Answer:
Overhead= $3,212
Explanation:
Giving the following information:
Sigma Corporation applies overhead costs to jobs based on direct labor cost.
Job W, which is still in process at year-end, shows charges of $2,700 for direct materials and $4,400 for direct labor.
Job V:
$6,300 for direct materials.
$8,500 for direct labor.
$6,205 for overhead on its job cost sheet.
First, we need to calculate the overhead rate.
Overhead rate= 6205/8500= $0.73 per direct labor dollar
Job W:
Direct labor= 4,400
Overhead= 4,400*0.73= $3,212
Answer:
a. $72,000
b. $0.36
c. $6,480
Explanation:
a. Depreciation cost = Cost of truck - Residual value
= $80,000 - $8,000
= $72,000
b. The depreciation rate = (Cost of truck - Residual value) ÷ Estimated total production
= ($80,000 - $8,000) ÷ 200,000 miles
= $72,000 ÷ 200,000 miles
= $0.36
c. The units-of-activity depreciation for the year per mile = Driven miles × Depreciation rate
= 18,000 × $0.36
= $6,480
Usually to support a cause for a good reason hope this helps!
Answer: 1. 18 times
2. Park is in better position
Explanation:
1. Times interest earned is a financial ratio that measures interest coverage. It's essentially to check if a company can pay it's debt payments and is calculated by either EBIT or EBITDA divided by the total interest expense. The higher the better and anything above 2.5 times is usually considered.
Calculating would therefore be,
= $6,120,000 /$340,000
= 18 times.
2. As mentioned in the first answer, for the Times interest earned, the higher it is, the more favourable it is. So Park Company will be considered safer and are most definitely in a better or worse position than its competitor to make interest payments if the economy turns bad. The fact that theirs is 18 means that they can pay off their interest expense 5 times more than their competitor who can only repay 12 times.
If you need any clarification do comment.
