Answer:
CRS would not benefit from dropping Donnelly’s Pizza because it would lose $43,680 in revenues and save $43,344 in costs resulting in a $336 decrease in operating income.
Explanation:
Difference: Incremental(Loss in Revenues)and Savings in Costs from dropping Donnelly’s Pizza:
Revenues $(43,680)
Cost of goods sold 26,180
Order processing ($14,000 – 10% × $14,000)= 12,600
Delivery ($3,500 – 20% × $3,500)= 2,800
Rush orders 924
Sales calls 840
Total costs 43,444
Effect on operating income (loss)
$(336)
Answer: See explanation
Explanation:
a. Calculate the predetermined overhead rate Overhead Rate per hour
Predetermined Overhead rate will be the estimated total manufacturing overhead divided by the estimated total direct labor hours. This will be:
= $ 921,600/51,200
= $ 18
(b) Calculate how much manufacturing overhead will be applied to production
Manufacturing overhead that'll be applied to production will be the predetermined overhead rate multiplied by the actual total direct labor hours. This will be:
= $ 18 × 48,900 direct labor hours
= $ 880,200
(c) Is overhead over- or underapplied? By how much?
The Actual Overhead Incurred = $902,900 while the manufacturing overhead applied = $880,200. This shows that overhead is underapplied due to the fact that manufacturing overhead applied is less than the actual overhead that is incurred.
Therefore, the amount of overhead that was underapplied will be:
= $ 902,900 - $ 880,200
= $ 22,700
(d) What account should be adjusted for over-or underapplied overhead? Should the balance be increased or decreased?
Based on the scenario in the question and the answers calculated, the cost of goods sold should be increased.
I’m pretty sure it’s that the market for complementary goods increase
Answer:
Option B
Explanation:
Option B:
Prevent a company from becoming overly focused on the near term and losing sight of larger trends and opportunities.
