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steposvetlana [31]
3 years ago
7

As the operations manager, you prefer to keep a constant workforce and production level, absorbing variations in demand through

inventory excesses and shortages. Demand not met is carried over to the following month. Assuming you currently have 23 workers, what is the shortage cost for May
Business
1 answer:
podryga [215]3 years ago
4 0

Answer:

Shortage cost for May is $71,000

Explanation:

The expected demand for the month of May is 5000 units.

Shortages for month are carried to next month.

Shortage cost is $10 per month.

(Working days per month x hrs/day x # of workers)

20 days * 8 hours * 23 workers = 3680

Jan :  3680 - 3500 = +180

Feb : 3680 + 180 - 4500 = -640

Mar : 3680 - 640 -6000  = -2980

Apr : 3680 - 2980 -6500 = 5780

May : 3680 - 5780 -5000 = 7100

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The following data were taken from the records of Menendez Company:
nydimaria [60]

Answer: a. $1,500

Explanation:

Working capital is calculated by deducting current liabilities from current assets. It is meant to show the operating liquidity of a company within a period.

Working capital = Current assets - Current liabilities

= 5,000 - 3,500

= $1,500

3 0
2 years ago
Each of the following situations occurred during 2011 for one of your audit clients:1. The write-off of inventory due to obsoles
In-s [12.5K]

Answer:

Situations during 2011 at an Audit Client

A. Appropriate Reporting Treatments:

1. Write-off of inventory due to obsolescence.

a. As an extraordinary item.

2. Discovery that depreciation expenses were omitted by accident from 2010's income statement.

c. As a prior period adjustment.

3. The useful lives of all machinery were changed from eight to five years.

f. As a change in accounting estimate.

4. The depreciation method used for all equipment was changed from the declining-balance to the straight-line method.

g. As a change in accounting estimate achieved by a change in accounting principle.

5. Ten million dollars face value of bonds payable were repurchased (paid off) prior to maturity resulting in a material loss of $500,000. The company considers the event unusual and infrequent.

b. As an unusual or infrequent gain or loss.

6. Restructuring costs were incurred.

b. As an unusual or infrequent gain or loss.

7. The Stridewell Company, a manufacturer of shoes, sold all of its retail outlets. It will continue to manufacture and sell its shoes to other retailers. A loss was incurred in the disposition of the retail stores. The retail stores are considered components of the entity.

e. As a discontinued operation.

8. The inventory costing method was changed from FIFO to average cost.

d. As a change in accounting principle.

B. Inclusion in the Income Statement:

1. CO

2. RE

3. CO

4. RE

5. BC

6. BC

7. BC

8. CO

Explanation:

1. Investopedia.com defined "Unusual or infrequent items" as "gains or losses from a lawsuit; losses or slowdown of operations due to natural disasters; restructuring costs; gains or losses from the sale of assets; costs associated with acquiring another business; losses from the early retirement of debt; and plant shutdown costs."

2. Extraordinary gains or losses are economic events which originate from continuing infrequent and unusual operations.  These gains and losses stem from the normal business activities of the company, but, they do not happen regularly, and are abnormal in nature.

3. A prior period adjustment is the correction of a past accounting error that occurred in the past financial statements.

4. According to investopedia.com, "A change in accounting principle is a change in how financial information is calculated, while a change in accounting estimate is a change in the actual financial information.  Changes in accounting principles are done retroactively, where financial statements have to be re-stated.  But, changes in estimates are not applied retroactively.

6 0
3 years ago
1-Started business with Cash OMR 100000
quester [9]
Finger enter me . Named asnumber 8
8 0
2 years ago
Troy Enterprises uses a continuous review inventory control system. The firm operates 50 weeks per year, with an annual demand o
timurjin [86]

Answer:

Safety Stock is 336.62 units

Explanation:

As per given data

Demand = D = 50,000

Ordering Cost = S = $35

Holding Cost = H = $1 per unit per year

Weekly Demand = Demand / 50 weeks = 50,000 / 50 = 1,000 units per week

Weekly Demand during Lead time of 3 weeks = 1000 x 3 = 3,000 units

Standard Deviation = 216.51 units

Desired Service level = 94%

The Z score at 94% service level is 1.55477  

Safety Stock = Zscore x standard deviation = 1.55477 x 216.51

Safety Stock = 336.62

8 0
3 years ago
Phoenix Agency leases office space for $7,000 per month. On January 3, Phoenix incurs $65,000 to improve the leased office space
Daniel [21]

Answer:

correct option is $13,000

Explanation:

given data

leases office = $7,000 per month

Phoenix incurs = $65,000

yield benefits = 8 years

remaining on its lease = 5 years

solution

we know that The cost of leasehold improvement is depreciate whichever is less    

(a)  Remaining Lease Term      

(b) estimated useful life of improvement

so Annual depreciation of Leasehold Improvement will be here

Annual depreciation of Leasehold Improvement = \frac{65000}{5}

Annual depreciation of Leasehold Improvement = $13,000

so correct option is $13,000

4 0
3 years ago
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