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lesantik [10]
3 years ago
14

A production manager is evaluated based on the quantity of direct materials used in production. If the production line actually

uses materials to produce 50,000 units when the master budget shows materials needed for 44,000 units, the manager's evaluation should be based on a flexible budget. True or False
2.) Which of the following remains the same when comparing a flexible budget to a master budget?
A. Total sales.
B. Net income.
C. Total variable costs.
D. Total fixed costs.
Business
1 answer:
Shalnov [3]3 years ago
3 0

Answer:

1) True

2) D. Total fixed costs

Explanation:

1)  The manager's evaluation should be based on a flexible budget, so the statement is true.

The standard quantity of direct materials used should be based on actual production for a correct variance analysis.

2 ) Total fixed costs remains the same when comparing a flexible budget to a master budget.

Total fixed costs do not change in total within relevant range of production.

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Real World Financials ABC Corporation reported the following information in its financial statements for three successive quarte
Debora [2.8K]

Answer:

(Q4) Receivables turnover ratio=  1.135

(Q1) Receivables turnover ratio= 1.153

Average collection period for Q1=31 7 days

Average collection period for Q4 =  317 days

Explanation:

The Receivables turnover ratio gives us the efficiency of collections and the Average collection period tells us the number of days in which the receivable is collected.

Three Months Ended (Q1)                (Q4)                       (Q3)

                                9/30/2017        6/30/2017          3/31/2017

Balance sheets:

Accounts receivable, net $ 21,361    $ 19,880            $ 12,970

Income statements:

Sales revenue $ 24,620                   $ 23,400             $ 22,260

Receivables turnover ratio= Net Sales / Average Accounts Receivable

Average Accounts Receivable= Net Receivables for one Quarter +  Net Receivables for other Quarter/2

 (Q3) Receivables turnover ratio= $ 22,260/   $ 12,970 + $ 19,880/2

     (Q3) Receivables turnover ratio= $ 22,260/  16425

         (Q3) Receivables turnover ratio= 1.355

This indicates that average accounts receivable balance is converted into cash 1.355 times during the quarter.

 (Q4) Receivables turnover ratio=   $ 23,400 /$ 19,880  + $ 21,361 /2

   (Q4) Receivables turnover ratio=   $ 23,400 /20620.5

(Q4) Receivables turnover ratio=  1.135

This indicates that average accounts receivable balance is converted into cash 1. 135 times during the quarter.

(Q1) Receivables turnover ratio=   $ 24,620/$ 21,361 ( assuming net is average)

(Q1) Receivables turnover ratio= 1.153

This indicates that net accounts receivable balance is converted into cash

1. 153 times during the quarter.

Average collection period for Q1 =  365/ Receivables turnover ratio

Average collection period for Q1= 365/1.153= 316.6= 317 days

Average collection period for Q1=31 7 days

Average collection period for Q4 =  365/Receivables turnover ratio

Average collection period for Q4 = 365/1.15= 317.4= 317 days

8 0
3 years ago
Direct and Indirect Costs Kubin Company's relevant range of production is 18,000 to 22,000 units. When it produces and sells 20,
pychu [463]

Answer:

a) direct manufacturing cost    $220,000

b) indirect manufacturing cost $130,000

2 a) the manufacturing department cost will be of $350,000

  b) zero as direct material, labor and overhead can be determinated.

3) a) $40,000

  b) $50,000 advertizement.

4) No as we can set the object cost to determinate the direct and indirect cost of the adminsitrative expenses.

Explanation:

a) The direct manufacturing cost will be the variable manufacturing cost linked to the unit cost:

Materials $7 + Labor $4 = $11 per unit

20,000 units x $11.00 = $ 220,000

b) indirect manufacturing cost will be the overhead.

20,000 x ($1.5 + $5) = 130,000

2)

a) Materials, labor and overhead.

which totals for 350,000

2 b) all the manufacturing cost are traceable so zero.

3)

fixed selling

20,000 x 3.5 = 70,000

less 50,000 advertizement = 20,000

variable sales:

commisions $1 x 20,000 + 20,000 = 40,000 direct cost (sales persons)

b) the indirect cost will be the advertizement as cannot be linked directly to the sales person cost.

3 0
3 years ago
Miguel Corporation, a foreign subsidiary of a U.S. parent company, has one asset (Land) and no liabilities. The functional curre
user100 [1]

Answer:

All the 4 statements are correct.

Explanation:

The International Accounting Standard on Currency changes says that the all the assets and liabilities of the subsidiary must be reported at market value of the asset both at the end of the year and at the time of sale of asset & payment of liability. So this means that the statement a and d are correct statements because the translation gain or loss is reported by using the spot rate which is the market value of the asset in the parent company's currency. Similarly, the statement b and c are correct because at the time of sale of subsidiary assets we are actually recognizing the remeasurement gain or loss by using the spot rate, which is the market value of the asset in the parent company's currency.

5 0
2 years ago
Inventory depletion is a warning sign of: Impending inflation. A recessionary gap. Cyclical unemployment. Both a recessionary ga
vovangra [49]

Answer:

Both a recessionary gap and cyclical unemployment.

7 0
3 years ago
The Retained Earnings balance was $24,100 on January 1. Net income for the year was $19,900. If Retained Earnings had a credit b
padilas [110]

Answer: $17800

Explanation:

The opening balance of Retained earnings = $24,100

Net Income for the year = $19,900

Closing balance of Retained earnings = $ 26,200

The, the amount of dividends declared during the year = (opening balance) +(Net Income) -( Closing balance)

= $ (24100+19900-26200)

= $17800

Hence, the amount of dividends declared during the year  is $17800.

4 0
2 years ago
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