranty expense related to December sales with an adjusting entry.
2017
Jan. 5 Sold 150 razors for $11,250 cash.
17 Replaced 50 razors that were returned under the warranty.
31 Recognized warranty expense related to January sales with an adjusting entry.
1.1 Prepare journal entries to record above transactions and adjustments for 2016.
2. How much warranty expense is reported for November 2016 and for December 2016?
Warranty Expense for November 2016 ?????
Warranty expense for December 2016 ?????
3. How much warranty expense is reported for January 2017?
4. What is the balance of the Estimated Warranty Liability account as of December 31, 2016?
5. What is the balance of the Estimated Warranty Liability account as of January 31, 2017?
Answer:
Nov 11
Dr Cash 7,875
Cr To Sale 7,875
Nov. 11
Dr Cost of Goods Sold 2,100
Cr To Inventory 2,100
Nov. 30
Dr Warranty Expenses 630
Cr To Warranty Liability 630
Dec. 9
Dr Warranty Liability 300
Cr To Inventory 300
Dec. 16
Dr Cash 16,500
Cr To Sales 16,500
Dec. 16
Dr Cost of Goods Sold 4,400
Cr To Inventory 4,400
Dec. 29
Dr Warranty Liability 600
Cr To Inventory 600
Dec. 31
Dr Warranty Expenses 1,320
Cr To Warranty Liability 1,320
1.b Journal Entries for 2017
Jan 5
Dr Cash 11,250
Cr To Sales 11,250
Jan 5
Dr Cost of goods sold 3,000
Cr To Inventory 3,000
Jan 17
Dr Warranty Liability 1,000
Cr To Inventory 1,000
Jan 31
Dr Warranty Expenses 900
Cr To Warranty Liability 900
2)a. Warranty Expenses= $630
2b. Warranty Expenses= $1,320
3). Warranty Expenses= $900
4). Estimated Warranty Liability Account $1,050
5). Estimated Warranty liability account $900
Explanation:
Preparation of the Journal entries for Lobo Co
Journal Entries for 2016 for Lobo Co
Nov 11
Dr Cash 7,875
Cr To Sale 7,875
Nov. 11
Dr Cost of Goods Sold 2,100
Cr To Inventory (20*$105) 2,100
Nov. 30
Dr Warranty Expenses 630
($7,875*8%)
Cr To Warranty Liability 630
Dec. 9
Dr Warranty Liability 300
(15*$20)
Cr To Inventory 300
Dec. 16
Dr Cash 16,500
Cr To Sales 16,500
Dec. 16
Dr Cost of Goods Sold 4,400
Cr To Inventory 4,400
(220 * $20)
Dec. 29
Dr Warranty Liability 600
(30*$20)
Cr To Inventory 600
Dec. 31
Dr Warranty Expenses 1,320
($16,500*8%)
Cr To Warranty Liability 1,320
1.b Journal Entries for 2017
Jan 5
Dr Cash 11,250
Cr To Sales 11,250
Jan 5
Dr Cost of goods sold 3,000
(150*$15)
Cr To Inventory 3,000
Jan 17
Dr Warranty Liability 1,000
(50*$20)
Cr To Inventory 1,000
Jan 31
Dr Warranty Expenses 900
(11,250*8%)
Cr To Warranty Liability 900
2)a. Warranty Expenses for Nov. 2016
Warranty Expenses= $7,875*8%
Warranty Expenses= $630
2b. Warranty Expenses for Dec. 2016
Warranty Expenses= $16500*8%
Warranty Expenses= $1,320
3). Warranty Expenses for Jan. 2017
Warranty Expenses= $11,250*8%
Warranty Expenses= $900
4). Estimated Warranty Liability Account as on Dec. 31, 2016
Estimated Warranty Liability Account= $630 + $1,320 - $300 - $600
Estimated Warranty Liability Account= $1950- $900
Estimated Warranty Liability Account= $1,050
5). Estimated Warranty liability account as on Jan. 31, 2017
Estimated Warranty liability account = $1,050 + $900 - $1,050
Estimated Warranty liability account= $900
What type of a service would a CPA perform if a loan that is collateralized by inventory requires a CPA to observe the count of the inventory and trace sampled items to the vendor invoices in order to determine the value of inventory is not misstated
Answer:
An attestation engagement.
