Answer:
Both divisions have negative residual income,but the performance of West Division is preferred
Explanation:
Residual income is the word used in describing the remnant of profit after cost of doing business(cost of capital) has been deducted from net income.
The formula is stated thus:
residual income=net income-(cost of capital*investment)
For East Division,residual income is computed as follows:
Net income is $270,000
Investment is $1,900,000
cost of capital is 25%
residual income=$270,000-($1,900,000*25%)=-$205,000
For West Division,residual income is computed as follows:
Net income is $450,000
Investment is $2,400,000
cost of capital is 25%
residual income=$450,000-($2,400,000*25%)=-$150000
<h2>PRINCIPAL OF INCOME TAXATION </h2>
The benefit principle of taxation is based on two ideas. The first and foremost is that those who benefit from services should be the ones who pay for them. Secondly, people should pay taxes in proportion to the amount of services or benefits they receive.
Explanation:
HOPE IT HELP U MAKE
Answer: This means: "d. Your economic profit has gone down and your accounting profit has stayed the same."
Explanation: The difference between the accounting and economic benefit is associated with the type of cost that each includes:
The accounting benefit is nothing more than the difference between income and cost. In this case it is still $50000.
The economic benefit includes not only explicit costs. The economic benefit is the difference between income and total costs (explicit and implicit). Therefore, this benefit is less than the accounting benefit. Because in this case the cost of working at home is considered.
Answer:
Results are below.
Explanation:
<u>To calculate the predetermined overhead rate, we need to use the following formula on each department:</u>
<u></u>
Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
<u>Department D:</u>
Predetermined manufacturing overhead rate= 1,197,000 / 1,496,250
Predetermined manufacturing overhead rate= $0.8 per direct labor dollar
<u>Department E:</u>
Predetermined manufacturing overhead rate= 1,500,000 / 125,000
Predetermined manufacturing overhead rate= $12 per direct labor hour
<u>Department K:</u>
Predetermined manufacturing overhead rate= 720,000 / 120,000
Predetermined manufacturing overhead rate= $6 per machine hour
I think the answer is false because many schools raise fundraisers to help pay for things. If this is the case the money for the school will be quite low
