XYZ Corporation manufactures air conditioners and has the capacity to manufacture and sell 80,000 units each year. It is currently only manufacturing and selling 60,000 units. The following per unit numbers relate to annual operations at 60,000 units: Per Unit Selling price $ 125 Manufacturing costs: Variable $ 25 Fixed $ 40 Selling and administrative costs: Variable $ 10 Fixed $ 15 A customer would like to purchase 3,000 air conditioners from XYZ but only if they can get them for $75 each. Variable selling and administrative costs on this special order will drop down to $2 per unit. This special order will not affect the 60,000 regular sales and it will not affect the total fixed costs. The annual financial advantage (disadvantage) for the company as a result of accepting this special order from this customer should be:

Answers

Answer 1

Answer:

The annual financial advantage is $147000

Explanation:


Related Questions

15. Ilang lalawigan ang bumubuo sa Gitnang Mindanao?​

Answers

Answer:

6 region any meron SA mindanao

The model of competitive markets relies on these three core assumptions:
1. There must be many buyers and sellers-a few players can't dominate the market.
2. Firms must produce an identical product-buyers must regard all sellers' products as equivalent.
3. Firms and resources must be fully mobile, allowing for free entry into and exit from the industry.
The first two conditions imply that all consumers and firms are price takers. While the third is not necessary for price-taking behavior, assume for this problem that a market cannot maintain competition in the long run without free entry.
Identify whether or not each of the following scenarios describes a competitive market, along with the correct explanation of why or why not.
Scenario Competitive
1. Several stores in the mall sell hooded sweatshirts. Each store's sweatshirts reflect the style of that particular store. Additionally, some stores use higher-quality cotton than others, which is reflected in the apparel's prices.
2. In a small town, there are two providers of broadband Internet access: a cable company and the phone company.
The Internet access offered by both providers is of the same speed.
3. There are hundreds of high school students in need of algebra tutoring services in Dallas.
4. Dozens of companies offer tutoring services, and the parents who seek out tutors view the quality of the tutoring at the different companies to be largely the same.
5. The government has granted a patent to a pharmaceutical company for an experimental AIDS drug. That company is the only firm permitted to sell the drug.

Answers

Answer:

Following are the solution to the given points:

Explanation:

For point 1:

No, not the same thing Because the product is not the same, the marketplace is monopolistic and not completely competitive.

For point 2:

No, not a bunch of salespeople Because the product is the same any maker wishes to enter into the market, the competitive market also does not mean that only two vendors and not so many sellers present in the market.

For point 3 and 4:

Yes, it is aggressive algebra upon on market Same students and several teaching qualities everywhere.

For point 5:

No, no free admissionm, it was not a regulated business. The rationale would be that the entrance to the market via patent rights is restrained by the state.

Lupo Corporation uses a job-order costing system with a single plantwide predetermined overhead rate based on machine-hours. The company based its predetermined overhead rate for the current year on the following data:
Total machine-hours
Total fixed manufacturing overhead cost
Variable manufacturing overhead per machine-hour 31,400 $219,800 4
Recently. Job T687 was completed with the following characteristics:
Number of units in the job 10
Total machine-hours
Direct materials
Direct labor cost $ 580 $1,160
The total job cost for Job T687 is closest to: (Round your intermediate calculation to 2 decimal places)

Answers

Answer:

$1960

Explanation:

The computation of the total cost is shown below:

Total variable overhead estimated is

= (4 × 31400)

= $125600

Now

total overhead estimated is

= Total variable overhead estimated + Total fixed overhead estimated

= $125600 + 219800

= $345400

Now predetermined overhead rate is

= $345400 ÷ 31400

= $11 per machine hour

Now total overhead applied is

= (11 × 20)

= $220

So,  total job cost is

= Direct material + Direct labor + Total overhead

= (580+1160+220)

