Answer:
If we assume that the company does not have any required rate of return or discount rate associated to the lease payments, then the company should lease the equipment because the differential revenue will be higher ($214,200 ˃ $207,000).
Explanation:
the differential revenue if the equipment is leased:
total lease payments - associated costs = $290,000 - $75,800 = $214,200
the differential revenue if the equipment is sold:
selling price - sales commission = $230,000 - $23,000 = $207,000
If we assume that the company does not have any required rate of return or discount rate associated to the lease payments, then the company should lease the equipment because the differential revenue will be higher. The problem is that in the real world this never happens since the company should discount the lease payments since one dollar today is worth more than one dollar tomorrow. Since we are not given any discount rate, we must assume it is 0.
Answer:
$21,177 overapplied
Explanation:
Applied Overheads = Predetermined overhead rate x Actual activity
where,
Predetermined overhead rate = Budgeted Overheads ÷ Budgeted Activity
= $485,060 ÷ 48,506 hours
= $10 / direct labor hour
therefore,
Applied Overheads = $10 x 52,943 = $529,430
Since, Applied Overheads ($529,430) > Actual Overheads ($508,253), overheads have been over-applied by $21,177
Conclusion :
The amount of overapplied manufacturing overhead at the end of the year is $21,177
Answer:
The discount is for $86
It will be available until May 16th
Explanation:
the credit terms are 1/15, net 45
the first numebr is the discount amount, 1%
the second number is the days after billing this discount option is active, 15
net 45 means the customer can pay the nominal 8,600 within a 45 days period. After that it should renegociate the bill
The discount will be 8,600 x 1% = 8,600 x 0.01 = 86
It will be available up to 15 days after billing:
May 1st + 15 days = May 16th
