What is the purpose of cost allocation? why is it so important to allocate cost properly in a business?

A lump sum of $5,000 is invested at 10% per year for five years. The company's cost of capital is 8%. Which is true? The investm

irga5000 [103]

Answer:

The correct answer is B: The investment has a future value of $8,053

Explanation:

Giving the following information:

A lump sum of $5,000 is invested at 10% per year for five years. The company's cost of capital is 8%.

We need to calculate the final value of the investment. We will use the following formula:

FV= PV*(1+i)^n

FV= 5,000*1.10^5= $8,052.55

3 0

3 years ago

For financial accounting purposes, what is the total amount of product costs incurred to make 24,500 units

Anna71 [15]

Answer:

The product cost for 24,500 units is $497,350.

Explanation:

The reason is that the the product cost always includes all the variable production cost and specific fixed production cost. In this scenario, direct material cost, direct labor cost, variable manufacturing overhead cost are variable production cost whereas the fixed manufacturing cost is specific fixed production cost which will form part of product cost. The remainder of the cost left is period cost.

Direct materials (24,500 * $7.7 per unit) $188,650

Direct labor (24,500 * $4.7 per unit) $115,150

Variable manufacturing overhead (24,500 * $2.2 per unit) $53,900

Fixed manufacturing overhead (24,500 * $5.7 per unit) <u>$139,650 </u>

Total product costs $497,350

7 0

3 years ago

Under an acceptable method of costing by-products, inventory costs of the by- product are based on the portion of the joint prod

saw5 [17]

Answer:

b. plus any subsequent processing cost.

Explanation:

In the case of the acceptable costing method for by-products the inventory cost that are depend upon the joint cost should be distribution to the by-product plus if there is any processing cost

that means

Inventory cost of the bu-product = joint cost + processing cost

Therefore the same should be considered

5 0

3 years ago

On December 31, 2021, the end of the fiscal year, California Microtech Corporation completed the sale of its semiconductor busin

Hunter-Best [27]

Answer and Explanation:

The preparation of the lower portion is presented below:

Income from the continuing operation

before income tax $7,800,000

Less: Income tax expenses ($7,800,000 × 25%) (1,950,000)

Income from continuing operation(A) 5,850,000

Discontinued operation:

Loss from operation discontinued components

($15 - $13 - $4.8) ($2,800,000)

Income tax benefits ($2,800,000 × 25%) $700,000

Loss on discontinued operation(B) ($21,000,000)

Net loss (A - B) -$15,150,000

7 0

3 years ago

Splish Company provides the following information about its defined benefit pension plan for the year 2017. Service cost $110,00

kipiarov [429]

Answer: $155,520

Explanation:

Pension Expense = Service Cost - Expected return on plan assets + Prior service cost amortization + Interest cost

Interest Cost

= Interest rate * Projected benefit obligation

= 0.09 * 728,000

= $65,520

Pension Expense = 110,000 - 30,000 + 10,000 + 65,520

= $155,520

3 0

3 years ago