Answer:
Alternative Depreciation Methods
(a) the straight-line method calculations:
Annual depreciation expense for each of the five years of use = $142,000 ($710,000/5)
(b) the double declining- balance method calculations:
Depreciation rate = 100%/5 * 2 = 40%
1st year Depreciation = $320,000 ($800,000 * 40%)
2nd year Depreciation = $192,000 ($480,000 * 40%)
3rd year Depreciation = $115,200 ($288,000 * 40%)
4th year Depreciation = $69,120 ($172,800 * 40%)
5th year Depreciation = $13,680 ($103,680 - $90,000)
2. Journal Entries (double-declining-balance method):
Debit Sale of Equipment $800,000
Credit Equipment $800,000
To transfer the equipment to Sale of Equipment account.
Debit Accumulated Depreciation $696,320
Credit Sale of Equipment $696,320
To transfer the accumulated depreciation to Sale of Equipment account.
Debit Cash $135,000
Credit Sale of Equipment $135,000
To record the proceeds from the sale of the equipment.
3. Journal Entries (double-declining-balance method):
Debit Sale of Equipment $800,000
Credit Equipment $800,000
To transfer the equipment to Sale of Equipment account.
Debit Accumulated Depreciation $696,320
Credit Sale of Equipment $696,320
To transfer the accumulated depreciation to Sale of Equipment account.
Debit Cash $88,750
Credit Sale of Equipment $88,750
To record the proceeds from the sale of the equipment.
Explanation:
a) Data and Calculations:
Cost of the new lithographic equipment = $800,000
Estimated useful life = 5 years
Estimated residual value = $90,000
Depreciable amount = $710,000 ($800,000 - $90,000)
Sales proceeds in the first week of the fifth year = $135,000
Amazon Corporation owns machinery with a book value of $760,000. It is estimated that the machinery will generate future cash flows of $700,000. The machinery has a fair value of $560,000. Amazon should recognize a loss on impairment of:_______.
Answer: $200,000
Explanation:
The loss on impairment refers to the difference between the carrying or book value of an asset and the fair/ recoverable value of same.
Loss on impairment = Book value - Fair value
= 760,000 - 560,000
= $200,000
The value of the machinery would fall by $200,000 to tally it to its fair value.
Menning Inc. uses a job-order costing system in which any underapplied or overapplied overhead is closed out to cost of goods sold at the end of the month. The company has provided the following data for June:
Direct materials $78,750
Direct labor cost $94,000
Manufacturing overhead cost incurred $61,275
Manufacturing overhead cost applied $65,800
Inventories: Beginning Ending
Work in process $17,500 $19,850
Finished goods $61,500 $38,250
The cost of goods sold that appears on the income statement for August and that has been adjusted for any underapplied or overapplied overhead is closest to: __________
a. $254,925
b. $263,975
c. $236,200
d. $259,450
Answer:
Adjusted COGS= $254,925
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
cost of goods manufactured= 17,500 + 78,750 + 94,000 + 65,800 - 19,850
cost of goods manufactured= $236,200
Now, the COGS:
COGS= beginning finished inventory + cost of goods manufactured - ending finished inventory
COGS= 61,500 + 236,200 - 38,250
COGS= $259,450
Finally, the over/under applied overhead and the adjustment:
Under/over applied overhead= real overhead - allocated overhead
Under/over applied overhead= 61,275 - 65,800
Overapplied overhead= $4,525
As overhead was overapplied, COGS must be reduced:
Adjusted COGS= 259,450 - 4,525
Adjusted COGS= $254,925
Beth owns a corporate office park in Ohio. Her ownership rights include the right to sell or give away the property without restriction, as well as the right to commit waste, if she chooses. Beth's ownership interest is:
Answer:
Fee Simple Absolute
Explanation:
The 6 types of modern freehold estates, distinguished by duration includes;
1. Fee simple absolute
2. Life estate
3. Fee tail
4. Fee simple determinable
5. Fee simple subject to a condition subsequent
6. Fee simple subject to an executory limitation
And also
The types of Fee Simple includes
A) Fee Simple Absolute
B) Defeasible Fees
Fee Simple Absolute
This is regarded as an absolute ownership. It is a never ending period of time with no hindrance or limitations on its inheritability. it also cannot be ended or shuffled on the happening of any event. It is also regarded as the right to possess now, even until the end of time.