Explanation:
An attestation engagement involves hiring a third party called a CPA to give attestation on subject matters or services like examinations, reviews, reports that are created by a client. The attestation engagement is a form of audit. The CPA is responsible for the client. It is of 3 types
1. The examination engagement
2. Review engagement
3. Agreed upon procedures engagement
Cash sales are normally 25% of total sales and all credit sales are expected to be collected in the month following the date of sale. The total amount of cash expected to be received from customers in September is:
Answer:
The total amount of cash expected to be received from customers in September is the sum of 25% of the September sales plus 75% of the August sales.
Explanation:
A donor gave $75,000 to a nongovernmental, not-for-profit charity with instructions that the funds be transferred to Sam Smith, an individual who lost his home in a fire. The not-for-profit would:
Answer:
B) Record the $75,000 cash and credit a liability
Explanation:
Possible options:
A) Record the $75,000 cash and credit temporarily restricted revenue. B) Record the $75,000 cash and credit a liability C) Do either (a) or (b), depending upon the policy of the not-for-profit D) Not record the transaction.Non-for-profit charities must record all cash donations, but since the funds were donated for an specific purpose, their use is restricted. Therefore, the charity must record a liability (which has a normal credit balance).
Sara spends $25 for an all-day ticket to an amusement park. After one ride, it begins to rain and she wishes she had never come. Since she has already paid for her ticket, she should stay at the amusement park until it closes or she has wasted her $25.A. TrueB. False
Answer:
False.
Explanation:
False, it is given that Sara spends $25 for all-day ticket in the amusement park. However, this is a shuck cost that she can not recover. Moreover, she has taken one ride so marginal analysis shows that all his $25 is not wasted. She has utilized some portion of their money so we can not say that she has wasted all his money.
Describe the role of securities markets and of investment bankers: what role do investment bankers playing securities markets
Answer
Explanation:
investment bankers specialize in the provision of new securities and they
provide helps to those that want their security liquified.
However, investment bankers are known with their role of provision of money at capital market to their customers such as companies or government set up through issuing of money or equity for security market.
Rovinsky Corporation, a company that produces and sells a single product, has provided its contribution format income statement for November. Sales (7,300 units) $ 350,400 Variable expenses 204,400 Contribution margin 146,000 Fixed expenses 103,500 Net operating income $ 42,500 If the company sells 7,200 units, its net operating income should be closest to:
Answer:
Net operating income= 40,500
Explanation:
Giving the following information:
Contribution margin 146,000
Fixed expenses 103,500
Sales= 7,200
First, we need to calculate the unitary contribution margin:
Unitary contribution margin= 146,000/7,300= $20
Now, for 7,200:
Total contribution margin= 7,200*20= 144,000
Fixed costs= (103,500)
Net operating income= 40,500
what can you tell me about google's product cycle pricing strategies ?
Answer:
The value-based pricing strategy determines prices based on customers' perceived value of the product. In Google's marketing mix, the value-based pricing strategy is used for its AdWords online advertising service, where advertisers could place bids based on their perceptions of the importance of these advertisements.This method establishes pricing depending on the preferences of clients.
Explanation:
The value-based pricing method bases charges on the financial importance of the product by customers.
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Felix launched both a Google Search Ad campaign and a Google Display Ad campaign to drive sales of tools on his home improvement website. He reviewed his sales data after two weeks and noticed his Search Ad campaign is the most successful. Which optimization type should Felix use if he wants to use bidding or targeting to acquire more customers?
Complete Question:
Felix launched both a Google Search Ad campaign and a Google Display Ad campaign to drive sales of tools on his home improvement website. He reviewed his sales data after two weeks and noticed his Search Ad campaign is the most successful. Which optimization type should Felix use if he wants to use bidding or targeting to acquire more customers?
Group of answer choices.
A. Channel
B. Media Mix
C. Attribution
D. Placements
Answer:
A. Channel.
Explanation:
In this scenario, Felix launched both a Google Search Ad campaign and a Google Display Ad campaign to drive sales of tools on his home improvement website. He reviewed his sales data after two weeks and noticed his Search Ad campaign is the most successful. The optimization type Felix should use if he wants to use bidding or targeting to acquire more customers is channel.
