Answer:
1. Factors to be considered in selecting an allocation base to be used in computing a predetermined overhead rate are:
the cost drivers.
2. The amount of applied overhead for a period does not necessarily have to equal the actual overhead cost of the same period. The reason for the difference is that the applied overhead is based on a predetermined rate(s) and a level or volume of activities, whereas the actual overhead cost is not based on a predetermined rate and a level of activities.
3. Overhead might be underapplied in a given period when the volume of activity between the budgeted and the actual are not equal and when the spending rates differ.
Explanation:
The cost driver is the factor that creates or drives an activity and its associated costs. It is, therefore, the root cause why a particular cost occurs during the activity. This shows that activities consume resources, whereas products and customers consume activities. Examples of cost drivers include the direct labor hours, the direct machine hours, and the number of machine set-ups.
The accounts receivable turnover for the company is 25
The Net sales for a company is $250,000
The average accounts receivable $10,000
The account receivable turnover can be calculated as follows
= Net sales/accounts receivable
= 250,000/10,000
= 25
Hence the accounts receivable turnover for the company is 25
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Answer:
Increasing dividends may not always increase the stock price, because less earnings may be invested back into the firm and that impedes growth.
Explanation:
if increasing dividends results in the company not having enough funds for reinvestment, then value of the company may go down, since value of a stock is the present value of all expected cash-flows from holding the stock. But, if the company is paying dividend from free cash flows, then the payment of the dividend will not negatively affect the value of the stock.
In summary, paying a dividend will not always increase the stock price, and will not always decrease the stock price.
Answer:
No it will not, the statement is incorrect.
Explanation:
if the firm is making a profit, then it means it is growing, so we must determine the firm's growth rate:
firm's growth rate = return on assets (ROA) x (1 - dividends paid)
since we are not given ROA, we must calculate it first:
ROA = net profit x asset turnover = 6% x 2 = 12%
now we go back, firm's growth rate = return on assets (ROA) x (1 - dividends paid) = 12% x (1 - 40%) = 12% x 0.6 = 7.2%
The firm can manage to support an annual growth rate of up to 7.2% before it needs to borrow money or issue new stocks.
Answer:
The symbol designed by Max is an example of trademark. The correct answer is a.
Explanation:
- Trademark is the symbol, sign, expression or design that signifes the products or services of particular company.
- Trademarks that signifies particular company or service mark if it signifies services, is an intellectual property which no other source can use without permission.
- Brand name is the name of the company that develops the product or service obtained which are also named with the same.