Its characteristics includes:
1. The holder has all the rights or entitlement.
2. The duration is never ending that is, the interest is absolute because the interest will not end on the occurrence of an event or condition
3. There is no future interest that follows it
3. The owner has the right of possession, alienation, and exclusion
And others.
Benny is the manager of an office-support business that supplies copying, binding, and other services for local companies. He must replace a worn-out copy machine that is used for black-and-white copying. He is considering two machines, and each of these has a monthly lease cost plus a cost for each page that is copied. Machine 1 has a monthly lease cost of $619, and there is a cost of $0.030 per page copied. Machine 2 has a monthly lease cost of $675, and there is a cost of $0.028 per page copied. Customers are charged $.16 per page copied. If Benny expects to make 105,000 copies per month, what would be the monthly cost for each machine
Answer:
Machine one cost:
= Fixed cost + Variable cost
The Fixed cost is the lease cost and the variable cost is the cost per page copied. The number of pages is 105,000 and the cost per page for machine 1 is $0.030
= 619 + (0.030 * 105,000)
= $3,769 monthly
Machine two cost:
= 675 + (0.028 * 105,000)
= $3,615 monthly
Jill has recently begun working at a local florist. In addition to creating floral arrangements, Jill spends a good deal of her time talking to customers and ringing up sales. Over time, she identifies a weakness in the procedures for ringing up voids. No approval is neces- sary to void a sale, and the void slip collects very little information about the sale. After Jill has completed a sale and the customer has left, she voids the sale and pockets the cash that was just received. The floral shop doesn’t miss the lost inventory because it has a high inventory turnover ratio and high losses due to flowers losing their bloom.
1. What type of fraud is Jill committing?
2. What could the florist do to prevent this type of fraud from occurring?
Answer: See explanation
Explanation:
1. What type of fraud is Jill committing?
The fraud that Jill is committing is known as theft of cash through fraudulent disbursements. In this case, Jill is using a register disbursement scheme which involves false voids of customer sales. During the time of sale, a record is made and another record is then created again which is used for the false void.
2. What could the florist do to prevent this type of fraud from occurring?
To prevent this fraud, a receipt should be attached and the florist should make sure that every vital information about all sales are collected such as customers name, time, amount of goods bought, signature and f customers etc
Frank Corporation manufactures a single product that has a selling price of $25.00 per unit. Fixed expenses total $64,000 per year, and the company must sell 8,000 units to break even. If the company has a target profit of $19,000, sales in units must be:________.a. 9,648b. 8,760c. 10,375d. 10,560
Answer:
Break-even point in units= 10,375
Explanation:
Giving the following information:
Selling price= $25
Fixed cost= $64,000
Break-even point in units= 8,000
First, we need to determine the unitary contribution margin:
Break-even point in units= fixed costs/ contribution margin per unit
8,000 = 64,000 / contribution margin per unit
contribution margin per unit8,000= 64,000
contribution margin per unit= 64,000 / 8,000
contribution margin per unit= $8
Now, the number of units to be sold to make a profit of $19,000:
Break-even point in units= (fixed costs + desired profit) / contribution margin per unit
Break-even point in units= (64,000 + 19,000) / 8
Break-even point in units= 10,375
A company has 1000000 shares outstanding trading at $15 a piece. Managers believe that the discount rate appropriate for the risk borne is 15% and total cash flows, expected to be $1 million next year, will rise by 5% per year indefinitely. Discuss a strategy that is beneficial to the current shareholders.
