Answer:
Transfer price = $24
Explanation:
As per the data given in the question,
The excess capacity of Company's Southern division is nill therefore for transferring the units the division will have to decrease its external sales.The Loss occurred due to reduction in external sales should be from inter divisional transfer price. Therefore,
Transfer price = variable cost + Loss of contribution
= ($15 - $3) + ($27 - $15)
= $24
Assume the following: WIP, beginning 2 comma 500 units (100% complete as to direct materials, 50% complete as to conversion costs) Started 10 comma 500 units during the period Total spoilage is 700 with normal spoilage is calculated to be 550 units Completed and transferred out during the period 6 comma 000 units WIP, ending 6 comma 300 units (100% complete as to direct materials, 60% complete as to conversion costs) Spoiled units 700 and inspection happens when the process is 20% complete All materials are added at the start of the process Under the weighted average method, would would be the equivalent units of work done for the period? A. 9 comma 920 B. 10 comma 190 C. 6 comma 000 D. 6 comma 300
Answer:
B. 10 comma 190
Or none of the given
Explanation:
Particulars Units % of Completion Equivalent Units
Materials Conversion Materials Conversion
Transferred 6000 100 100 6000 6000
+Ending WIP 6300 100 60 6300 3780
+Normal Spoilage 550 100 60 550 330
+Abnormal
Spoilage 150 100 60 150 90
Total 13000 10200
As we see the total weighted Equivalent units for materials are 13000
and for conversion are 10200 . So the correct choice would be 10190 that is choice B which the nearest answer of the choices given to the answer calculated .
Under weighted method the Transferred out units are added to the ending work in process and the normal and abnormal spoilage is also added to find the equivalent units of production.
The other answer would be none of the given choices if exact figures are to be matched.
Which of the following statement(s) is(are) true regarding municipal bonds? I) A municipal bond is a debt obligation issued by state or local governments. II) A municipal bond is a debt obligation issued by the federal government. III) The interest income from a municipal bond is exempt from federal income taxation. IV) The interest income from a municipal bond is exempt from state and local taxation in the issuing state.
Answer:
I, III and IV Only.
Explanation:
A municipal bond is explained to be a debt obligation issued by a nonprofit organization, a private-sector corporation or another public entity using the loan for public projects such as constructing schools, hospitals and highways.
A municipal bond is categorized based on the source of its interest payments and principal repayments. A bond can be structured in different ways offering various benefits, risks and tax treatments. Income generated by a municipal bond may be taxable.
Answer: I) A municipal bond is a debt obligation issued by state or local governments.
III) The interest income from a municipal bond is exempt from federal income taxation.
IV) The interest income from a municipal bond is exempt from state and local taxation in the issuing state.
Explanation:
A municipal bond is usually a debt security issued by a state, or local government to finance its capital expenditures, which usually includes the construction of Roads, Bridges or Institutions( schools ). They can be considered as loans that an investor gives to local governments. This kind of bonds are exempted from federal taxes and most state and local taxes, Which makes them very attractive to interested individuals who are on high income tax brackets.
Crowl Corporation is investigating automating a process by purchasing a machine for $793,800 that would have a 9-year useful life and no salvage value. By automating the process, the company would save $133,000 per year in cash operating costs. The new machine would replace some old equipment that would be sold for scrap now, yielding $21,200. The annual depreciation on the new machine would be $88,200. The simple rate of return on the investment is closest to
a. 5.80%
b. 11.12%
c. 16.72%
d. 5.12%
Answer:
Simple rate of return is 5.8%
Therefore option (a) is correct option.
Explanation:
It is given that purchase cost = $793800
Company saving per year = $133000
Yielding = $21200
Annual depreciation = $88200
Annual profit = $133000 - $88200 = $44800
Net investment is equal to = $793800 - $21200 = $772600
Simple rate of return [tex]=\frac{44800}{772600}=0.0579[/tex]
= 5.8%
Therefore simple rate of return is 5.8 %
So option (a) is correct.
