Answer:
Considering the allocate fixed cost, it would not be a good option.
It will generate a financial disadvantage of 22,950
Explanation:
![\left[\begin{array}{cccc}&produce&buy&Differential\\Purchase&&282,600&-282,600\\Variable Cost&270,000&&270,000\\Fixed Cost&68,400&32,850&-35,550\\Total Cost&338,400&315,450&-22,950\\\end{array}\right]](https://tex.z-dn.net/?f=%5Cleft%5B%5Cbegin%7Barray%7D%7Bcccc%7D%26produce%26buy%26Differential%5C%5CPurchase%26%26282%2C600%26-282%2C600%5C%5CVariable%20Cost%26270%2C000%26%26270%2C000%5C%5CFixed%20Cost%2668%2C400%2632%2C850%26-35%2C550%5C%5CTotal%20Cost%26338%2C400%26315%2C450%26-22%2C950%5C%5C%5Cend%7Barray%7D%5Cright%5D)
Fixed overhead; 38 x 1800 = 68,400
There is a portion of 35,550 fixed cost which is tracable to the real wheel assembly line thus, will be eliminated.
But 32,850 would not.
Considering this, it would not be a good option to stop the assembly line and purchase the component
Answer:
The Net cash is 436.000
Explanation:
To get net cash flow using the indirect method we must make adjustments to the net income.
It depends on the account if it is added or subtracted to net income
In this case,
Net income 400.000
Adjustment to reconcile the net income to cash
- Accounts receivable increase (40.000)
+ Depreciation expense 80.000
+ Prepaid expenses decrease 12.000
- Gain on sale of machinery (20.000)
+ Accounts payable increase 6.000
- Wages payable decrease (2.000)
Net cash 436.000
The correct answer is choice b, incompatible duties.
There are three primary reasons why people commit fraudulent activity, which is represented in the Fraud Triangle. The three primary factors that lead to fraud are opportunity, financial pressure and rationalization.