Answer:
Explanation:
Knowing the value of the equity and establishing the intrinsic worth of the share may help you develop a perfect strategy that will benefit the current shareholders.
Value of the equity = Cashflow÷(discount rate - growth rate)
= $1,000,000 ÷ (15%-5%)
= $1,000,000 ÷ (10%)
= $10,000,000
Intrinsic value per share = Value of the equity ÷ Shares outstanding
= $10,000,000 ÷ 1,000,000
= $10
For the share, The intrinsic value = $10
However, since the current trading share price is $15, then we can posit that the share price is over-valued.
As a result, the perfect strategy that will be beneficial to the shareholders is for the current shareholders to sell the shares (short selling at a high price and purchasing at a low price).
Segway focuses on the personal people-mover market of individuals who need to move longer distances with ease. Its stand-up scooter is used in two narrow markets: tourist tours and warehouse employee movement. What type of marketing strategy should this company use
Answer:
The correct answer is "Differentiated marketing".
Explanation:
A marketing approach involving the promotion of a manufacturer portfolio which transfers from one sector of the economy would be known as Differentiated marketing.That alone contributes to better awareness, to a greater audience, towards consumer requirements including more revenues.Thus the above is the correct answer.
The text defines management as “The art of getting things done through the efforts of other people.” Put yourself in the shoes of a manager and explain what this definition means in the context of a company operation. You can use the example of any company (large or small) and any good or service.
The correct answer to this open question is the following.
Although you did not attach the text, we can comment on the quote.
"The art of getting things done through the efforts of other people.”
This quote means that good managers motivate and positively influence employees to get the job done. Managers coordinate and monitor the work of the employees. Managers first plan, then establish the goals to be accomplished and then direct the work effort to be productive.
If I were a manager of a company, I definitely try to emulate what the quote says. For instance, the manager of a recreational and sports club. I would do everything to establish clear, specific, and attainable goals so my employees could understand them. Then I describe the role and responsibilities of each employee so they can do their job without any doubts. And of course, I would delegate so they can do their jobs happily. No unnescesary intromissions. The objective would be to offer the best service possible to our clients.
Based on your understanding of bond ratings and bond-rating criteria, which of the following statements is true?A) BBB bonds usually have the lowest yields in the bond markets.B) US government bonds usually have the lowest yields in the bond markets.
Answer: US government bonds usually have the lowest yields in the bond markets.
Explanation:
Based on the understanding of bond ratings and bond-rating criteria, it should be noted that the US government bonds usually have the lowest yields in the bond markets.
The statement that "BBB bonds usually have the lowest yields in the bond markets" is incorrect.
A taxpayer's spouse dies in August of the current year. Which of the following is the taxpayer's filing status for the current year?
a. Single.
b. Qualified widow(er).
c. Married filing jointly.
d. Head of household.
Answer:
b. Married filling jointly
Explanation:
From the question we are informed about taxpayer's spouse who dies in August of the current year. In this case,
the taxpayer's filing status for the current year would be Married filling jointly. Joint return can be regarded as tax return which is been filed with the Internal Revenue Service by two married taxpayers that decide to have a filing status of "married filing jointly" or a widowed taxpayer that decide to have a filing status of " Qualifying Widow "A joint return give room for the
taxpayers to join their tax liability as well as report their income, credits and
deductions on the same joint return.
The joint return rates still validly
apply even two year after the death of a particular spouse, so far the
surviving spouse of the dead spouse does not remarry and still maintains a household as regards a dependent child.
illings and collections between an Enterprise Fund and the General Fund A city uses an Enterprise Fund to provide electricity to its citizens and to its General Fund. A total of $50,000 was billed to the General Fund and collected 30 days later. Prepare the journal entries necessary to record these transactions, and label the fund(s) used. Note: Under the Fund column, select the appropriate fund in which the transaction is recorded (GF: General Fund or ISF: Internal Service Fund).
