Answer:
High operating leverage means:
b. 2. The company has relatively high fixed costs.
d. 4. The company will have to sell fewer units than a comparable company with low operating leverage to break even.
Explanation:
High operating leverage implies that the entity has high gross margin and only needs to sell fewer units to break-even. When a company has a high operating leverage, it makes a large additional income from just selling a unit of its product. The variable cost per unit is usually low for such a company, though the fixed costs are relatively high.
Answer:
credit to Work in Process of $59,000.
Explanation:
Based on the information given the appropriate l journal entries to record these transactions would include a: CREDIT TO WORK IN PROCESS OF $59,000
Dr Finished goods $59,000
Cr Work in process $59,000
Dr Cost of goods sold $65,000
Cr Finished goods $65,000
Answer:
See below
Explanation:
First, we need to get the predetermined rate
Predetermined rate = Cost of manufacturing overhead / Cost driver
= $1,800,000/60,000
= $30
We will now calculate the application.
Actual labor hours × rate
= 61,500 × $30
= $1,845,000
We will now compare actual with overhead cost
= Applied Overhead cost - Actual manufacturing overhead
= $1,845,000 - $1,810,000
= $35,000
The above is an over application of overhead cost because the cost applied exceed the actual cost.
the price of summer cabins. as summer approaches, the equilibrium price of rental cabins increases, and the equilibrium quantity of cabins rented increases increase in demand.
When the price falls below the equilibrium price, the quantity demanded exceeds the quantity supplied, creating an excess demand (short supply) for the product. In other words, consumers want to buy more than producers are willing to sell. This mismatch between supply and demand drives up prices.
Price movements cause equilibrium movement along the supply curve. Such a movement is called a change in supply. Like changes in demand, changes in supply do not shift the supply curve. By definition, it is moved along the supply curve.
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A. captive-product pricing
Gillette charges a fairly low price for their razors (relative to costs) and a high price for razor blades. they are using a strategy of __________ pricing.
