Answer:
the spending variance is $6,904 favorable
Explanation:
The computation of the spending variance is as follows;
Budgeted Expense is
= 1,230 cars × $4.80 per car + $26,000
= $5,904 + $26,000
= $31,904
And, the actual expense is $25,000
Therefore, the spending variance is
= $31,904 - $25,00
= $6,904
Therefore, the spending variance is $6,904 favorable
Answer:
$43,500
Explanation:
<em>Net income = sales - expenses </em>
sales = 115,000
expenses (cost) = 71,500
net income = 115,000 - 71,500 = 43,500
<u>We calculate based on the matching principle.</u>
The revenues and expenses should be recognized during the period they occur.
In this case, the sales are for 115,000 regardless of the amount collected during the period or subsequent periods
The expenses for the period are 71,500 Even if a portion remains unpaid at the end of the year, all the expenses for the year should be included in the calculation.
Answer:
$76,100
Explanation:
This calculation is based on the recognition principle of accrual accounting which sates that revenues must recognized when they are earned and expenses accounted for when they are incurred no matter when cash is received or paid.
Therefore, only 9 months (i.e. April 1 - December 31 = 9 months) of the retainer will be recognized or used in the calculation of total revenue as follows:
1. Monthly retainer for services = $18,800 ÷ 12 = $1,566.67
2. Year 1 service retainer (April 1 - December 31) = $1,566.67 × 9 months
= $14,100
3. Total revenue = Year 1 service retainer + Legal services
= $14,100 + $62,000
= $76,100
Note:
Other details are expenses and net profit appropriation which are only relevant for calculating the net profit and retained profit. These are however beyond the scope of the question.
Answer: Customer relationship management
Explanation: Customer relationship management is the process which focuses on building customer royalty and positive relationships with the current and potential customers. It is based on giving quality service and maximum satisfaction to the customer, by fulfilling their specific needs and preference.
In the given case, Franco is taking care of customer needs by keeping records. By managing such records he can make sure to have sufficient stock in hand for fulfilling the orders.
Hence, Franco's system is a part of customer relationship management.
