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julia-pushkina [17]
3 years ago
6

Tiffany charges manufacturing overhead to products by using a predetermined application rate, computed on the basis of labor hou

rs. The following data pertain to the current year: Budgeted manufacturing overhead: $ 3,900,000
Actual manufacturing overhead: $ 3,917,000

Budgeted labor hours: 130,000

Actual labor hours: 132,300

Which of the following choices is the correct status of manufacturing overhead at year-end? Overapplied by $17,000. Underapplied by $17,000. Overapplied by $52,000. Underapplied by $52,000. Overapplied by $69,000.
Business
1 answer:
forsale [732]3 years ago
7 0

Answer:

Overapplied by $52,000.

Explanation:

To know the application of the overhead we need to solve for the predetermined rate first:

\frac{Cost\: Of \:Manufacturing \:Overhead}{Cost \:Driver}= Overhead \:Rate

we distribute the expected overhead over the expected cost driver. in this case, it is labor hours:

$ 3,900,000 / 130,000 labor hours  = $ 30 per hours

Now we calculate the aplication:

<u>actual labor hours x rate:</u>

132,300 x 30 = 3,969,000

Finally we compare with the actual overhead cost:

applied      -   actual

3,969,000 - 3,917,000 = 52,000

As the cost applied exceed the real cost, we overapplied the voerhead we capitalzie more cost than actual cost.

we face an overapplication of the overhead cost.

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When government policy moves from a budget surplus to a budget deficit and the trade deficit remains constant: savings will decr
Dovator [93]

Investment will decline if savings also decline when a government's fiscal policy switches from a budget surplus to a budget deficit and the trade deficit stays steady.

<h3>What occurs if there is a budget surplus or deficit for the government?</h3>
  • A budget deficit occurs when the federal government spends more money than it takes in from taxes in a given year.
  • In contrast, the government has a budget surplus when it collects more taxes than it spends in a single year.
<h3>What distinguishes a budget surplus from a budget deficit?</h3>

A government experiences a budget surplus when its tax revenues exceed its expenditures, a budget deficit when its expenditures exceed its tax revenues, and a balanced budget when the two figures are equal.

<h3>How do trade deficits result from budget deficits?</h3>

A budget deficit causes interest rates to rise, which raises net capital inflows and currency depreciation, which lowers net exports.

learn more about budget surplus and deficit here

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3 0
2 years ago
Alice purchased office furniture on September 20, 2018, for $100,000. On October 10, 2018, she purchased business computers for
lana [24]

Answer:

The correct answer is $30,290.

Explanation:

According to the scenario, the computation can be done as follows:

This applies regular MACRs

So, As furniture is the Seven year property,

So, the cost recovery deduction for the furniture = $100,000 × .1429

= $14,290

And The computer is a five year asset

So, the cost recovery deduction for the Computer = $80,000 × .20

= $16,000

So, Total Cost recovery deduction = Cost of recovery deduction for furniture + cost of recovery deduction for computer

= $14,290 + $16,000

= $30,290

Hence, the cost recovery deduction for the business assets for 2019 is $30,290.

8 0
4 years ago
Fortune Drilling Company acquires a mineral deposit at a cost of $5,900,000. It incurs additional costs of $600,000 to access th
satela [25.4K]

Answer:

Option C is the correct answer.

<u>Debit Depletion Expense $1,358,500; credit Accumulated Depletion $1,358,500.</u>

Explanation:

Fortune Drilling Company acquires a mineral deposit at a cost of $5,900,000. It incurs additional costs of $600,000 to access the deposit, which is estimated to contain 2,000,000 tons and is expected to take 5 years to extract. Compute the depletion expense for the first year assuming 418,000 tons were mined.

Depletion expense = ( Mineral Deposit Cost + Additional cost)/ Estimate Extraction * N0 of ton extracted in first year

Depletion expense = (5900000 + 600000)/2000000 * 418000

Depletion expense = $ 1,358,500

6 0
3 years ago
The risk-free rate of return is 8%, the expected rate of return on the market portfolio is 15%, and the stock of Xyrong Corporat
koban [17]

Answer:

Risk-free rate (Rf) = 8%

Return on market portfolio (Rm) = 15%

Beta (β) = 1.2

Ke = Rf + β(Rm - Rf)

Ke = 8 + 1.2(15 - 8)

Ke = 8 + 1.2(7)

Ke = 8 + 8.4

Ke = 16.40%

Earnings per share (EPS) = $10

Current dividend paid (Do) = 40% x $10 = $4

Retention rate (b) = &6/$10 x 100 = 60% = 0.6

ROE (r) = 20% = 0.2

Growth rate (g) = b x r

                         = 0.6 x 0.2

                         = 0.12 = 12%

Current market price (Po)

= Do<u>(1 + g) </u>  

        Ke - g

= $4<u>(1 + 0.12)</u>

     0.1640 - 0.12

= $4<u>(1.12)</u>

      0.044

= $101.82

             

Explanation:

First and foremost, we need to calculate the cost of equity based on capital asset pricing model. Then, we will determine the growth rate, which is a function of retention rate (b) and return on equity(r).

Finally, we will calculate the current market price, which is dividend paid, subject to growth, divided by the excess of cost of equity over growth rate.

7 0
4 years ago
The human resource department at Paula's Powerwheels is implementing a number of functional level strategies. These strategies i
katen-ka-za [31]

Answer:

The correct answer is Cost leadership.

Explanation:

Cost leadership are those strategies with which products similar to those of other companies are offered at a lower cost, that is, a certain company is considered to be the lowest cost producer in its industrial sector in order to achieve a differentiation.

At lower prices than its rivals, the leader's position translates into higher returns, however, standard products should not be sold ignoring the basis of product differentiation itself, since, if the customer does not perceive the product as comparable, The company must set very low prices in relation to the competition to achieve sales.

The sources to obtain this type of advantages are varied and depend on the structure of the industrial sector itself, including economies of scale, the use of proprietary technology, preferential access to the raw material, among others.

The cost leadership strategy aims to make a company the leader, rather than several companies struggling to reach that position, as this implies tough rivalry and competition that can have unfavorable consequences for all.

8 0
4 years ago
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