Answer:
Enterprise Fund due from General Fund (Dr.) $50,000
Revenue from service (Cr.) $50,000
Explanation:
The enterprise fund is used to provide electricity to the citizens. The revenue will be recorded as service charges for providing the electricity. Enterprise fund will be due from General fund which is billed for $50,000.
Jason Ford, the CEO of the Green-Plus Company, was known among businesspeople for his qualities of self-discipline, friendliness, caring, courage, compassion, trust, and humility. This example shows that a _______ is a character trait valued as being good.
Answer: virtue
Explanation:
Virtue is refered to as the behavior whereby one shows high moral standards. It is the quality posseses by someone when the person is morally good.
Since Jason Ford has qualities such as self-discipline, caring, trust, friendliness, courage, compassion, and humility, then virtue can be said to. Be valued as being good.
From June 2008 oil was at a high of $144.78 per barrel. During the period from April 2011 until July of 2014, the price of oil hovered between about $115.32 per barrel and about $105.22 a barrel. Then, starting in August 2014 oil began a precipitous fall in price from the $105.22 to $33.62 a barrel in January 2016. Although the U.S. has great amounts of oil that can be brought out of the ground by “fracking,” by the beginning of 2016 many of the workers in the U.S. oil exploration and drilling industry were out of work and tremendous amounts of oil exploration equipment was sitting in the equivalent of “used car lots” to be sold.
Answer:
The explanation of the subject is described in the following part of the discussion.
Explanation:
The idea which should generally be used in this instance seems to be that individuals are generally motivated by motivations and take advantage of chances to improve. Because when a group continues operating, several tasks have been needed to do operate effectively. This should lead to labor revenue.Whenever companies identify an expense as well as a speedier way to accomplish operations, they will most surely go to it. The above leaves the job to be done as well as no machinery to operate and even if the device does not operate, these same commodities are not being usedXYZ shop has a favorite model that has annual sales of 145. The cost to place an order to replenish inventory is $25 per order, and annual inventory holding cost per unit is $20. Assume the store is open 350 days per year. a. What is the optimal order size
Answer:
EOQ= 19 units
Explanation:
Giving the following information:
Demand= 145 units
Order cost= $25 per order
Holding cost= $20.
To calculate the optimal order quantity, we need to use the economic order quantity method:
Economic order quantity (EOQ)= √[(2*D*S)/H]
D= Demand in units
S= Order cost
H= Holding cost
EOQ= √[(2*145*25) / 20]
EOQ= √362.5
EOQ= 19 units
The present value of a perpetual tax shield increases as the firm's tax rate ________ and as the amount of the debt ________.
a. increases; increases
b. increases; decreases
c. decreases; decreases
d. decreases; increases
Answer:
B
Explanation:
The value of tax shield is simply given as corporate tax rate times the cost of debt times the market value of debt.
If the debt is constant and perpetual, the company’s tax shield depends only on the corporate tax rate and the value of debt. Then the present value of tax shield equals the discounted value of debt
financial lit Banks offer other types of services such as safe deposit boxes for customers to store valuable documents. List at least two other types of non-account services that the provider makes available to customers, either for a fee or at no cost.
Answer and Explanation:
Banks offer agency services too such as being trustees, executors, or financial advisors to their customers. They can also stand as guarantee for their customers.
Banks also offer reference services. They provide information on the financial position or strength of their customers for the purpose of a customer's business dealing. This is usually done confidentially and with the permission of the customer
Maxim Corp. has provided the following information about one of its products:Date Transaction Number of Units Cost per Unit1/1 Beginning Inventory 285 $ 157 6/5 Purchase 485 $ 177 11/10 Purchase 185 $ 217 During the year, Maxim sold 570 units.What is cost of goods sold using the average cost method? (Do not round intermediate computations.)
