Answer:
rate variance $ 72,000.00 F
efficiency variance $ 75,000.00 U
Total Variance: 3,000.00 U
Explanation:
DIRECT LABOR VARIANCES
std rate $ 15.00
actual rate $ 12.60 (378,000 labor cost / 30,000 labor hours)
actual hours 30,000
difference $2.40
rate variance $72,000.00
As the company wages were lower than expected, it saved rate-related cost
std hours 25000.00 (5,000 units x 5hours each = 25,000)
actual hours 30000.00
std rate $15.00
difference -5000.00
As the company use more hours the cost were higher than standard
efficiency variance $(75,000.00)
Answer:
What is the basis for the Director’s argument?
- The director believes that this is a temporarily restricted contribution and therefore it should be classified as restricted and recognized in 2007 once it can be classified as unrestricted.
What is the basis for the accountant’s argument?
- Unconditional gifts or donations must be recognized when they are made, and since the money was received in 2006, it should be recognized then.
Explanation:
I agree with the Director since this is a restricted donation, i.e. the donor established strict conditions for its use both in time and purpose. For it to be unconditional, the donor should have stated that the money could be used in the best way that the NPO considers and at any time. But instead it established that it must be used to provide scholarships to musicians during 2007.
Both a condition and a restriction exits:
- the restriction refers to the time: 2007
- the condition refers to its use: scholarships for musicians
Answer:
e. Short-term debt securities such as Treasury bills and commercial paper.
Explanation:
The money market is a branch of financial markets that trade in short-term, high liquidity debt instruments. The money markets create an opportunity for investors and borrowers to buy and sell different types of short term financial securities. The short-term securities maturity period ranges from one day to less than 12 months.
The securities that trade in market markets are called money market instruments. They include commercial papers, Eurodollar deposits, treasury bills, federal agency notes, and certificates of deposit. The money markets are important because they enable companies with temporary financial shortfalls to borrow money by selling money market instruments. They also give companies with cash surplus a platform to invest and earn interests.
Cash deposit received by bank= $250,000
Total deposits= $1,000,000
The Reserve ratio will be 0.25
The amount of reservable liabilities that commercial banks must keep onto rather than lend out or invest is known as the reserve ratio. The central bank of the nation, in this case, the Federal Reserve in the United States, sets this criterion. It is often referred to as the ratio of cash reserves.
The reserve requirement, which is frequently used interchangeably with the reserve ratio, refers to the minimum amount of reserves that a bank must maintain.
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