 = $1960

The following cost data relate to the manufacturing activities of Chang Company during the just completed year: Manufacturing overhead costs incurred: Indirect materials $ 17,000 Indirect labor 150,000 Property taxes, factory 10,000 Utilities, factory 90,000 Depreciation, factory 147,000 Insurance, factory 12,000 Total actual manufacturing overhead costs incurred $ 426,000 Other costs incurred: Purchases of raw materials (both direct and indirect) $ 420,000 Direct labor cost $ 80,000 Inventories: Raw materials, beginning $ 22,000 Raw materials, ending $ 32,000 Work in process, beginning $ 42,000 Work in process, ending $ 72,000 The company uses a predetermined overhead rate of $20 per machine-hour to apply overhead cost to jobs. A total of 21,700 machine-hours were used during the year. Required: 1. Compute the amount of underapplied or overapplied overhead cost for the year. 2. Prepare a schedule of cost of goods manufactured for the year.

Answers

Answer:

Part 1

under-applied overheads = $8,000

Part 2

Schedule of cost of goods manufactured for the year.

Opening Work in process                                            $ 42,000

Add Direct Materials                                                   $393,000

Add Direct Labor                                                          $ 80,000

Add Applied Overheads                                             $434,000

Less Ending Work In Process                                    ( $ 72,000)

Cost of Goods Manufactured                                     $877,000

Explanation:

The amount of underapplied or overapplied overhead cost for the year.

Applied Overheads = Predetermined overheads rate x Actual machine hours

                                 = $20 x 21,700 machine-hours

                                 = $434,000

Since,

actual manufacturing overhead costs = $ 426,000

and

applied manufacturing overhead = $434,000

then

under-applied overheads = $8,000 ($434,000 - $ 426,000)

Schedule of cost of goods manufactured for the year.

Opening Work in process                                            $ 42,000

Add Direct Materials ($ 22 + $ 420 - $ 32 - $ 17)      $393,000

Add Direct Labor                                                          $ 80,000

Add Applied Overheads                                             $434,000

Less Ending Work In Process                                    ( $ 72,000)

Cost of Goods Manufactured                                     $877,000

A court may pierce an LLC's veil if a.members treat the LLC like a separate organization. b.members keep their assests and the assets of the LLC separate. c.the LLC has too many members. d.members fail to provide adequate capital.

Answers

Answer:

d.members fail to provide adequate capital.

Explanation:

In the case when the court might have pierce an LLC veil so in that case the members could fail in order to give the enough capital as neither it is treated as the separate organization, nor its assets could keep as separate and also it has not so much members

So as per the given situation, the option d is correct

Determine whether each of the following accounting duties mainly involves financial accounting, managerial accounting, or tax accounting.

1. Consulting with treasurer on cash flows
2. Intemal auditing
3. Estate planning
4. External auditing
5. Tax consulting
6. Analyzing extema financial reports
7. Planning transactions to minimize taxes
8. Enforcing tax laws Financial accounting Tax accounting

Answers

Answer:

Explanation:

1. managerial

2, managerial

3. financial

4. financial

5. tax

6. financial

7. tax

8. tax

The classification of the following accounting duties related to financial accounting, managerial accounting, or tax accounting is as follows:

Consulted with the treasurer for the cash flows should be the managerial accounting as it is the management part.Internal auditing is managerial accounting.Estate planning is related to tax so it is a tax accounting.External auditing is classified as financial accounting.Tax consulting is related to tax so it is a tax accounting.External Financial reports should be analyzed so it is a financial accounting.For minimizing the taxes, tax accounting should be used.For enforcing the tax laws, tax accounting should be used.

In this, the following transactions should be classfied.

Learn more about the accounting here: brainly.com/question/19436415

A car dealer acquires a used car for $14,000, with terms FOB shipping point. Compute total inventory costs assigned to the used car if additional costs include
$250 for transportation-in.
$300 for shipping insurance.
$900 for car import duties.
$150 for advertising.
$1,250 for sales staff salaries.
$180 for trimming shrubs.
For computing inventory, what cost is assigned to the used car? Included in Inventory Cost Expensed as incurred Cost 14.000 900 Cost Transportation in Import duties Insurance during shipment Advertising Sales staff salaries 300 150 1,250 16.850S 0 $

Answers

Answer: $15,450

Explanation:

The inventory cost of the car is every cost that was incurred to get it to the car dealer and ready for sale.

