Lavender company is a logistics company and has recently implemented abc system. using activityminus−based information, it deci
1 answer:
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Answer:
D : $88,800
Explanation:
<u>Cost of goods manufactured :</u>
Direct Material used in production $ 21,300
Indirect Material used in production $ 3,700
Direct Labour $ 34,100
Direct Labour $ 5,900
Manufacturing overhead <u> $ 16,600 </u>
Total Manufacturing cost $ 75100
Add:Beginning Work in process inventory $7,200
Less: Ending Work in process inventory <u>$ 0 </u>
Cost of Goods Manufactured <u>$88,800</u>
Answer:
0.147 or 14.7%
Explanation:
Equity (E) =$7
Debt (D) = $1
Cost of equity capital (Ce) = 0.16
Pretax cost of debt (Cd) = 0.08
Tax rate (r) = 0.3
The weighted average cost of capital of the firm is given by the following relationship:
The weighted average cost of capital of the firm is 0.147 or 14.7%.