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Orlov [11]
3 years ago
8

Your supervisor has come to you with the following list of expenditures for the year and is asking you whether they should be ca

pitalized or expensed as repairs and maintenance. Indicate all of the expenditures that would most appropriately be capitalized.
1. Re-painted the office building.
2. Added a new wing onto the office building.
3. Took their fleet of cars in for servicing (changing the oil, etc.).
4. Added newer electronic locks on the doors in the production building.
5. Had an engine rebuilt in one of their fleet cars.
Business
1 answer:
Trava [24]3 years ago
6 0

Answer:

Capitalized Expenditures:

2. Added a new wing onto the office building.

5. Had an engine rebuilt in one of their fleet cars.

Explanation:

Capitalization is the process of delaying the full recognition of an expense for the acquisition of a new asset with long-term life so that the costs can be treated as an expense gradually over its useful life through an accounting method known as depreciation or amortization.

The criteria for capitalizing expenditure depend on whether the expenditure is necessary to bring the asset to the condition and location where it can be operated as desired by the management.  It must also meet the threshold amount set by management for capitalization.  This is because some assets can be used for more than one year and still they are not regarded as capital assets.  Example is a stapling machine that costs less than a dollar.

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TB MC Qu. 7-77 Corbel Corporation has two divisions: Division A and ... Corbel Corporation has two divisions: Division A and Div
irina1246 [14]

Answer:

Corbel Corporation's common fixed cost  is $41,650

Explanation:

Division A contribution margin       $47,700

Division B contribution Margin       <u>$80,850</u>           $128,550

($231,000 * 35%)

Less: Traceable fixed cost              $59,700

Operating Income                           <u>$27,200</u>           <u>($86,900)</u>

Common fixed cost                                                   <u>$41,650</u>

3 0
3 years ago
The annual demand for a product is 15,300 units. The weekly demand is 294 units with a standard deviation of 90 units. The cost
antiseptic1488 [7]

Answer:

Reorder point = (weekly demand * lead time) + (Z * standard deviation * √lead time) = (294 * 10) + (2.326 * 90 * √10) = 2,940 + 661.99 = 3,602 units

Old safety stock = Z * standard deviation * √lead time = 662 units

new safety stock = 331

331 = Z * 90 * √10

Z = 331 / 284.60 = 1.163

Using Normal distribution function, the new confidence interval is 87.76%

3 0
3 years ago
Roxanne has developed a new adult milk beverage that is enhanced with vitamins. there has never been a product like this before
KIM [24]
For the answer to the question above, I think that
Roxanne is likely to use the <u><em>"Test market"</em></u> <span>method to forecast demand. </span>
I hope my answer helped you. Have a nice day!
8 0
3 years ago
An investor owned a 100-acre parcel that contained several natural asphalt lakes. A construction company was erecting highways f
Leona [35]

Answer: Yes

Explanation:

The construction company is entitled to compensation because it has a property right to enter and remove minerals.

The investor gave the construction company the right to use the properties on the land, if anything would be done on the land, the construction company should be compensated because they bought the right to do business there. Since the owner granted them the sole right, they are entitled to the resources.

7 0
3 years ago
MCO Leather Goods manufactures leather purses. Each purse requires 2 pounds of direct materials at a cost of $4 per pound and 0.
ruslelena [56]

Answer:

Direct Materials Purchases Budget Sept 51680  October  60160              

Direct labor Budget September 54600 October  66150

Overhead Budget Sept  $ 20920  October  $23,230

Explanation:

The budgets are calculated in the following ways.

We multiply the required material , direct labor hour or variable overhead rate with the given number of units and then with the cost per unit to get the total costs.

MCO Leather Goods Manufacturers

Direct Materials

<u>Purchases Budget</u>

                              September      October      November

Production              5200             6300             6100

<u>Pounds per units       *  2                 *2                    *2</u>

<u>Total Pounds           10400           12600           12200</u>

Cost per pound         * $4               * $4                   *$4

<u>Total cost                41600           50400           48800 </u>

On hand

<u>Inventory               + 10080             + 9760                 ---     </u>

Direct Materials

<u>Purchases Budget  51680           60160                     </u>

<u></u>

MCO Leather Goods Manufacturers

Direct Labor Budget

                                       September           October

Production                        5200                   6300

<u>Hours required per unit * 0.7                          *0.7</u>

Total hours                      3640                      4410

<u>Rate per hour                 * $15                           *$15</u>

<u>Total labor Cost            54600                   66150</u>

 

MCO Leather Goods Manufacturers

Factory Overhead Budget

                                       September           October

Production                        5200                   6300

<u>Hours required per unit * 0.7                         * 0.7</u>

Labor Hours                      3640                  4410

<u>Variable OH                      * $3                     *$3        </u>

<u>Variable Costs                 $10920             $13230</u>

<u>Fixed OH                        + $10,000             +$10,000</u>

<u>Total OH                          $ 20920             $23,230</u>

8 0
3 years ago
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