Dinklage Corp. has 9 million shares of common stock outstanding. The current share price is $69, and the book value per share is $8. The company also has two bond issues outstanding. The first bond issue has a face value of $70 million, a coupon rate of 6 percent, and sells for 94 percent of par. The second issue has a face value of $55 million, a coupon rate of 5 percent, and sells for 106 percent of par. The first issue matures in 24 years, the second in 9 years.Suppose the most recent dividend was $4.25 and the dividend growth rate is 4.4 percent. Assume that the overall cost of debt is the weighted average of that implied by the two outstanding debt issues. Both bonds make semiannual payments. The tax rate is 25 percent. What is the company’s WACC? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
Answer:
10.83%
Explanation:
The simplest way to determine the if we use the Gordon growth model for determining the company's stock price:
stock price = [dividend x (1 + growth rate)] / (WACC - growth rate)
dividend = $4.25g = 4.4%stock price = $69WACC - g = [dividend x (1 + g] / price
WACC = {[dividend x (1 + g] / price} + g
WACC = {[$4.25 x (1 + 4.4%] / $69} + 4.4% = 0.1083 or 10.83%
The following information is taken from the accounts of Latta Company. The entries in the T-accounts are summaries of the transactions that affected those accounts during the year. Manufacturing Overhead (a) 486,144 (b) 405,120 Bal. 81,024 Work in Process Bal. 10,880 (c) 754,000 298,500 90,500 (b) 405,120 Bal. 51,000 Finished Goods Bal. 39,000 (d) 662,000 (c) 754,000 Bal. 131,000 Cost of Goods Sold (d) 662,000 The overhead that had been applied to production during the year is distributed among Work in Process, Finished Goods, and Cost of Goods Sold as of the end of the year as follows: Work in Process, ending $ 24,480 Finished Goods, ending 62,880 Cost of Goods Sold 317,760 Overhead applied $ 405,120 For example, of the $51,000 ending balance in work in process, $24,480 was overhead that had been applied during the year. Required: 1. Identify reasons for entries (a) through (d). 2. Assume that the underapplied or overapplied overhead is closed to Cost of Goods Sold. Prepare the necessary journal entry. 3. Assume that the underapplied or overapplied overhead is closed proportionally to Work in Process, Finished Goods, and Cost of Goods Sold. Prepare the necessary journal entry.
Answer and Explanation:
As per the data given in the question,
1.
a) Cost of goods manufactured.
b) Cost of goods sold.
c) Overhead cost applied to work in process
d) Actual manufacturing overhead cost.
2. Journal Entry
Manufacturing overhead A/c Dr. 81,024
To cost of goods sold A/c. 81,024
3.
Work in process ending $24,480 =6.04%
Finished goods ending $62,880 =15.52%
Cost of goods sold $317,760 =78.44%
Total cost $405.120 =100%
To calculate overhead allocation :
Work in process ending = ($81,024× 6.04%) =$4,894
Finished goods ending = ($81,024 × 15.52%) =$12,575
Cost of goods sold = ($81,024 × 78.44%) = $63,355
Total cost = $81,024
Journal Entry
Manufacturing overhead A/c Dr. 81,024
To work in process A/c. $4,893
To finished goods A/c. $12,575
To cost of goods sold A/c. $63,555
Byron Books Inc. recently reported $6 million of net income. Its EBIT was $12.6 million, and its tax rate was 40%. What was its interest expense? [Hint: Write out the headings for an income statement, and then fill in the known values. Then divide $6 million of net income by (1 - T) = 0.6 to find the pretax income. The difference between EBIT and taxable income must be interest expense. Use this same procedure to complete similar problems.] Write out your answer completely. For example, 25 million should be entered as 25,000,000. Round your answer to the nearest dollar, if necessary. Do not round intermediate calculations.
Answer:
he35
Explanation:
h
The predetermined overhead rate for Zane Company is $5, comprised of a variable overhead rate of $3 and a fixed rate of $2. The amount of budgeted overhead costs at normal capacity of $150000 was divided by normal capacity of 30000 direct labor hours, to arrive at the predetermined overhead rate of $5. Actual overhead for June was $9500 variable and $6050 fixed, and standard hours allowed for the product produced in June was 3000 hours. The total overhead variance is
Answer:
Total Overhead Variance= $500 unfavorable
Explanation:
The total overhead variance is the difference between actual overhead and the applied overhead.
Actual Overhead = Variable + Fixed= $9500 + $6050= $ 15,550
Budgeted Overhead for 30000 direct labor hours = $ 150,000
Applied Overhead for 3000 hours = 3000 *$5= $15000
Total Overhead Variance= Actual Overhead Less Applied Overhead
= $15,500- $ 15000= $500 unfavorable
As actual is greater than applied it is unfavorable.
Answer:
$550 unfavorable.
