Answer: The predetermined overhead rate increased because the total direct labor-hours dropped
Explanation:
The predetermined overhead rate refers to an allocation rate which is used in applying the estimated manufacturing overhead cost to the cost objects for a particular reporting period.
When there's reduction in the direct labor-hour requirement from 5 hours to 2 hours, the predetermined overhead rate increased because the total direct labor-hours dropped
The predetermined overhead rate is calculated as the total overhead cost divided by the machine hour. Therefore, if there's reduction in the direct labor hour rate, then there will be a rise in the predetermined overhead rate.
Answer:
A. Lowest Total Cost:
A. 315,550 or more
B. Lowest total cost of annual volume of 120 boats
C. C
Explanation:
The lowest total cost among the three alternatives is b.
If the company goes for new location it will have to incur fixed cost of $270,000 and variable cost per boat will be $600.
If the company Subcontracts then Total cost per boat is $2,620
If a company goes for expanding existing facility then it will incur fixed cost of $57,000 and variable cost will be $1,030 per boat.
If company produces 315,000 or more boats then it will have lowest possible cost for the boat.
For an output of 120 bots the best possible alternative is option C. The fixed cost will be $475 per boat ($57,000 / 120 boats)
The total cost will be $1,505 ($475 + $1,030)
Answer:
=2.98%
Explanation:
Use CAPM to find the required return of the stock;
CAPM: r = risk free + beta(market return - risk free)
risk free = 4.5% or 0.045 as a decimal
beta = -0.4
market return = 8.3% or 0.083 as a decimal
Next, plug in the numbers into the CAPM formula;
r = 0.045 -0.4(0.083 - 0.045)
r = 0.045 -0.0152
r = 0.0298 or 2.98%
Therefore the required return is 2.98%
The correct answer is the Life Cycle Fund.
The Life Cycle Fund is a mutual fund that is automatically adjusted during the life of the fund. The fund managers work to balance the investments in the fund to match an investor's age and risk tolerance as the investor gets closer to retirement.
D) A portfolio with a high percentage of stocks, the higher the percentage rate the higher the risk is to lose money