Answer:
This project should be rejected because the AAR is 10.68 percent.
Explanation:
The accounting rate of return of the project needs to computed,compared with the required accounting rate of return in order to decide whether the project should accepted or rejected:
Profit margin=$86,800*6%=$5208
Average operating assets=($97,500+$0)/2=$48.750
Accounting rate of return=profit margin/average operating assets*100
Accounting rate of return=$5,208/$48,750*100=10.68%
The project accounting rate of return is lower than the required accounting rate of return,hence the project should be rejected.
Answer:
Stakeholders
Explanation:
A stakeholder is anybody to takes key interest in the functioning of an organization. Stakeholder is directly or indirectly affected by the success and failure of the organization. A stakeholder could be an investor who has invested money in the firm; a customer who uses the products manufactured by the firm; a debtor who owes money to the firm or creditor who the firm owes money.
As such, a stakeholder is related to the firm through one or the other medium such as markets, industry or operations.
Climate Change is the first trend that is expected to cause more natural disasters. This has been facilitated by global warming caused by increased green house gases. Food prices are expected to rise due to high temperatures that has affected corn and soybean. Floods and storms are now becoming unpredictable.
There is high control of oil, gas and food prices by financial markets. Commodities traders are now setting prices instead of supply and demand thus the value of dollar in under the control of foreign exchange traders.
Increasing rates of interest, where recently the Federal Reserve wants to increase the Fed fund rates to two percent point. Inflation will be at 2% and unemployment at 4% thus this will show <u>a no falling to recession situation</u> which will allow Fed to keep increasing rates.In the long run cost of loans will rise.
Other trends to notice are;the decline in global economic power of the U.S and the fact that the U.S economy is current in the expansion phase of the business cycle.
Answer:
Total cost of the units made in January = $35,400
Explanation:
Direct material cost in January = Direct material cost per unit * Units produced in January = $20 * 600 = $12,000
Direct labor cost in January = Direct labor cost per unit * Units produced in January = $30 * 600 = $18,000
Overhead costs in January = (Units produced in January / Expected units for the year) * Expected overhead costs for the year = (600 / 6,000) * $54,000 = $5,400
Therefore, we have:
Total cost of the units made in January = Direct material cost in January + Direct labor cost in January + Overhead costs in January = $12,000 + $18,000 + $5,400 = $35,400