A Google Search Ad campaign involves changing the way or manner in which Ads are delivered to potential viewers (visitors) within a specific channel so as to boost a business. Basically, there are three (3) main types of channel optimization used in the Google Search Ad campaign and these are;
1. Bidding: it is used to get more customers by adjusting bids with respect to a comprehensive set of auction-time signals which targets your adverts.
2. Creative: it involves customizing assets to give or display the right and necessary information to the right customer at the right time.
3. Targeting: it involves the process of reaching the individuals or customers who are very much interested in your business through the dynamic and broad audience targeting.
The owners of Spokes Bicycle Shop worry that cash flow this winter may be insufficient to meet the current operating expenses. While they anticipate a surplus of cash inflow as warm weather approaches, they need funds now to meet the company's immediate obligations. The owners can best resolve cash flow concerns by obtaining ________ financing.
Answer:
Short-term.
Explanation:
Short-term can be explained to be financing of business for short period of time from different sources. This financing are seen to be in the periods of a year and is said to be for smaller scale businesses.
It is easily necessary to secure additional funds to cover expenses, especially for those smaller businesses or to take the next step in growing the business. These short term loans are seen to be a lending option that work for many businesses that experience seasonal revenue fluctuations, and are easily taken back from the enterprise on a daily basis or monthly to cover up for the year.
The ______________ of estimating bad debts expense involves a detailed listing of each customer's outstanding account and its length of time past due i Multiple Choice Direct write-off method. Percentage of sales method.
Answer:
Aging of accounts receivable method.
Explanation:
Accounts receivable are the payments owed to a business by its customers. Bad debt occurs when there is uncertainty that an account receivable will be recovered.
The accounts receivable aging method is used to classify debts based on on the length of time past due.
Classifications such as are based on length of time past due and when to time past due is too long it will be considered to be a loss.
Lengths of time used include: 1-30 days past due, 31-60 days past due, 61-90 days past due, 91-120 days past due, and greater than 120 days past due.
College dorm residents frequently want to keep and prepare their own food and snacks to save money or have a late-night snack. However, their dorm rooms are often woefully short of space. MicroFridge understands this and markets a combination microwave, refrigerator, freezer, smoke sensor, and charging station appliance targeted to these students. MicroFridge is most likely using which basis of segmentation
Answer:
behavioral segmentation
Explanation:
Based on this scenario, it can be said that MicroFridge is using behavioral segmentation. This is a form of marketing segmentation that focuses on dividing individuals into different groups based on their specific behavioral patterns that they share in common. Which in this case is the fact that the students tend to keep and prepare their own food and snacks to save money. By targeting individuals with these behaviors they are more likely to sell their product due to its unique features that become beneficial to individuals exhibiting these behaviors.
Tech giant, TimeHop was concerned about creating a workspace that was inviting and encouraged collaboration. Knowing that most of its employees would work odd hours, there was care taken to lighting choices and types of furniture. TimeHop was concerned with
Answer:
physical design
Explanation:
TimeHop was concerned about creating a workspace that was inviting and encouraged collaboration and here TimeHop was concerned with physical design because the reason for this is the the firm tailored their work space to the needs of employees thus being concerned with physical designso answer is physical designLinks Cable Network has decided to offer a one-hour appointment window for customers needing installation or repair of its service, which will require the company to have several technicians on call. Links hopes this practice will give it an advantage over the competition, none of which have adopted such a practice. Links Cable Network is introducing a(n) ______ change.
Answer:
Radically innovative.
Explanation:
In this scenario, Links Cable Network has decided to offer a one-hour appointment window for customers needing installation or repair of its service, which will require the company to have several technicians on call. Links hopes this practice will give it an advantage over the competition, none of which have adopted such a practice. Links Cable Network is introducing a radically innovative change.
A radically innovative change is a strategic business approach aimed at developing the business drastically.
Carfax offers a report on used cars for $39.99. It details the ownership type and history, vehicle mileage, accident reports, and other information. Carfax is an example of how markets try to:
Answer:
lessen the lemons problem by reducing asymmetric information.