Total inventory cost assigned is:

= Cost of car + transportation-in + shipping insurance + car import duties

= 14,000 + 250 + 300 + 900

= $15,450

A corporation sold 11,000 shares of its $10 par value common stock at a cash price of $14 per share. The entry to record this transaction would include:___________

Answers

Answer:

A credit to Common Stock for $110,000. A further explanation is provided below.

Explanation:

Given:

Corporation sold,

= 11,000

Common stock per value,

= $10

Cash price,

= $14 per share

The entry record would include,

= [tex]Sold \ corporation\times Common \ stock[/tex]

= [tex]11000\times 10[/tex]

= [tex]110,000[/tex] ($)

Which type of budgeting requests for investment in large assets such as buildings, renovations, software systems and furniture

Answers

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The type of budgeting requests for investment in large assets is buildings.

An investment property is real estate property purchased with the intention of earning a return on the investment either through rental income, the future resale of the property, or both.

Why do people invest in buildings?

Key Takeaways. Real estate investors make money through rental income, appreciation, and profits generated by business activities that depend on the property. The benefits of investing in real estate include passive income, stable cash flow, tax advantages, diversification, and leverage.

Apartment buildings frequently get sold on the basis of their cap rate, which is effectively a multiple of the income they produce. If you increase your building's income by raising rents or cutting expenses, you should be able to sell for a profit.

To learn more about investment in buildings, refer

https://brainly.com/question/11791499

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Use the following information to answer questions Skip to question [The following information applies to the questions displayed below.] The following information is available for Lock-Tite Company, which produces special-order security products and uses a job order costing system. April 30 May 31 Inventories Raw materials $ 43,000 $ 52,000 Work in process 10,200 21,300 Finished goods 63,000 35,600 Activities and information for May Raw materials purchases (paid with cash) 210,000 Factory payroll (paid with cash) 345,000 Factory overhead Indirect materials 15,000 Indirect labor 80,000 Other overhead costs 120,000 Sales (received in cash) 1,400,000 Predetermined overhead rate based on direct labor cost 70 %

Answers

Answer:

Missing word "a. Direct labor usage. b. Indirect labor usage. c. Total payroll paid in cash.  Prepare journal entries for the above transactions for the month of May"

S/n    General Journal                           Debit         Credit

a        Work in Process inventory       $265,000

         ($345,000 - $80,000)

                 Factory wages payable                        $265,000

          (To record for Direct labor usage)

b        Factory overhead                      $80,000

                 Factory wages payable                        $80,000

         (To record for Indirect labor usage)

c        Factory wages payable             $345,000

                Cash                                                        $345,000

         (To record for Total payroll paid in cash)

The partners share profits and losses in the ratio of 5:3:2, respectively. The partners agreed to dissolve the partnership after selling the other assets for $50,000. On dissolution of the partnership, Janet should receive:

Answers

Answer:

$30,000

Explanation:

The computation of the amount received by Janet is given below:

Loss on sale of other assets is

= $150,000 - $50,000

= $100,000

Share of Janet in loss is

= $100,000 × 5 ÷ 10

= $50,000

So,  

Janet revised capital balance is

= $80,000 - $50,000

= $30,000

Bellevue Company has 26,000 units of inventory on hand at December 31. It sold 1,950 units which are in transit and were shipped FOB destination. Bellevue purchased 3,250 units which were shipped FOB shipping point by the seller and are still in transit. What is the total amount of inventory to which Bellevue has legal title at December 31

Answers

Answer:

24050

Explanation:

Calculation to determine the total amount of inventory to which Bellevue has legal title at December 31

Using this formula

Inventory=Inventory on hand at December 31- Units in Transit

Let plug in the formula

Inventory=26,000 units- 1,950 units

Inventory=24050

Therefore the total amount of inventory to which Bellevue has legal title at December 31 is 24050

