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xxTIMURxx [149]
3 years ago
12

The management of Kabanuck Corporation is considering dropping product V41B. Data from the company's accounting system appear be

low:Sales $938,000Variable expenses $413,000Fixed manufacturing expenses $525,000Fixed selling and administrative expenses $352,000All fixed expenses of the company are fully allocated to products in the company's accounting system. Further investigation has revealed that $215,000 of the fixed manufacturing expenses and $126,000 of the fixed selling and administrative expenses are avoidable if product V41B is discontinued.What would be the effect on the company's overall net operating income if product V41B were dropped?
Business
1 answer:
natita [175]3 years ago
8 0

Answer:

if dropped the differential loss will be of 184,000

the income will decrease 184,000

It is better to continue with the production.

Explanation:

\left[\begin{array}{cccc}&$Continued&$Discontinued&$Differential\\$Sales&938,000&-&-938,000\\$Variable&-413,000&-&413,000\\$Avoidable&-341,000&-&341,000\\$Allocate cost&-536,000&-536,000&-\\$Result&-352,000&-536,000&-184,000\\\end{array}\right]

If dropped sales and variable expenses will be zero.

We will determinate the avoidable cost:

215,000 manufacting + 126,000 S&A = 341,000

<u>and the allocated cost will be:</u>

total fixed cost - avoidable cost

(525,000+352,000) - 341,000 = 536,000

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Answer:

Instructions are below.

Explanation:

Giving the following information:

Variable cost:

Direct material= $0.50 per unit

Fixed cost:

Fixed overhead= $15,000

Total cost for 10,000 units:

Variable cost= 0.50*10,000= 5,000

Fixed costs= 15,000

Total cost= $20,000

Total cost for 15,000 units:

Variable cost= 0.50*15,000= 7,500

Fixed costs= 15,000

Total cost= $22,500

8 0
3 years ago
Zoum Corporation had the following transactions during the year: Issued $250,000 of par value common stock for cash. Recorded an
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Answer:

-$210,000

Explanation:

Issued Common Stock at par for Cash $250,000

Less:

Declared and paid a cash dividend $20,000

Repayment of 6-year note payable $440,000

Net Cash provided by Financing Activities ($210,000)

8 0
3 years ago
For each item listed below, indicate the effect on net income in arriving at cash flows from operations by choosing one of the f
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3 years ago
The Federal Reserve System and the New York Stock Exchange regulations currently require the short seller to have an initial mar
lutik1710 [3]

Answer:

Correct answer is 50%

Explanation:

The appropriate response is half.  

The Regulation T of the Federal Reserve Board requires the equalization for all short deal records to be at any rate 150% of the estimation of the protections at the time the deal is started.  

This implies when the short deal is started, as we are selling the offers first, our record will have the 100% estimation of the offers sold (as we receipts of cash from selling) in addition to an extra edge prerequisite of half of the estimation of the short deal.  

For instance, on the off chance that I am short selling an offer whose cost is $100, at that point when I short sell the offer, my record equalization will become $100, as receipts of the deal.  

Along these lines, at the hour of inception of offer, my record equalization ought to be 150% of the estimation of short deal = 150% of $100 = $150. The separation of this sum is  

100% of $100 = $100, which gets credited to my record  

in addition half of $100 = $50, which is the edge necessity at the inception of short deal.  

In this way, Initial edge necessity is atleast half of the cost of the stock.  

The student ought not befuddle the underlying edge necessity with the base upkeep edge.  

The base support edge required to be kept up is 25%. This implies the short dealer ought to consistently have an edge (not balance) of 25% in the record. In the event that the edge goes beneath 25%, at that point the edge require the distinction sum is actuated, which the short dealer is required to pay to keep on keeping her situation in the market unaltered.  

Be that as it may, beginning edge required to be kept up is half.

8 0
3 years ago
The Shoe Exchange issues 3,000 shares of its $1 par value common stock to provide funds for further expansion. The issue price i
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Answer:

Debit Cash account           $57,000

Credit Shares capital         $3,000

Credit Share premium       $54,000

Being entries to record cash received from the issuance of shares

Explanation:

Par value per share = $1

Issue price per share = $19

Premium per share from issue = $19 - $1

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Number of issued shares = 3000

Share capital balance from issue = 3000 × $1

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Premium balance = 3000 × $18

                             = $54,000

Cash received from Issue = 3000 × $19

                                           = $57,000

Entries to be posted

Debit Cash account           $57,000

Credit Shares capital         $3,000

Credit Share premium       $54,000

Being entries to record cash received from the issuance of shares.

4 0
3 years ago
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