Answer:
The amount of cost from Pool A that is allocated to LQ6 is $7,802.
Explanation:
Since Pool A includes all variable overhead and uses direct labor as the allocation base, we can obtain the following from the question:
Direct labor = $82,056
Variable overhead = $146,362
Number of labor hours used by LQ6 = 162
Factory's labor costs per hour = $27
Therefore, we have:
Factory's labor cost of LQ6 = Number of labor hours used by LQ6 * Factory's labor costs per hour = 162 * $27 = $4,374
Variable over allocated to LQ6 from Pool A = (Factory's labor cost of LQ6 / Direct labor) * Variable overhead = ($4,374 / $82,056) * $146,362 = $7,801.83518572682
Rounding to whole number of $ as required, we have:
Variable over allocated to LQ6 from Pool A = $7,802
Therefore, the amount of cost from Pool A that is allocated to LQ6 is $7,802.
Answer:
A) Profitability index.
Explanation:
Based on the scenario being it can be said that the most appropriate tool to use in this specific situation would be a Profitability index. This is a ratio that weighs the payoff to the investment of a specific project. It is allows individuals to rank projects on the amount of value that they will be getting from them. Thus allowing you to choose the most optimal projects in situations such as this one.
Answer:
A. population sizes, income levels and cultural influences, the current state of the infrastructure and distribution and retail networks available.
Explanation:
The reason is that the foreign markets are affected by the cultural differences for example if US clothing brand enters Suadia Arabia then it can not sell its brands here because in the Suadia Arabian culture girls wear full sleeves and are not skin tight fits. This means that the culture have an influence over the foreign markets. Likewise the income level tells about how much the customer can spend on luxury items, population of customers available is also an attractive part that the investors see to move in the markets. The infrastructure of a country and the regional importance of the state are also the motivators for the foreign companies to move in to the market.
These factors are the ecosystem of the country that gives insight of the market size and market growth of a particular market.
Answer:
future worth:
project A 11,615.26
project B 12,139.18
It should choose project B as their future value is greater
IRR of project A: 13.54%
We should remember that the IRR is the rate at which the net value is zero thus, equals the inflow with the cash outlay
It is calculate with excel or financial calculator due to the complex of the formula.
Explanation:
Project A
We calculate the future value of the cash flow per year and cost as we are asked for future value. The salvage value is already at the end of the project life so we don't adjust it.
Revenues future value
C 15,000
time 8
rate 0.12
FV $184,495.3970
Expenses future value
C 3,000
time 10
rate 0.12
FV $52,646.2052
Cost future value
Principal 40,000.00
time 10.00
rate 0.12000
Amount 124,233.93
Net future worth:
-124,233.93 cost - 52,646.21 expenses + 184,495.40 revenues + 4,000 salvage value
future worth 11,615.26
Project B
cost:
Principal 60,000.00
time 10.00
rate 0.12000
Amount 186,350.89
expenses 52,646.21 (same as previous)
revenues
C 24,000
time 7
rate 0.12
FV $242,136.2815
TOTAL
242,136.28 + 9,000 - 52,646.21 - 186,350.89 = 12,139.18
Internal rate of return of project A
we write the time and cash flow for each period.
Time Cash flow
0 -40,000
1 -3,000
2 -3,000
3 12,000
4 12,000
5 12,000
6 12,000
7 12,000
8 12,000
9 12,000
10 16,000
IRR 13.54%
Then we write on excel the function =IRR(select the cashflow)
and we got the IRR of the project