Explanation:
Since in the question it is mentioned that the Carfax offered a report on a cars that are used for $39.99. The information involves type of ownership, history, vehicle mileage, accident reports, and other type of information
Based on the above information, the markets lowered the lemon problem i.e. asymmetric information that represents the failure of information
Company had 200 units of inventory on hand at the end of the year. These were recorded at a cost of $12 each using the last-in, first-out (LIFO) method. The current replacement cost is $10 per unit. The selling price charged by Sandra Company for each finished product is $15. In order to record the adjusting entry needed under the lower-of-cost-or-market rule, the Cost of Goods Sold will be:
Answer:
Debited by $400
Explanation:
Calculation for the Cost of Goods Sold
Using this formula
Cost of Goods Sold= Inventory on hand*(Cost-Current replacement cost)
Let plug in the formula
Cost of Goods Sold=200 units * ($12 - $10)
Cost of Goods Sold= 200 units*2
Cost of Goods Sold = $400 Debited
Therefore the Cost of Goods Sold will be:$400 Debited
At Groovy Rags, a trendy retail store, manager Eon Forcer doesn't waste any time thinking about whether the employees on his shift get their breaks at a reasonable time. In fact, he claims he is hard pressed to determine which one has "worked hard enough" to even deserve a break. Earlier today, Eon remarked, "I've never met one that likes this job! They're only biding their time and here for the money." Eon's managerial style would be classified as _______.
Answer:
Theory X.
Explanation:
In this scenario, Groovy Rags, a trendy retail store, manager Eon Forcer doesn't waste any time thinking about whether the employees on his shift get their breaks at a reasonable time. In fact, he claims he is hard pressed to determine which one has "worked hard enough" to even deserve a break. Earlier today, Eon remarked, "I've never met one that likes this job! They're only biding their time and here for the money." Eon's managerial style would be classified as Theory X.
Douglas McGregor developed the theory x and y in the 1950s while working at the MIT Sloan school of management.
Theory X suggests that employees working in a particular organization dislike work, possess minimal ambition, and are generally not willing to take up responsibility.
Hence, with the Theory X it is very important and essential that these employees be supervised and rewarded externally with prizes and punishment should be used when they err.
"Jobs Now is an employment website. Like its competitors, it offers free listings in every category, which is free for job seekers but not for companies. This feature of Jobs Now is an example of"
Answer:
A revenue model
Explanation:
A revenue model is a business organizational framework and strategy for balancing a business expenditure and income generation per revenue stream outlined by the business by identification of the veritable revenue sources, the structure of the pricing for the access to the value derived from the revenue source, as well as how customers are to pay for the value of the services of the revenue source
In essence, a revenue model maps value to buyers of a given valuable product.
All of the following are reasons that the statement of cash flows is useful to the analyst except: A. The statement of cash flows shows how cash is generated during an accounting period and how it has been used. B. A positive net income figure on the income statement is ultimately insignificant unless a company can translate its earnings into cash, and the only source in financial statements for learning about cash generation is the statement of cash flows. C. The statement of cash flows shows the adjustments made to net income in order to calculate cash flow from operations; those should be examined to determine why cash flow from operations is negative or positive. D. The statement of cash flows is the only financial statement that cannot be manipulated.
Answer: The statement of cash flows is the only financial statement that cannot be manipulated
Explanation:
The cash flow statement is used to know how much cash is coming into and going out of a business.
The statement of cash flows shows the adjustments that can be made to the net income to calculate cash flow from operations.
The assumption that the statement of cash flows is the only financial statement that cannot be manipulated is wrong.
The statement of cash flows is the only financial statement that cannot be manipulated is not reason that the statement of cash flows is useful to the analyst.
Cash flow statements are important for all investors, which makes financial analysts increase the inflow of cash flow so that it looks good for investors and becomes confident in the business.
Therefore, cash flow is essential in providing cash availability its inflow and outflow to accountants as well as analysts that is further used for developing income statements.
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At his last review, Lazar was told that his reports succeed at projecting a positive tone, but do not seem objective enough. Lazar has asked you, as a trusted colleague, to give him advice on how to improve that aspect of his work. Which of the following will you tell him?A. Use bulleted or enumerated lists to reduce the density of information.B. Provide information, analysis, and advice that is sound, reliable, and unbiased.C. Include an executive summary that provides the quick story of the report.D. Provide a well-designed table of contents.E. Use tables and charts in your report to represent numerical information.