Amortization.  Loan Consolidated Incorporated​ (LCI) is offering a special​ one-time package to reduce Custom​ Autos' outstanding bills to one​ easy-to-handle payment plan. LCI will pay off the current outstanding bills of ​$242 comma 000 for Custom Autos if Custom Autos will make an annual payment to LCI at an interest rtae of 9 ​% over the next 5 years.   a.  What are the annual payments of the​ loan? b.  What is the amortization schedule for this loan if Custom Autos wants to pay off the loan before the loan maturity in 5 ​years? c.  When will the balance be half paid​ off?   d.  What is the total interest expense on the loan over the 5 ​years?

Answers

Answer:

Please find the complete question in the attached file.

Explanation:

Use PMT for the interest amount computation

[tex]PMT(12\%, 55, 232000, 0 , 0) = \$27,894.77[/tex]

At first, the bulk of an initial premium is paid at the rate of interest, and that only the remainder of the small part is used for  amortization. The very first three years schedule is shown below:

[tex]Loan\ \ \ \ \ \ \ \ \ \ Annual\ \ \ \ \ \ \ \ \ \ Interest\ \ \ \ \ \ \ \ \ \ Principal\\\\[/tex]

[tex]1\ \ \ \ \ \ \ \ \$232,000.00\ \ \ \ \ \ \ \ \$27,894.77\ \ \ \ \ \ \ \ \$27,840.00\ \ \ \ \ \ \ \ \$54.77\\\\2\ \ \ \ \ \ \ \ \$231,945.23\ \ \ \ \ \ \ \ \$27,894.77\ \ \ \ \ \ \ \ \$27,833.43\ \ \ \ \ \ \ \ \$61.34\\\\3\ \ \ \ \ \ \ \ \$231,883.89 \ \ \ \ \ \ \ \ \$27,894.77\ \ \ \ \ \ \ \ \$27,826.07\ \ \ \ \ \ \ \ \$68.70\\\\[/tex]

By the 49th payment, upwards of half of the initial amount borrowed would be the total principal paid. Using the formula CUMPRINC in excel, the entire principal payment is calculated twice.

Total Interest Expense [tex]= 27,894.77 \times 55 - 232,000 = \$1,302,212.27[/tex]

The following revenue and expense account balances were taken from the ledger of Acorn Health Services Co. after the accounts had been adjusted on January 31, 20Y7, the end of the fiscal year:

Depreciation Expense $10,000
Insurance Expense 9,000
Miscellaneous Expense 8,150
Rent Expense 60,000
Service Revenue 634,900
Supplies Expense 4,100
Utilities Expense 44,700
Wages Expense 548,200

Requierd:
Prepare an income statement.

Answers

Answer and Explanation:

The preparation of the income statement is presented below:

Service revenue $634,900

Less:

Depreciation Expense $10,000

Insurance Expense 9,000

Miscellaneous Expense 8,150

Rent Expense 60,000

Supplies Expense 4,100

Utilities Expense 44,700

Wages Expense 548,200

Net loss -$49,250

Ayayai Corp. reported net income of $87300 for the year. During the year, accounts receivable increased by $5820, accounts payable decreased by $3880 and depreciation expense of $9700 was recorded. Net cash provided by operating activities for the year is

Answers

Answer: $87,300

Explanation:

Net cash provided by operating activities are those that are generated from the operations of the company.

The calculation is:

= Net income + Depreciation - Accounts receivable increase - accounts receivable decrease

= 87,300 + 9,700 - 5,820 - 3,880

= $87,300

what does the "S" represent for the designation GMAW-S?
A. Spray Transfer
B. Pulsed Spray
C. Solid wire
D. Short Circuit Transfer
Help me bro​

Answers

Answer:

C. Solid wire

Explanation:

HOPE IT' HELP YOU

For each of the following products and services, indicate whether it is more likely produced in a process operation or in a job order operation.

