Answer:
The order should be accepted as it will icnrease contribution by 2,700 dollars
Sales revenue 112,500
variable cost (106,800)
additional fixed cost <u> (3,000)</u>
contribution 2,700
Explanation:
We have to calculate the variable cost to compare against the offer sales price:
COGS
2,600,000 x 70% = 1,820,000
Operating expense
840,000 x 80% = 672,000
total variable 2,492,000
variable per unit:
2,492,000 / 350,000 = 7.12
we now calculate the contribution of the order and subtract the additional cost:
15,000 units x (7.50 - 7.12) -3,000 additional shipping
contribution 2,700
1. Cash at Bank account - Asset
2. Cash in Hand account Asset
3. David Capital account - Owner's equity
4. David Withdrawals account - Owner's equity contra account used for proprietorships.
5. Airlines account - Expense account on the income statement, not a balance sheet account.
6. Flying Fees account - Expense account on the income statement, not a balance sheet account.
7. Accounts Receivable account - Asset
8. Advertisement account - Expense account on the income statement, not a balance sheet account.
9. Fuel Oil account - Expense account on the income statement, not a balance sheet account.
10. Repairs account - Expense account on the income statement, not a balance sheet account
11. Food Expenses account - Expense account on the income statement, not a balance sheet account
12. Accounts Payable account - liability.
You listed a expense items on the income statement. They would only be on the balance sheet if they were accrued liabilities.
Answer:
D. Debit fixed manufacturing overhead spending variance for $40,000
Explanation:
Since fixed manufacturing overhead shows the difference between the actual fixed overhead costs and budgeted fixed overhead cost during a period, Bismith would debit fixed manufacturing overhead spending variance of $40,000 inorder to write off the recording of the variances at the end of the accounting period because the value for fixed manufacturing overhead spending variance has already being gotten hence would be applied at the end of the period.
B makes more sense it should be it
