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iogann1982 [59]
3 years ago
13

Assuming that there are no income taxes, what would be the ROI and residual income, respectively, for this equipment, which has

an average value of US $100,000?
Business
1 answer:
anygoal [31]3 years ago
5 0

Please see complete question below :

CPA-08299: Managers of the Doggie Food Co. want to add a bonus component to their compensation plan. They are trying to decide between return on investment (ROI) and residual income (RI) as the performance measure they will use. If Doggie adopts the RI performance measure, the relevant required rate of return would be 18%. One segment of Doggie is the Good Treats division, where the manager has invested in new equipment. The operating results from this equipment are as follows:

Revenues $ 80,000

Cost of goods sold 45,000

General and administrative expenses 15,000

Assuming that there are no income taxes, what would be the ROI and RI for this equipment that has an average value of $100,000?

ROI RI

Answer:

ROI =  20% and RI = $2000

Explanation:

Return On Investment(ROI) = Profit before Interest & Tax/Average Investment

Profit before Interest & Tax (PBIT) = Revenue -cost of goods sold- General & Adm expenses

PBIT= $ 80,000 - $45,000 -$15,000

      = $20,000

ROI = ($20,000/100,000) * 100% = 20%

Residual Income = PBIT - (Average Investment* Required Rate of Return)

                            =$20,000- (18%* 100,000)

                           =$20,000- $18,000

                           = $2000

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BaLLatris [955]
<span>Er macht nicht 1000 Liegestütze pro Tag</span>
4 0
3 years ago
The Mixing Department of Complete Foods had 62,000 equivalent units of materials for October. Of the 62,000 ​units, 38,000 units
Art [367]

Answer:

Materials

62,000 equivalent units

Conversion

42,800 Equivalent untis

Cost of finished Goods

38,000 x (.75 + .55) = 38,000 x 1.3 = $49,400

WIP

24,000 x .75 = 18,000

4,800 x .55 =    2,640

Total WIP         20,640

Explanation:

Equivalent Units

38,000 complete

20% of 24,000 WIP  = 4,800

Equivalent Units CC = 42,800

x .55 CC = 23540

Materials

62,000 x .75 = $46,500

6 0
3 years ago
________ is the analysis and redesign of workflow within and between enterprises. Multiple Choice Business process reengineering
stich3 [128]

(C) Business process reengineering (BPR) is the analysis and redesign of workflow within and between enterprises.

<h3>What is Business process reengineering (BPR)?</h3>
  • Business process re-engineering (BPR) is an early 1990s business management method that focuses on the analysis and design of workflows and business processes within a company.
  • BPR seeks to assist firms in fundamentally rethinking how they do business in order to improve customer experience, reduce operational costs, and compete on a global scale.
  • BPR aims to assist businesses in significantly restructuring their organizations by focusing on the design of their business processes from the ground up.
  • A business process, according to early BPR proponent Thomas H. Davenport (1990), is a sequence of logically related operations executed to produce a specific business objective.

Therefore, (C) business process reengineering (BPR) is the analysis and redesign of workflow within and between enterprises.

Know more about Business process reengineering here:

brainly.com/question/14019951

#SPJ4

Complete question:

__________ is the analysis and redesign of workflow within and between enterprises.

Multiple Choice

(A) Critical success factors (CSFs)

(B) Benchmarking metrics

(C) Business process reengineering (BPR)

(D) Decision support interfaces (DSI)

5 0
2 years ago
Which of the following is true?
Deffense [45]

Which of the following is true?

b.

net cash flow + cash outflow = cash inflow

Total Cash Inflow is basically Cash Reciepts, Cash inflow from Sale of Assets and the like. Cash Outflow refers to Expenses paid, Assets purchased etc. Net Cash flow is basically the difference between Cash Inflow and Cash Outflow, It could be negative if outflow is more than inflow and positive if inflow is more than outflow.

Observing the above explanation, B Seems like the correct Option.

8 0
3 years ago
Read 2 more answers
Utopia Corporation provides $6,000 worth of lawn care on account during the month. Experience suggests that about 3% of net cred
photoshop1234 [79]

Answer:

The answer is C.

Explanation:

Credit sales is $6,000

Bad debt is 3% of net credit sales which is $180($6,000 x3%)

Creating allowance for doubtful debt entry is one of the prudent method and it tells us that some customers won't pay part of what they are owing. And it is also a contra account that offset bad debt.

According to the accounting rule, debit increases asset and expenses and vice-versa while credit decreases liability, equity, income and vice versa.

So we have have:

Dr Bad debt expense $180

Cr Allowance for Doubtful Accounts $180

6 0
3 years ago
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