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WARRIOR [948]
3 years ago
8

TB MC Qu. 06-49 Radakovich Corporation has provided the... Radakovich Corporation has provided the following data from its activ

ity-based costing system: Activity Cost Pools Total Cost Total Activity Assembly $ 1,372,578 61,800 machine-hours Processing orders $ 63,235 2,010 orders Inspection $ 151,316 2,090 inspection-hours The company makes 600 units of product F60N a year, requiring a total of 1,200 machine-hours, 78 orders, and 34 inspection-hours per year. The product's direct materials cost is $49.55 per unit and its direct labor cost is $12.44 per unit. The product sells for $128.70 per unit. According to the activity-based costing system, the product margin for product F60N is: (Round your intermediate calculations to 2 decimal places.) $40,026.00 $10,920.12 $8,458.52 $10,912.40
Business
1 answer:
Crank3 years ago
5 0

Answer:

$8,460

Explanation:

The computation of product margin for product F60N is shown below:-

Total overhead cost = ($1,372,578 × 1,200 ÷ 61,800) + ($63,235 × 78 ÷ 2,010) + ($151,316 × 34 ÷ 2,090)

= $26,652 + $2,454 + $2,462

= $31,568

Per unit overhead cost = $31,568 ÷ 600

= $52.61

Per unit cost = Direct material + Direct labor + Overhead cost

= $49.55 + $12.44 + $52.61

= $114.60

Finally

product margin for product F60N is = (Selling price - Per unit Cost) × Number of units sold

= ($128.70 - $114.60) × 600

= $14.1 × 600

= $8,460

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Answer:

Designs by Candice

Her costs include:

Costs of materials, labor, overheads.  

Then in charging her customers she would include the profit target of $7,623 (representing 11% of her capital investment).

Explanation:

As a graphic design studio, Design by Candice would buy stationery and design materials, including 3D printers and other software.  Candice would also incur labor costs on those doing the design proper.  There are also manufacturing overheads, including rent, utilities, etc. and not to forget other indirect costs like selling and marketing and administrative expenses.

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Assume the following data for Cable Corporation and Multi-Media Inc.
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Answer:

a-1 Cable Corporation 13.05

Multi-media Inc. 33.1%

a-2 Multi-Media Inc.

2. Cable Corporation Multi-Media Inc.

Net income/Sales 9.84% 5.19%

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Explanation:

a-1. Computation to determine the return on stockholders’ equity for both firms.

CABLE CORPORATION

Using this formula

Return on Stockholders’ Equity= Net Income / Stockholder’s equity

Let plug in the formula

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Return on Stockholders’ Equity=$140,000 / 423,000

Return on Stockholders’ Equity= 33.1%

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b. Computation for the following additional ratios for both firms.

Cable Corporation Multi-Media Inc.

Net income/Sales 9.84% 5.19%

($31,200/317,000=9.84%)

($140,000/2,700,000=5.19%)

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Sales/Total assets .79 times 2.80 times

(317,000/402,000=.79 times

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(163,000/402,000=40.55%)

( 542,000/965,000=56.17%)

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3 years ago
In mid-2015, Qualcomm Inc. had $13 billion in debt, total equity market value of $87 billion and an equity beta of 1.41. Include
lesya692 [45]

Answer:

A) Qualcomm's enterprise value= $95 billion

B) Asset Beta of Qualcomm’s business = 1.29

C) Qualcomm's WACC= 7.931%

Explanation:

The question relates to Capital asset pricing model (CAPM) which is used to calculate the required return from an investment given the level of risk associated with the investment. Now there are many risk that the level of cash flows and hence the required return from an investment such as systematic and unsystematic risks, business and finance risks etc.

The requirements of the question are as follows:

a)What is Qualcomm’s enterprise value?

b)What is the beta of Qualcomm’s business assets?

c)What is Qualcomm’s WACC?

The first two requirements will help us compute requirement C so we begin solving it form A as follows:

A) Qualcomm's enterprise value= ve- vd +va

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vd= value of debt

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Qualcomm's enterprise value= $95 billion

B) Beta of Qualcomm’s business assets:

Now beta is an index used to measure systematic risks (risks posed by macro-economic factors such as tax, interest rates etc). There are two beta indexes, asset beta and equity beta. Asset beta measures business risks only and equity beta measures both business and finance risks. In the question we already have equity beta so we need to calculate asset beta in order to compute Qualomm's WACC.

ba = be× ve/enterprise value

ba = asset beta

be= equity beta

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C) Qualcomm’s WACC:

The formula is as follows:

Ke= Rf + (market premium)× ba

ke = WACC

Rf= risk free rate of interest

ba= asset beta

ke= 2.9% + (3.9% ×1.29)

ke/WACC= 7.931%

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