1. Beach towels
2. Bolts and nuts
3. Lawn chairs
4. Headphones
5. Designed patio

Answers

Answer:

Process operations are for when there are multiple goods to be produced. These products normally have the same specifications so can be mass produced.

This is different from Job order operation which is used when a single good is product. It is usually used for customized goods.

Process operations:

Beach towels Bolts and nuts Lawn chairs Headphones

Job Order operation

Designed patio.

Calculating the Cost of Equity. Suppose stock in Lululemon Corporation has a beta of 0.80. The market risk premium is 10 percent and the risk-free rate is 2 percent. What is Lululemon's cost of equity capital?
Calculating the WACC. In addition to the information in the previous problem, suppose Boone has a target debt-equity ratio of 50 percent. Its cost of debt is 8 percent, before taxes. If the tax rate is 34 percent, what is the WACC?

Answers

Answer:

Cost of equity capital can be found by the Capital asset pricing model:

Cost of capital

= Risk free rate + beta * market premium

= 2% + 0.8 * 10%

= 10%

Weighted Average Cost of Capital:

= (weight of debt * after tax cost of debt) + (weight of stock * cost of stock)

= (50% * 8% * ( 1 - 34%)) + (50% * 10%)

= 10.28%

You are considering a stock that is expected to pay dividends during the next five years of $0.50, $0,52, $0,54, $0,56 and $0.58. You estimate that you can sell the stock for $100 at the end of five years. Your required rate of return is 15% and the stock is currently selling for $65. If you purchase the stock, what rate of return do you expect to earn

Answers

Answer:

9.7%

Explanation:

The rate of return can be determined using a financial calculator

Cash flow in year 0 = -65

Cash flow in year 1 = $0.50

Cash flow in year 2 = $0.52

Cash flow in year 3 = $0.54

Cash flow in year 4 = $0.56

Cash flow in year 5 = $0.58 + $100

Rate of return = 9.7%

To find the rate of return using a financial calculator:

1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.

2. After inputting all the cash flows, press the IRR button and then press the compute button.  

Sandhill Co. Bonita Industries Net cash provided by operating activities $ 81,330 $91,400 Average current liabilities 49,800 94,900 Net income 181,900 181,900 Capital expenditures 37,660 69,250 Dividends paid 4,570 9,920Compute free cash flow for both companies and compare. (Show a negative free cash flow with either a-sign e.g.-15,000 or in parenthesis e.g. (15,000).) Bonita Industries Windsor Inc. Free cash flow $ $ v 's free cash flow is better.

Answers

Answer:

Free cash flow = Net cash flow from operating activities - Capital expenditures - Dividends paid

Sandhill free cash flow  

= 81,330 - 37,660 - 4,570

= $39,100

Bonita industries

= 91,400 - 69,250 - 9,920

= $12,230

Sandhill Free cash flow is better.

Find the average payment period if accounts payable is $20,000, cost of goods sold is $200,000, and sales are $500,000.

Answers

Answer:

36.5

Explanation:

Account payable = $20,000

The cost of goods sold is $200,000

Sales are $500,000

The average payment period can be calculated as follows

= 20,000/200,000/365

°= 20,000/547.9

36.5

Henbe the average payment period is 36.5

Assume tuition at the University of Virginia cost $2,962 (per semester) in 2004 and $11,584 in 2012. If the price index was 184 in 2004 and 226 in 2012, then we could say tuition has increased more slowly than inflation. tuition has increased much more rapidly than inflation. tuition has increased at about the same rate as inflation. nominal tuition has increased. tuition suffers from menu costs due to inflation.

Answers

Answer:

tuition has increased much more rapidly than inflation.

Explanation:

2.6

18.6

Sandy purchased a new dress through Zappos. When it arrived, she opened the package and saw that the dress had very small cap sleeves. Slightly annoyed that they dress did not look like the photo on the website, she tried the dress on only to realize that it was too short for her. She regretted buying this dress. Luckily for her, Zappos included an easy return label for free return shipping and a comment card where she could indicate why she was returning the purchase. Zappos made it easy for Sandy to address her cognitive dissonance by focusing on processes for which area of the consumer decision-making process?
a. evaluating alternatives process.
b. postpurchase process.
c. making the purchase process.