Explanation:
Total actual overhead = $9,500 + $6,050 = $15,550
Total predetermined overhead = Predetermined overhead rate * Standard hours = $5 * 3,000 = $15,000
Total overhead variance = $15,550 - $15,000 = $550 unfavorable.
Note: It is unfavorable because total actual is greater than total predetermined overhead.
Scenario 28-1 Suppose that the Bureau of Labor Statistics reports that the entire adult population of Mankiwland can be categorized as follows: 25 million people employed, 3 million people unemployed, 1 million discouraged workers, and 1 million people who are either students, homemakers, retirees, or other people not seeking employment. Refer to Scenario 28-1. What is the unemployment rate?
Answer:
10.7%
Explanation:
Solution:
Recall that:
The Reports from Bureau of labor statistics is shown as follows:
Employed people = 25 million
Unemployed people = 3 million
Discouraged workers = 1 million
Workers or Homemakers or retirees, or students = 1 million
The next step from this scenario is to find out the unemployment rate
Now,
The rate of unemployed = (unemployed x 100 ) / labor force
= 300/28
=10.7%
Brownley Company has two service departments and two operating (production) departments. The Payroll Department services all three of the other departments in proportion to the number of employees in each. The Maintenance Department costs are allocated to the two operating departments in proportion to the floor space used by each. Listed below are the operating data for the current period: Service Depts. Production Depts. Payroll Maintenance Cutting Assembly Direct costs $ 20,400 $ 25,500 $ 76,500 $ 105,400 No. of personnel 15 15 45 Sq. ft. of space 10,000 15,000 The total cost of operating the Maintenance Department for the current period is:
Answer:
The total cost of operating the Maintenance Department for the current period is $29,580
Explanation:
In order to calculate The total cost of operating the Maintenance Department for the current period we would have to calculate first the Overhead allocated to Maintenance from Payroll department as follows:
Overhead allocated=Payroll overhead×(Maintenance payroll personnel/Total personnel)
Overhead allocated=$ 20,400×(15/15+15+45)
Overhead allocated=$4,080
Therefore, to calculate the The total cost of operating the Maintenance Department for the current period we would have to use the following formula:
Total cost of operating Maintenance Department=Overhead allocated+Direct overhead incurred
Total cost of operating Maintenance Department=$4,080+$25,500
Total cost of operating Maintenance Department=$29,580
The total cost of operating the Maintenance Department for the current period is $29,580
Which of the following is the most likely negative consequence of excessive change in an organization? Group of answer choices Staff being asked to do too much Staff being restricted to a single activity The operation of the organization at less than capacity The establishment of a system for prioritizing projects
Answer:
Staff being asked to do too much.
Explanation:
Excessive change in an organization is defined as a process when organizations pursue several differing, unrelated and sometimes changes that are conflicting simultaneously. It can also be, when an organization involves in introducing new changes before previous changes are being accomplished.
Additionally, when staffs or employees perceives change as being excessive, they react in various ways. Some of their reactions to excessive change includes;
• They become overwhelmed.
• Lack of motivation.
• They're stressed out.
• Frustration and anger builds among them.
• Inadequacy, uncertainty
and incompetence.
The lower level staffs and middle managers are most likely to experience, the negative consequence of excessive change in an organization because they're being asked to do too much.
January 1, 2021, Woody Forrest Corporation granted executive stock options to purchase 41,000 of its common shares at $9 each. The market price of common stock was $24 per share on December 31, 2021, and averaged $12 per share during the year then ended. There was no change in the 164,000 shares of outstanding common stock during the year. Net income for the year was $39,000. The number of shares to be used in computing diluted earnings per share for the quarter is:
Answer:
174,250 shares
Explanation:
The computation of the number of shares to be used in computing diluted earnings per share is shown below:
Proceeds from exercise of options (a) $369,000 (41,000 shares × $9)
Used to repurchased for common stock (b) 30,750 shares (41,000 shares × $9 ÷ $12)
Number of shares for exercised (c) 41,000 shares
Less: repurchased shares (d) -30,750 shares
Diluted common shares {e = c - d} 10,250 shares
Add: Common shares (f) 164,000 shares
Total number of shares for diluted earning per share 174,250 shares
We ignored the market price of common stock as it is not relevant.