Answer:
$101,904.6
Explanation:
The computation of the cost of goods sold using the average cost method is shown below:
Beginnig Inventory 285 at $157 = $44,745
Purchases 485 at $177 = $85,845
Purchases 185 at $217 = $40,145
Total cost = $170,735
Now
Total number of units is
= 285 + 485 + 185
= 955
Now
Average Cost per unit is
= $170,735 ÷ 955
=$ 178.78
And, finally
Cost of goods Sold is
= 570 × $178.78
= $101,904.6
The firm you manage faces the following costs: Quantity Total Cost 0 $4 1 $6 2 $7 3 $10 4 $15 5 $21 What is the average fixed cost of the 2nd unit produced
Answer:
The average fixed cost of the 2nd unit produced is:
= $2.
Explanation:
a) Data and Calculations:
Quantity Total Cost Fixed Cost Average Fixed Cost
0 $4 $4 $4
1 $6 $4 $4
2 $7 $4 $2
3 $10 $4 $1.3
4 $15 $4 $1
5 $21 $4 $0.8
b) The average fixed cost (AFC) is the total fixed cost divided by the quantity of production within the relevant range. It does not change when there a change in the number of goods and services produced by a company. Average fixed cost can be calculated from the salaries of permanent employees, the mortgage payment on machinery and plant, and rent.
Jefferson Company's demand for its only product exceeds its manufacturing capacity. The company provided the following information for the machine whose limited capacity is prohibiting the company from producing and selling additional units.
Actual run time this week 5,696 minutes
Machine time available per week 6,400 minutes
Actual run rate this week 1.68 units per minute
Ideal run rate 2.00units per minute
Defect-free output this week 12,670 units
Total output this week (including defects) 18,100units
Required:
1. Compute the utilization rate. (Round your answer to 2 decimal places.)
2. Compute the efficiency rate. (Round your answer to 2 decimal places.)
3. Compute the quality rate. (Round your answer to 2 decimal places.)
4. Compute the overall equipment effectiveness (OEE). (Do not round intermediate calculations. Round your final answer to 3 decimal places.)
Answer:
1. Utilization rate = Operating time/Scheduled time
Utilization rate = 5,696/6,400
Utilization rate = 0.89
2. Efficiency rate = (Total output / Ideal run rate) / Operating time
Efficiency rate = (18,100/2) / 5,696
Efficiency rate = 9,050 / 5,696
Efficiency rate = 1.5888343
Efficiency rate = 1.59
3. Quality rate = Good units produced / Total units produced
Quality rate = 12,670 / 18,100
Quality rate = 0.70
4. Overall Equipment Effectiveness = Utilization rate * Efficiency rate * Quality rate
Overall Equipment Effectiveness = 0.89 * 1.59 * 0.70
Overall Equipment Effectiveness = 0.99057
Overall Equipment Effectiveness = 0.991
The utilization rate is 0.89 and the efficiency rate is 1.59.
From the information given, the utilization rate will be:
= Operating time/Scheduled time
= 5,696/6,400
= 0.89
The efficiency rate will be:
= (Total output / Ideal run rate) / Operating time
= (18,100/2) / 5,696
= 9,050 / 5,696
= 1.59
The quality rate will be:
= Good units produced / Total unit
= 12,670 / 18,100
= 0.70
The overall equipment effectiveness will be:
= Utilization rate × Efficiency rate × Quality rate
= 0.89 × 1.59 × 0.70
= 0.991
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A number of major corporations, such as General Motors, Amway, and Evian, sponsor or support worthy causes, many of which are environmental causes. These companies are highly motivated to engage in cause-oriented marketing because _____.