Answers

Answer:

Option b: Post purchase process

Explanation:

There are several reasons or outcomes of post-purchase processes/evaluation of a product by consumers. They includes:

1. Post-purchase dissonance

2. Regret

3. Satisfaction/dissatisfaction

Post-purchase dissonance

This is simply known as a well-known feeling of anxiety over if the correct purchase decision was made concerning a product or services. It is said to occur when there is more than one alternative that is attractive thereby making the decision process important.

Post-purchase regret

This is simply regarded as a feeling that a wrong purchase decision has been made concerning a particular product or services. It is said to occur when one cannot reverse the decision and have experienced a negative outcome from the decision made.

product satisfaction.

This is said to exist when the consumer makes a positive evaluation and feels happy with their decision made concerning a particular product purchased.

Explain the three system inhibitors of waste, variability and inflexibility and how they can be inefficient to corporations.

Answers

Answer and Explanation:

Waste occurs when a company uses inputs that do not add value to their customers. In other words, something customers are not willing to pay for is classified as waste to the company.

Variability is predictability or unpredictability as regards the products of the company. This is what customers expect the products of the company to be like everytime they buy, a certain standard. Example when a customer buys food from a restaurant and expects it to taste the same everytime.

Inflexibility or rigidity occurs when a company isn't flexible enough to adapt easily to customer's expectations such as product mix, changes in demand of their products etc.

These three inhibitors if not handled properly will lead to bad resource management causing customer and employee dissatisfaction.

__________aggregate customers' opinions related to products or services that they have purchased and then suggest them to others with the same interest.

Answers

Answer:

Recommendation websites

Explanation:

Recommendation websites aggregate customers' opinions related to products or services that they have purchased and then suggest them to others with the same interest.

These websites make use of customer data based on what they have purchased in the past (product or service) to present to them new/similar products.

Your best friend has an idea for a drive-through bar. Indicate the best explanation for why others have not taken advantage of her idea.
A. Unprofitable.
B. Government intervention.
C. True innovation.
D. Market failure.

Answers

Answer: B. Government intervention.

Explanation:

A Drive-through bar could be very profitable as it involves people simply pulling up to a window, ordering alcohol and driving away with it. It is not very workable though because it is dangerous.

Drinking and driving is one of the highest causes of road accidents and a drive-through bar is literally encouraging people to do that. The government has therefore intervened by enacting laws to limit the trading of liquor in such ways so as to reduce the instance of road accident.

Wealth Company has the following transactions for the month of November: Purchased materials on account for $300,000 Materials requisitioned for $75,000 Direct labor for the month was incurred (but not yet paid) of $50,000. Actual overhead for the month was $30,000. It has not been paid yet. (Charge to various payables.) Overhead is applied to production at the rate of 50% of direct labor. Jobs totaling $50,000 were transferred from Work-in-Process to Finished Goods. Jobs costing $34,000 were sold. Balances at the beginning of the month were: Materials $34,240 Work-in-Process 0 Finished Goods $12,000 What is the ending balance of Finished Goods

Answers

Answer:

Wealth Company

The ending balance of Finished Goods is:

= $28,000

Explanation:

a) Data and Calculations:

Raw materials $300,000 Accounts Payable $300,000

Work in Process $75,000 Raw materials $75,000

Work in Process $50,000 Payroll Payable $50,000

Manufacturing overhead $30,000 Overhead Payable $30,000

Work in Process $25,000 Manufacturing Overhead $25,000

Finished Goods $50,000 Work-in-Process $50,000

Cost of goods sold $34,000 Finished Goods $34,000

Balances at the beginning of the month were:

Materials $34,240

Work-in-Process 0

Finished Goods $12,000

Finished Goods $12,000

Work in process 50,000

Cost of goods   (34,000)

