Answer: D. Manufacturing overhead was underapplied by $10,000; Cost of Goods Sold after closing out the Manufacturing Overhead account is $253,000
Explanation:
The Manufacturing overhead applied is less than the actual manufacturing overhead incurred by:
= 79,000 - 69,000
= $10,000
Manufacturing overhead is therefore underapplied as the amount applied is too low to cover the amount incurred.
The Cost of Goods sold after closing out is:
= Cost of goods sold before closing out + Underapplied manufacturing overhead
= 243,000 + 10,000
= $253,000
Answer:
Option C She can claim an estimated value for the auto if the charity uses it rather than selling it
Explanation:
The reason is that the tax encourages you to make donations because the non for profit organization is doing the same thing which government does, they serve the people. So if the NGO is not selling the old car then the tax says that use the fair value of the asset as a amount donated to the charitable foundation. So the right answer here which includes the use of fair value is only Option C.
Answer:
Accounting profit=$300,000
Explanation:
<em>Accounting profit is the difference between revenue from from production or service activities and the expenditures incurred. </em>
<em>It is the difference between the total revenue and the</em><em> total explicit costs</em><em>. Explicit costs are those transaction cost incurred to generate revenue . E.g the cost of the material , labour, expenses e.tc.</em>
On the other hand, economic profit includes accounting profit plus opportunity cost. Opportunity cost is the value of the benefits sacrificed in favour of a decision.
Accounting profit = Sales revenue - Explicit cost
Sales revenue = Price × units sold= $15× 1000× 30 = $450,000
1
Explicit cost = $150,00
Accounting profit = $450,000- 150,000 = $300,000
Accounting profit=$300,000
Note we ignore the amount she could have earned because it is an implicit cost
Answer:
12.64%
Explanation:
In this question, we apply the Capital Asset Pricing Model (CAPM) formula which is shown below
Expected rate of return = Risk-free rate of return + Beta × (Market rate of return - Risk-free rate of return)
= 4% + 0.87 × 7.4%
= 4% + 6.438%
= 10.438%
The Market rate of return - Risk-free rate of return) is also known as the market risk premium and the same is applied.
Now the required rate of return would be
= 10.438% + 2.2%
= 12.64%