Bob, Kara, and Mark are partners in the BKM Partnership. Bob is a 40% partner and has a June 30 tax yearminus−end. Kara owns a 40% interest in the partnership and has a September 30 tax yearminus−end, and Mark owns the remaining 20% interest and has an October 31 tax yearminus−end. The partnership does not have a natural business year. What is the required tax yearminus−end for the partnership (if no Sec. 444 election is made)? A. September 30 B. October 31 C. December 31 D. June 30
Answer:
D. June 30
Explanation:
Since no Sec. 444 election is made, the required tax yearmius-end for the partnership will be the tax yearminus−end of a partner with at least 40% interest.
Since Bob is a 40% partner and has a June 30 tax yearminus−end, therefore, the required tax yearminus−end for the partnership is June 30.
Suppose Mr. Lane just bought a share of BlueWind Co., a renewable energy startup. BlueWind promises to pay Mr. Lane $18 in dividends for one year and then the firm will shut down. Suppose that the liquidation value of the share is $3, and the rate of time preference is 5%. Then, according to the single-period dividend discount model, the present value of the cash payment received by Mr. Lane in one year would be
Answer:
The present value of the cash payment is $20
Explanation:
The present value of cash payment receivable by Mr Lane in one year's time is the today's equivalent amount of the dividend of $18 as well as the liquidation value of $3.
The present value is the total cash inflows multiplied by the discount factor
discount factor=1/(1+r)^n
where is the rate of time preference of 5%'
n is 1 i.e in one year's time
total cash inflows=$18+$3=$21
discount factor =1/(1+5%)^1=0.95238
present value of cash payment=0.95238*$21=$20
Levine Company uses the perpetual inventory system. Apr. 8 Sold merchandise for $9,300 (that had cost $6,873) and accepted the customer's Suntrust Bank Card. Suntrust charges a 4% fee. 12 Sold merchandise for $5,000 (that had cost $3,240) and accepted the customer's Continental Card. Continental charges a 2.5% fee. Prepare journal entries to record the above credit card transactions of Levine Company
Answer:
Dr Apr 08 Cash $8,928
Dr Credit Card Expense $372
Cr Sales $9300
Apr 08 Cost of goods sold $6,873
Merchandise inventory $6,873
Dr Apr 12 Accounts receivable- Continental $4,875
Dr Credit card expense $125
Cr Sales $5,000
Dr Apr 12 Cost of Goods Sold $3,240
Cr Merchandise Inventory $3,240
Explanation:
Levine CompanyJournal entries
Date General Journal Debit Credit
Dr Apr 08 Cash $8,928
Dr Credit Card Expense $372
(4%×9300)
Cr Sales $9300
Apr 08 Cost of goods sold $6,873
Merchandise inventory $6,873
Dr Apr 12 Accounts receivable- Continental $4,875
Dr Credit card expense $125
(2.5%×5000)
Cr Sales $5,000
Dr Apr 12 Cost of Goods Sold $3,240
Cr Merchandise Inventory $3,240
Peggy sells pistachios and almonds at the farmer’s market. She currently prices pistachios at $7 per bag and almonds at $4 per bag. She observes that every hour, 4 people each buy one bag of pistachios and 2 people each buy one bag of almonds. Having surveyed them, she learns that 2 of the pistachio buyers would be willing to pay $2 for the bag of almonds while the other two would only be willing to pay $1. Both almond buyers would be willing pay $5 for the bag of pistachios. Suppose Peggy decides to sell a bundle containing one bag of pistachios and one bag of almonds in addition to selling them separately. What price should she charge for the bundle in order to maximize revenue?
Answer:
The price she should charge for the bundle in order to maximize profit is 9
Explanation:
Solution
The total pistachios sold = 7 * 2 =14
The total almonds sold is = 4*1 = 4
So,
The total of both pistachios and almonds = 14 + 4 + 18
Thus,
we solve for getting average of the two which is:
Getting the average of the two in the bundle = 18/2
=9
Therefore p =9
Running Co. had an equity investment where it owned less than 20% of an investee, and therefore Running Co. was not able to exercise significant influence. Information about the investment is below: 20X1 20X2 Investment cost 170,000 170,000 Fair value 181,400 155,000 Total unrealized gain (loss) 11,400 (15,000) The company sold the investment during 20X3 for the below price: Sales price 192,400 What is the gain (loss) recorded in the income statement in the year of sale, in 20X3
Answer:
Gain or Loss to be reocrded in Financial Statement: 151600 - 155000= 3400 loss to be booked as Fair value recorded in the books as in year ended 20X2 is 155000.