Ending balance $28,000

Vipsana's Gyro House sells gyros. The cost of ingredients (pita, meat, spices, etc.) to make a gyro is $2.00. Vipsana pays her employees $60 per day. She also incurs a rent of $20 per day. Calculate Vipsana's variable cost per day when she produces 50 gyros using two workers?
A) $100
B) $124.40
C) $220
D) $240
Calculate Vipsana's total cost per day when she produces 50 gyros using two workers?
A) $100
B) $124.40
C) $220
D) $240
Calculate Vipsana's average fixed cost per day when she produces 50 gyros using two workers?
A) $2.00
B) $2.40
C) $0.40
D) $6.80
What is Vipsana's total cost per day when she does not produce any gyros and does not hire any workers?
A) $0
B) $2
C) $60
D) $20

Answers

Answer:

C

D

C

D

Explanation:

Fixed costs are costs that do not vary with output. e,g, rent, mortgage payments

If production is zero or if production is a million, Mortgage payments do not change - it remains the same no matter the level of output.  

Hourly wage costs and payments for production inputs are variable costs

Variable costs are costs that vary with production

If a producer decides not to produce any output, there would be no need to hire labour and thus no need to pay hourly wages.  

Variable cost per day = 2 x employees pay + (cost of ingredients x 50)

(60 x 2) + (50 x 2)

120 + 100 = 220

Total cost per day = fixed cost + variable cost per day

220 + 20 = 240

Average fixed cost per day = total fixed cost per day / 50

20 / 50 = $0.40

Vipsana's total cost per day when she does not produce any gyros and does not hire any workers is the cost of rent. Rent is a fixed cost. The firm would still have to pay rent even if its output it zero

The management of Wheeler Company has decided to develop cost formulas for its major overhead activities. Wheeler uses a highly automated manufacturing process, and power costs are a significant manufacturing cost. Cost analysts have decided that power costs are mixed; thus, they must be broken into their fixed and variable elements so that the cost behavior of the power usage activity can be properly described. Machine hours have been selected as the activity driver for power costs. The following data for the past eight quarters have been collected:

Quarter Machine Hours Power Cost
1 20,000 $26,000
2 25,000 $38,000
3 30,000 $42,500
4 22,000 $37,000
5 21,000 $34,000
6 18,000 $29,000
7 24,000 $36,000
8 28,000 $40,000

Using the high and low points (i.e., the high-low method), compute a power cost formula. (Note: Round variable rate to three decimal places.)

Total power cost = $_______ + ( $________ x Number of machine hours )

Answers

Answer:

Total power cost= 1,250 + 1.375 * number of machine hours

Explanation:

Giving the following information:

Quarter Machine Hours Power Cost

1 20,000 $26,000

2 25,000 $38,000

3 30,000 $42,500

4 22,000 $37,000

5 21,000 $34,000

6 18,000 $29,000

7 24,000 $36,000

8 28,000 $40,000

To calculate the variable and fixed costs, we need to use the following formula:

Variable cost per unit= (Highest activity cost - Lowest activity cost)/ (Highest activity units - Lowest activity units)

Variable cost per unit= (42,500 - 26,000) - (30,000 - 18,000)

Variable cost per unit= $1.375

Fixed costs= Highest activity cost - (Variable cost per unit * HAU)

Fixed costs= 42,500 - (1.375*30,000)

Fixed costs= 1,250

Fixed costs= LAC - (Variable cost per unit* LAU)

Fixed costs= 26,000 - (1.375*18,000)

Fixed costs= 1,250

A company using the FIFO method had beginning work in process inventory of 10,000 units and completed 75,000 units. They also had 5,000 units in ending work in process inventory. The number of units started and completed equals_________

Answers

Answer:

the number of units started and completed is 65,000 units

Explanation:

The computation of the number of units started and completed is given below:

= Units completed - beginning work in process inventory units

= 75,000 units - 10,000 units

= 65,000 units

Hence, the number of units started and completed is 65,000 units

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