Answer:
C)corporations hope to generate goodwill toward the company and its brands
Explanation:
THESE ARE THE OPTIONS FOR THE QUESTION
a. it is a socially acceptable way of distributing excess profits
b. corporations function better in a healthy environment
c. corporations hope to generate goodwill toward the company and its brands
d. major companies are required by law to support environmentally friendly causes
e. research shows that companies that support the environment do better financially
From the question we are informed about A number of major corporations, such as General Motors, Amway, and Evian, sponsor or support worthy causes, many of which are environmental causes. In this case, These companies are highly motivated to engage in cause-oriented marketing because corporations hope to generate goodwill toward the company and its brands.
Cause marketing can be regarded as one that contains some collaboration which exist between a profit oriented business as well as a nonprofit organization all for common benefit. Cause marketing can as well be regarded as social or charitable campaigns which is been set up by for-profit oriented brands. In most cases, brands that has association with a nonprofit usually have their corporate social responsibility been boasted.
At the start of the current year, Minuteman Corporation had a credit balance in the Allowance for Doubtful Accounts of $1,800. During the year a monthly provision of 2% of sales was made for uncollectible accounts. Sales for the year were $600,000, and $5,600 of accounts receivable were written off as worthless. No recoveries of accounts previously written off were made during the year. What is the ending normal balance of t
Answer:
$8,200
Explanation:
Missing word "What is the ending normal balance of the Allowance account at year-end?"
Particulars Amount
Opening balance $1,800
Add: Monthly provision $12,000 (2%*$600,000)
Less: Bad debt $5,600
Ending balance of allowance $8,200
Which of the following statements about a partnership is correct? Group of answer choices The personal assets of a partner are included in the partnership accounting records. A partnership is not required to file an information tax return. Each partner's share of income is taxable to the partnership. A partnership represents an accounting entity for financial reporting purposes.
Answer:
do you have a picture I can help you
If a company purchases equipment costing $5,100 on credit, the effect on the accounting equation would be:
Answer:
assets increase $5,100 and liabilities increase $5,100
Explanation:
Assets are the items that a company owns which can provide future economic benefit.
Liabilities are future sacrifices of economic benefits that an entity is obliged to make to other entities as a result of past transactions or other past events, hence Liabilities are what a person or company owe other parties.
If a company purchases equipment costing $5,100 on credit, the assets of the company will increase by $5100 as a result of acquiring an equipment. Also, the liability will increase by $5100 as a result of debt owed.
A company using IFRS to prepare its financial statements will use a hierarchy to determine what recognition, valuation, and disclosure requirements should be used.
1. IFRS, IAS, IFRS Interpretations
2. Pronouncements of other standard-setting bodies
3. The Conceptual Framework for Financial Reporting
Which of the following depicts the correct order of the hierarchy?
a. 2,3,1
b. 3,2,1
c. 1.2.3
d. 1,3,2
Answer:
The hierarchy for determining recognition, valuation, and disclosure requirements for IFRS is:
d. 1,3,2
Explanation:
1. IFRS, IAS, IFRS Interpretations are the main standards issued by the IASB, the international accounting standard-setting body. It is like the FASB that sets the US GAAP.
2. Pronouncements of other standard-setting bodies can be applied where IFRS are not definitive.
3. The Conceptual Framework for Financial Reporting help the IASB to develop and revise IFRS that are based on consistent concepts.
The most recent financial statements for Summer Tyme, Inc., are shown here:
Income Statement Balance Sheet
Sales $3,700 Current assets $4,500 Current liabilities $960 Costs 2,400 Fixed assets 5,200 Long-term debt 3,620 Taxable income $1,300 Equity 5,120 Taxes (21%) 273 Total $9,700 Total $9,700 Net income $1,027
Assets, costs, and current liabilities are proportional to sales. Long-term debt and equity are not. The company maintains a constant 60 percent dividend payout ratio. As with every other firm in its industry, next year's sales are projected to increase by exactly 30 percent.
Required:
What is the external financing needed? (Do not round your intermediate calculations.)
