Answer:
1. Relevant costs are also known as unavoidable costs - False.
Relevant costs are in fact, avoidable cost that only emerge in specific business decisions.
2. Incremental costs are also known as differential costs - False
Incremental costs are costs that are incurred when an additional unit of output is produced. Differential costs ocurr when a particular product is made instead of another.
3. An out-of-pocket cost requires a current and/or future outlay of cash. - True
An out-of-pocket cost or expense is a direct payment of money, in other words, an outlay of cash.
4. An opportunity cost is the potential benefit that is lost by taking a specific action when two or more alternative choices are available - True
An opportunity cost can also be defined as what is given up to obtain something.
5. A sunk cost will change with a future course of action. - False
Sunk costs are costs incurred in the past, that cannot be recovered, or modified.
Answer:
(a) Profit margin for A = 5.40%, For division B =9.25% (b) Division B has a superior higher profit margin
Explanation:
Solution
Given that
Division A has a profit = 150,000
sales = $2,780,000
Division B profit = $28,400
Sales =$307,000
Now
(a)We compute for the margin profit for each division which is giving below:
Profit margin=Profit/Sales
Profit margin for A=(150000/2,780,000)
=5.40%
Profit margin for B = (28400/307000)
=9.25%
(b The division B is superior having higher profit margin.
Answer:
Machinning= $487,500
Explanation:
<u>Giving the following information: </u>
The activity rate for Machining is $125 per machine hour.
Product A Product X Total
Machine hours 1,900 3,900 5,800
<u>To assign costs to Product X, we need to use the following formula:</u>
Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base
Machinning= 125*3,900
Machinning= $487,500
Answer:
The correct answer is option (D).
Explanation:
A driver's license is an identity proof but it is not sufficient to verify Javier's eligibility to work in the U.S. as it does not show eligibility for employment. The driver's license is a license provided by the administration to the capable person to drive the vehicle.
While the other options are incorrect because:
- A U.S. birth certificate is incorrect because it is sufficient to verify Javier's eligibility to work in the U.S. as it verifies the eligibility for employment.
- A U.S. passport also verifies the eligibility for employment and hence it is incorrect.
- A permanent resident card is incorrect because it also works as a identity and verifies eligibility for employment.
Answer:
$80750
Explanation:
The total cost of $80,750 would be recorded as the amount or rather the cost of equipment. This is because according to GAAP ( Generally accepted accounting principles), all cost involved in acquiring a business asset including sales tax, insurance and so on should be reported in the balance sheet with a book value that is equal to the overall acquisition cost ( which in this case includes sales tax, insurance, installation and testing).