Answer:
B. Market Value Method
Explanation:
First, it should be noted that Joint Product costing method allocates joint costs based on the the value of sales per time. Furthermore, Joint costs ratio to the value of sales remains the same for all the products that are evaluated based on the method. When we talk of value of sales, we are automatically referring to the value at which the market receives the product or buys the product so this is market value method.
The implication of this, is that the gross profit percentage used for all the products undert this costing method will be the same. oint product costing method.
This costing method is usually employed by a business when maunfacturing process of the production process of goods is such that there is a stage where products are split off for different reasons. The production costs or manufacturing costs before the split of must be allocated threfore, a costing method (Joint Product Costing Method or Market Value Method) is assigned.
Answer:
D
Explanation:
A good has negative externality if the costs to third parties not involved in production is greater than the benefits. an example of an activity that generates negative externality is pollution. Pollution can be generated at little or no cost, so they are usually overproduced. Government can discourage the production of activities that generate negative externality by taxation. Taxation increases the cost of production and therefore discourages overproduction. Tax levied on externality is known as Pigouvian tax.
Government can regulate the amount of externality produced by placing an upper limit on the amount of negative externality permissible
A good has positive externality if the benefits to third parties not involved in production is greater than the cost. an example of an activity that generates positive externality is research and development. Due to the high cost of R & D, they are usually under-produced. Government can encourage the production of activities that generate positive externality by granting subsidies.
A public good is a good that is non excludable and non rivalrous. An example of a public good is a statue in a public park Everyone has assess to the statue and because one person is enjoying the view of the statue does not means another person cannot enjoy the view of the statue
Answer:
Unitary cost= $167.35
Explanation:
Giving the following information:
The company based its predetermined overhead rate for the current year on total fixed manufacturing overhead cost of $481,900, variable manufacturing overhead of $3.00 per machine-hour, and 79,000 machine-hours.
Job A496:
Number of units in the job 20
Total machine-hours 80
Direct materials $ 870
Direct labor cost $1,740
First, we need to calculate the estimated manufacturing overhead rate we need to use the following formula:
Estimated manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Estimated manufacturing overhead rate= (481,900/79,000) + 3= $9.1 per machine hour
Now, we need to calculate the total cost per unit:
Unitary cost= direct material + direct labor + allocated overhead
Unitary cost= (879/20) + (1,740/20) + (80*9.1)/20= $167.35
Answer:
Option (B) is correct.
Explanation:
Given that,
Lot size = 600
Average demand per week = 100 units
Lead time = 4 weeks
Cycle inventory is determined by dividing the lot size by 2. It is calculated as follows:
= Lot size ÷ 2
= 600 ÷ 2
= 300 units
Pipeline inventories is determined by the product of average demand and lead time from plant to wholesaler.
Pipeline inventories:
= Average demand × Lead time
= 100 × 4
= 400 units
Hence, Total cycle + Pipeline inventories = 300 units + 400 units
= 700 units
Now, if the plant reduces its lead time from 4 to 2 weeks and lot size remains the same, then
Cycle inventory:
= Lot size ÷ 2
= 600 ÷ 2
= 300 units
Pipeline inventories:
= Average demand × Lead time
= 100 × 2
= 200 units
Hence, New Total cycle + Pipeline inventories = 300 units + 200 units
= 500 units
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