Answer:
B
Explanation:
One of the top characteristics of a good report is that it must maintain a good degree of objectivity .In a good report , enthusiasm and positive emotion should not overtake the judgement of the writer. This means that it must tot be biased in any way and at the same time delivers the desired objective.
Advising Lazar on improving his report , he has to provide information, analysis, and advice that is sound , reliable , and unbiased.
Jose Suarez has been hired as sales manager at a new firm and is trying to come up with a sales force compensation method. He would like to have selling expenses relate directly to sales resources, an aggressive sales force, and minimization of non-selling tasks. What compensation method(s) would best fulfill his requirements
Answer:
straight commission
Explanation:
Straight commission refers to the commission in which only a sales percentage could be given in terms of commission no extra payment, no salary is given. The percentage could be based on the performance of the salesperson i.e how much sales he sold so according to that the percentage is given
Therefore the given situation represents the straight commission method
Milner Developers proposed an offer to Henry Wright,an independent contractor,offering to hire him for their next project.They offered him a certain rate and specified the contract details along with describing the stipulated mode of acceptance but received no response.Wright responded to the offer after a delay of two months with a quote for a higher amount than that mentioned by Milner Developers.Do the two parties have a binding contract?
A) No,because the offer made by Milner Developers was ambiguous.
B) No,because Wright's letter was a counteroffer to the original offer.
C) Yes,because Milner Developers did receive a response from Wright.
D) Yes,because Wright's silent signaled his acceptance of the offer.
Answer: b. No, because Wright's letter was a counteroffer to the original offer.
Explanation:
Contract is issued based on a binding agreement between two parties, the employer and the employee. The employer gives the terms and conditions which embeds the allowances, while the employee receives the letter and is either expected to give a response there or after a specific period of time, the letter cannot be changed by the employee after delay but there could be negotion within the time frame given. Wright had to offence to be blamed for; 1) he delayed the response. 2) Requesting a higher amount after a long while.
On January 1, 2017, Ann Price loaned $157773 to Joe Kiger. A zero-interest-bearing note (face amount, $210000) was exchanged solely for cash; no other rights or privileges were exchanged. The note is to be repaid on December 31, 2019. The prevailing rate of interest for a loan of this type is 10%. The present value of $210000 at 10% for three years is $157773. What amount of interest income should Ms. Price recognize in 2017
Answer:
15,777
Explanation:
Given the following :
Amount loaned = $157,7723
Prevailing Interest rate on such loan = 10%
Recognizable interest:
Amount loaned * Interest rate
$157,773 * 10%
157,773 * 10
15,777.3
= 15,777( to the nearest thousand)
Therefore, the amount of income Ms. Price will recognize in 2017 is $15,777.
"An individual who is 25 years from retirement has $500,000 to invest today. He is risk tolerant and is looking to withdraw $80,000 per year once he retires. Which asset allocation is BEST for this client?"
The available options are:
A. 25% Stocks / 25% Bonds / 25% REITs / 25% Money Markets
B. 50% Stocks / 40% Bonds/ 10% Cash
C. 100% Bonds
D. 100% Stocks
Answer:
B. 50% Stocks / 40% Bonds/ 10% Cash
Explanation:
Since the age of the customer is not given in the question, however, given he or she is 25 years from retirement, it is logical to assume that the customer is about 40-50 years old in age. According to the rule of thumb that "100% minus the customer's age" should be allocated to stocks for growth, hence, a stock allocation of 40-50% is about right.
Hence, in this case, the right answer is Option B: 50% Stocks / 40% Bonds/ 10% Cash
A greenfield venture in a foreign market is A. one where the company creates a subsidiary business by setting up all aspects of the operation upon entering the market from the ground up. B. one where foreign facilities and marketing strategies are shared withlocal businesses. C. one where the company learns through training by the foreign entity on how to compete. D. one that supports exports into a foreign market by marketing indirectly thru local rivals. E. one that offers lower risk and a faster path to returns by building in rural areas.
Answer:
A. one where the company creates a subsidiary business by setting up all aspects of the operation upon entering the market from the ground up.
