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Mrac [35]
3 years ago
14

Fidelity Stereo Company has provided the following information regarding its activity-based costing system:Purchasing department

costs are allocated based on purchase orders, and the predetermined overhead allocation rate is $77 per purchase order.Assembly department costs are allocated based on the number of parts used, and the predetermined overhead allocation rate is $5 per part.Packaging department costs are allocated based on the number of units produced, and the predetermined overhead allocation rate is $4 per unit produced.Each stereo produced has 50 parts, and the direct materials cost per unit is $70. There are no direct labor costs. Fidelity Stereo has an order for 1200 stereos, which will require 45 purchase orders in all. What is the total cost for the 1200 stereos?a. $392,265b. $303,465c. $388,800d. $307,950
Business
1 answer:
VikaD [51]3 years ago
8 0

Answer:

a. $392, 265

Explanation:

Given that:

i. Purchasing department, overhead allocation rate is $77 per purchase order.

ii. Assembly department, overhead allocation rate is $5 per part.

iii. Packaging department, overhead allocation rate is $4 per unit.

iv. Direct material cost is $70 per unit.

v. Each stereo has 50 parts.

Total parts required = 1200 x 50

                                 = 60000

vi. 45 purchase order was required for 1200 stereos.

Thus:

i. $77 x 45 = $3465

ii. $5 x 60000 = $300000

iii. $4 x 1200 = $4800

iv. $70 x 1200 = $84000

Therefore,

total cost for 1200 stereos = $3465 + $300000 + $4800 + $84000

                                            = $392, 265

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Answer:

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Explanation:

There are two methods for estimating inventory costs:

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  2. Retail Method: It is used mostly by merchandising firms (retailers) that have consistent mark-ups. You have to determine the proportion between cost and retail price (lets say the COGS is 80% of the retail price). Then if you are given the retail inventory, you can determine the COGS using the proportion determined previously.

8 0
3 years ago
Your broker suggests that the stock of DUH is a good purchase at $25. You do an analysis of the firm, determining that the recen
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Answer:

The correct answer is "$28.03".

Explanation:

The given values are:

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= $1.40

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= 1.3

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Now,

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= 1.34\times 8

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hence,

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Absolutely, the proposal including its brokerage must be adopted because as fair market value was almost $25.

5 0
2 years ago
In 2021, the Westgate Construction Company entered into a contract to construct a road for Santa Clara County for $10,000,000. T
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Answer:

Explanation:

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Cost incurred in the year       2,016,000   2,808,000  2,613,600

Cumulative cost to date         2,016,000   4,824,000   7,437,000

Estimated cost to complete   5,184,000    2,376,000         0

Estimated total cost                7,200,000    7,200,000     7,437,000

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4,824,000/7,200,000*100 = 67%

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Percentage Completion                 28                 67              100

Contract price                           10,000,000

Less cumulative cost                 (7,437,000)

Gross profit                                 2,563,000

Contract value 2021  10,000,000* 28 %  =2,800,000

                          2022 10,000,000* 67%    = 6,700,000

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Profit recognized                        784,000          1,092,000      687,000

8 0
2 years ago
__________ is a market failure that the government might seek to change through intervention
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A market failure is one of the type of economical situation in which the  the various types of products and the services are distributions in an inefficient manner.

A positive externality, negative externality and an asymmetric information are the market failure that the government wants to change by the process of intervention

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In addition to the explicit fees of $50,000, we should also take into account the implicit cost incurred to Barnegat Light from the underpricing in the IPO. The underpricing is $10 per share, implying total costs of $1,000,000.

Calculation for What is the best estimate of the total cost to Barnegat Light of the equity issue-:

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Total cost = $50,000+$1,000,000

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Therefore the best estimate of the total cost to Barnegat Light of the equity issue will be $1,050,000.

Learn more about Initial Public Offering (IPO)on:

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5 0
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