Answer:
1. $2.60
2. 4 pounds
3. $10.40
Explanation:
Given that,
Price per pound of raw materials = $2.30
Freight-in = $0.20
Receiving and handling = $0.10
Quantity per gallon of the finished product—required materials = 3.60 pounds
Allowance for waste and spoilage = 0.40 pounds
1. Standard materials price per gallon:
= Price per pound of raw materials + Freight-in + Receiving and handling
= $2.30 + $0.20 + $0.10
= $2.60
2. Standard materials quantity per gallon:
= Quantity required materials + Allowance for waste and spoilage
= 3.60 pounds + 0.40 pounds
= 4 pounds
3. Standard materials cost per gallon:
= Standard materials price per gallon × Standard materials quantity per gallon
= $2.60 × 4
= $10.40
Answer:
Will the financial statements of a company always differ when different choices at the start of the accounting period are made regarding the denominator-level capacity concept?
A. No. It depends on how a company handles the production-volume variance in the end-of-period financial statements. For example, if the adjusted allocation-rate approach is used, each denominator-level capacity concept will give the same financial statement numbers at year-end.
Explanation:
Level capacity strategy
The organisation manufactures or produces at a constant rate of output ignoring any changes or fluctuations in customer demand levels. This often means stockpiling or higher holdings of inventory when customer demand levels fall
B. because it is only used by the military and not the public
- The greater the elasticity of supply, the grater the gains from trade.
<u>TRUE. </u>
This situation is true because in an elastic supply situation there is a decrease in prices and an increase in demand, so total surpluses increase and generate more gains to trade.
- If supply is perfectly inelastic, the fall in consumer surplus would exceed the rise in producer surplus.
<u>FALSE</u>
It is false because In a perfectly inelastic supply situation, the quantity of demand does not change even if prices change.
- Producers can still benefit from trade even if supply is perfectly inelastic.
<u>FALSE</u>
It is false because in a perfectly inelastic supply situation the beneficiary will be the consumer, as prices will not change and consumer surplus will increase.
