Yellow, Inc., sells a single product for $10. Variable costs are $4 per unit and fixed costs total $120,000 at a volume level of
1 answer:
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Answer:
Leverage factor will be 1.344
Explanation:
We have given operating income = $29000
And variable expenses is 65 5 of the sales
And fixed expenses = $10000
So contribution margin = $29000+$10000 = $39000
We have to find the leverage factor
Leverage factor is given by
Leverage factor
So leverage factor will be 1.344
Answer:
B
Materials Control $ 250
Manufacturing Overhead Control $1,000
Work-in-Process Control $1,250
Explanation:
spoilage rate: 10/1000 = 0.01=1%
the job requires 2,500 goods parts
total part required (considering spoilage)
2,500 /(1-0.01) = 2500/ 0.99 = 2525.2525 = 2525
2525-2500 = 25 spoilage part
<u>Note:</u>
in this case you may think you can simple do 2,500 x 0.01
But if the spoilage rate is high or the amount of high is, then you will have an answer different than the correct method. Stick to the formula given.
25 part x 50 = 1,250
From the work in process, we will subtract this value, we will increase the spoilage materials inventory and charge the diference as actual overhead.
b.
Materials Control $ 250
Manufacturing Overhead Control $1,000
Work-in-Process Control $1,250