Answer:
Explanation:
The preparation of the company’s income statement is presented below:
Home Realty, Incorporated
Income statement
Sales revenue $181,000
Less: Total expenses
Salaries and wages expense ($100,000)
Interest expense ($6,600)
Advertising expenses ($9,175)
Income tax expense ($18,800)
Net income $46,425
Answer:
For (a) $21250 favorable (b) $21300 Unfavorable
Explanation:
Solution:
Now,
(a) The Standard rate of variable overhead = $450000/60000 = $7.50 per hour
so,
The Variable factory overhead controllable variance = Actual variable overhead costs - Standard variable overhead costs
Gives,
= (725000-262500)-(64500*7.50) = $21250 favorable
(b) The fixed factory overhead volume variance = Budgeted overhead - standard overhead
= 262500 - 262500*64500/60000
Therefore,
= $21300 Unfavorable
Answer:
The correct answer is B Contract
Explanation:
A lease is a contract outlining the terms under which one party agrees to rent property owned by another party. This contract guarantees the lessee/ tenant use of an asset and guarantees the lessor, the property owner or landlord, regular payments (rent) for a specified period in exchange.
Answer:
Hence, the minimum transfer price = $2
Explanation:
Transfer price is the price at which goods are exchange between branches or divisions of the same group
Where a division is operating at the less than the existing capacity, to optimist the group profit, the minimum transfer price should be set as follows
Minimum transfer price = Variable cost
It is worthy of note that there is no opportunity cost associated with any transfer to the Cologne division because the Bottle division is currently having excess capacity- it can meets all demands both external and internal.
<em>Therefore, any offering price equal to or above the variable manufacturing cost of $2 would be acceptable and optimize the group profit</em>.
Hence, the minimum transfer price = $2