Explanation:
Greenfield Investment is one of the types of foreign direct investment. In this type of investment, new branches of a company are created in different countries. The operational team functions from the parent company. The parent companies have full control over the functioning, control, and quality of the subsidiary companies. The employees are provided with the training of the standard level as proposed by the parent company.
Joan, who has a PhD in economics, has been employed as an agent by Gibraltar Securities for the past 15 years. Missing academic life, she resigns from the broker-dealer and accepts a position as an economics professor at a state university. Which, if any party, is required to notify the state securities Administrator of this change
Answer:
both the agent in question as well as the former broker/dealer are required to notify the Administrator promptly.
Explanation:
In the specific scenario that is being described both the agent in question as well as the former broker/dealer are required to notify the Administrator promptly. This is mainly due to the fact that the license that an agent possesses expires as soon as they cease to be employed by the broker/dealer and/or issuer for whom they were previously licensed. Therefore this information needs to be presented immediately to the securities administrator and her license needs to be revoked.
Budget performance report for a cost center GHT Tech Inc. sells electronics over the Internet. The Consumer Products Division is organized as a cost center. The budget for the Consumer Products Division for the month ended January 31 is as follows: Customer service salaries $546,840 Insurance and property taxes 114,660 Distribution salaries 872,340 Marketing salaries 1,028,370 Engineer salaries 836,850 Warehouse wages 586,110 Equipment depreciation 183,792 Total $4,168,962 During January, the costs incurred in the Consumer Products Division were as follows: Customer service salaries $602,350 Insurance and property taxes 110,240 Distribution salaries 861,200 Marketing salaries 1,085,230 Engineer salaries 820,008 Warehouse wages 562,632 Equipment depreciation 183,610 Total $4,225,270
1. Prepare a budget performance report for the director of the Consumer Products Division for the month of January. If an amount box does not require an entry, leave it blank GHT Tech Inc. Budget Performance Report-Director, Consumer Products Division For the Month Ended January 31 Actual Budget Over Budget Under Budget Customer service salaries $ Insurance and property taxes Distribution salaries Marketing salaries Engineer salaries Warehouse wages Equipment depreciation Total
2. For which costs might the director be expected to request supplemental reports?
1. Customer service salaries and marketing salaries as they are significantly over budget.
2. Customer service salaries, warehouse wages and marketing salaries as they have significantly changed.
3. Engineering salaries and warehouse wages as they are significantly under budget.
Answer:
A.Actual $4,225,270
Budget $ 4,168,962
Over budget $112,370
Under budget $56,062
B. The director be expected to request supplemental request for Customer service salaries, warehouse wages and marketing salaries as they have significantly changed.
Explanation:
Preparation of the budget performance report for the director of the Consumer Products Division for the month of January.
GHT Tech Inc.
Budget Performance Report for Director, Consumer Products Division For the month ended January 31
Actual Budget Over budget Under budget
Customer Service Salaries $ 602,350 $ 546,840 $ 55,510 Over budget
Insurance and Property Taxes
110,240 114,660 $ 4,420 Under budget
Distribution Salaries 861,200 872,340 11,140 Under budget
Marketing Salaries 1,085,230 1,028,370 56,860 Over budget
Engineer Salaries 820,008 836,850 16,842 Under budget
Warehouse Wages 562,632 586,110 23,478 Under budget
Equipment Depreciation 183,610 183,792 182 Under budget
Totals
Actual $4,225,270
Budget $ 4,168,962
Over budget $112,370
Under budget $56,062
2. The director be expected to request supplemental reports for Customer service salaries, warehouse wages and marketing salaries as they have significantly changed.
A company has a selling price of $2,150 each for its printers. Each printer has a 2 year warranty that covers replacement of defective parts. It is estimated that 3% of all printers sold will be returned under the warranty at an average cost of $157 each. During November, the company sold 37,000 printers, and 470 printers were serviced under the warranty at a total cost of $62,000. The balance in the Estimated Warranty Liability account at November 1 was $32,500. What is the company's warranty expense for the month of November
Answer:
$174,270
Explanation:
The computation of the warranty expense for November is shown below:
= Number of printed sold × estimated percentage × average cost
= 37,000 printers × 3% × $157
= 1,110 printers ×$157
= $174,270
We simply applied the above formula so that the company warranty expense for November month could come and the same is to be considered