EFN = needed new long-term debt and/or external equity
Answer:
External finance needed = $2,088
Explanation:
Note: See the attached excel file for the Calculation of ratios with respect to sales, Proforma Income Statement, Calculation of Retained Earnings and Equity, and Proforma Balance Sheet.
From the Proforma Balance Sheet in the attached excel file, we have:
Total Assets = $12,610
Total Liabilities = $10,448
Therefore, we have:
External finance needed = Total Assets - Total Liabilities = = $12,610 - $10,448 = $2,088
Baylor Service Corp. redeemed $1,000 of gift cards that customers used to pay for services that were performed by the company. The related adjusting entry would include a debit to: A. Accounts Receivable and a credit to Service Revenue. B. Unearned Revenue and a credit to Service Revenue. C. Cash and a credit to Service Revenue. D. Cash and a credit to Unearned Revenue.
Answer:
B. Unearned Revenue and a credit to Service Revenue.
Explanation:
The adjusting entry is given below:
Unearned revenue $1,000
To Service revenue $1,000
(Being service revenue is recorded)
Here unearned revenue is debited as it decreased the liabilities and credited the service revenue as it increased the revenue
Therefore the option b is correct
You are planning to save for retirement over the next 25 years. To do this, you will invest $1,000 a month in a stock account and $700 a month in a bond account. The return of the stock account is expected to be 9 percent, and the bond account will pay 6 percent. When you retire, you will combine your money into an account with a return of 7 percent. How much can you withdraw each month from your account assuming a 20-year withdrawal period
Answer:
Monthly withdraw= $12,452.6
Explanation:
First, we need to calculate the total accumulated at the moment of retirement. We will use the following formula:
FV= {A*[(1+i)^n-1]}/i
A= monthly deposit
Stock:
Monthly investment= $1,000
Interest rate= 0.09/12= 0.0075
Number of periods= 25*12= 300 months
FV= {1,000*[(1.0075^300) - 1]} / 0.0075
FV= $1,121,121.94
Bond:
Monthly investment= $700
Interest rate= 0.06/12= 0.005
Number of periods= 25*12= 300 months
FV= {700*[(1.005^300) - 1]} / 0.005
FV= 485,095.77
Total FV= 1,121,121.94 + 485,095.77
Total FV= $1,606,217.71
Now, the annual withdrawal:
Interest rate= 0.07/12= 0.005833
Number of months= 12*20= 240
Monthly withdraw= (FV*i) / [1 - (1+i)^(-n)]
Monthly withdraw= (1,606,217.71*0.005833) / [1 - (1.005833^-240)]
Monthly withdraw= $12,452.6
Explain whether each of the following statements is true or false.
The marginal rate of substitution (MRS) diminishes as an individual moves downward along the demand curve. Assume the statement refers to good X with price Upper P Subscript Upper X , where good X is measured on the horizontal axis of an indifference map and good Y is measured on the vertical axis.
Answer:
1. True
Explanation:
Marginal rate of substitution is quantity of good which a consumer will need to have in order to leave another good. The MRS equals to Px/Py. This will decrease when the demand curve decreases.
Summer 20 Corp estimates overhead based on direct labor hours and has given you the following information:
Estimated Manufacturing Overhead Costs 2020 $405,000
Estimated Direct Labor Hours for 2020 220,000
Actual Direct Labor Hours for 2020 202,000
Manufacturing Overhead Account Debit Entries total $380,000
1. Determine the predetermined overhead allocation rate stated with cents.
2. Determine the amount of manufacturing overhead that was allocated.
3. Calculate the amount Summer 20 Corp is over or under allocated during the year.
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= 405,000 / 220,000
Predetermined manufacturing overhead rate= $1.841 per DLH
Now, we can allocate overhead:
Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base
Allocated MOH= 1.841*202,000
Allocated MOH= $371,882
Finally, the over/under allocation:
Under/over applied overhead= real overhead - allocated overhead
Under/over applied overhead= 380,000 - 371,882
Underapplied overhead= $8,118
