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jeka57 [31]
3 years ago
14

A company uses the departmental overhead rate method. Total overhead costs are $5,000,000. Of this total, the machining departme

nt is assigned overhead costs of $4,000,000 and the assembly department is allocated the remainder. The machining department uses machine hours as their allocation base and has 80,000 machine hours. The assembly department uses direct labor hours as their allocation base and has 50,000 direct labor hours. Calculate the overhead rate for the machining department. Multiple choice question. $62.50 per machine hour $50.00 per machine hour $20.00 per direct labor hour $100.00 per direct labor hour
Business
1 answer:
AleksAgata [21]3 years ago
4 0

Answer:

Allocation rate Machining= $50 per machine hour

Explanation:

Giving the following information:

Estimated Machining cost= $4,000,000

Estimated Number of machine hours= 80,000

<u>To calculate the allocation rate for the Machining department, we need to use the following formula:</u>

Allocation rate Machining= total estimated costs for the period/ total amount of allocation base

Allocation rate Machining= 4,000,000 / 80,000

Allocation rate Machining= $50 per machine hour

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If a firm decides to increase the depth of its offerings to address consumer preferences, what will it do
Shtirlitz [24]

Answer: consumers find it unfair for firms to increase prices after an increase in demand".

Explanation: Economists established 2 explanations of why companies do not increase their prices even if they can make higher profits.

First it was discovered that some products have the characteristic that the amount of product that a customer wants to buy can depend on the amount of the product that other people are consuming.

And then it was discovered that most people are satisfied that companies raise prices because of an increase in costs, but consider it unfair to raise prices as a result of increased demand.

Explanation:

7 0
2 years ago
The Internal Rate of Return (IRR) represents which of the following: Multiple Choice The discount rate that must be lower than t
zmey [24]

Answer:

The discount rate that makes the net present value equal to zero.

Explanation:

The internal rate of return is the discount rate that equates the after tax cash flows from an investment to the amount invested.

It is the discount rate that makes the net present value equal to zero.

I hope my answer helps you

8 0
3 years ago
The last dividend paid by Wilden Corporation was $1.55. The dividend growth rate is expected to be constant at 1.5% for 2 years,
shtirl [24]

Answer:

e)  $37.05

Explanation:

Using the dividend growth model, the value of a stock is the present value of the future dividends receivable discounted at the required rate of return . The required rate of return is given as 12%.

So we discount the year 3 dividend using the dividend growth model formula

P = D (1+g)/r-g

r- rate of return, g = growth rate

Present value of the future dividends:

PV of Year 1 = 1.55(1.015)m × 1.12^(-1)

                     = 1.4047

PV of Year 2 = 1.55 (1.015)(1.015) × 1.12^(-2)

                     =  1.27

PV of Year 3 (this will be done in two steps)

Step 1; PV (in yr 2) of year 3 dividend

= (1.55)(1.015)^2×(1.08)/(0.12-0.08)

=43.114

Step 2 : PV (in yr 2) of year 3 dividend

  =43.114 × (1.12^(-2))

   = 34.37

Best estimate of stock = 1.40 + 1.27 +34.37

                                       = $37.05

Note

To discount the year 3 dividend, we use two steps. The first stp helps get the PV in year 2, and step 3 helps to take it further to the PV in year 0

         

8 0
3 years ago
Valotic Tech Inc. sells electronics over the Internet. The Consumer Products Division is organized as a cost center. The budget
Tcecarenko [31]

Answer:

<u>Total Over budget = $112370</u>

<u>Total Under Budget= $ 56062</u>

Explanation:

<u>Valotic Tech Inc.</u>

<u>Budget Performance Report—Director, Consumer Products Division</u>

<u>For the Month Ended January 31, 2016</u>

                                                 Budget          Actual       (Over) Under Budget

Customer service salaries   $546,840     $602,350         (55,510)

Insurance & property taxes    114,660        110,240             4420

Distribution salaries               872,340         861,200           11,140

Marketing salaries               1,028,370       1,085,230          (56,860)

Engineer salaries                 836,850          820,008         16842

Warehouse wages                586,110          562,632          23478

<u>Equipment depreciation        183,792        183,610                182              </u>

<u> Total                                  $4,168,962      $4,225,270        (56308)       </u>

<u />

<u>Total Over budget = $112370</u>

<u>Total Under Budget= $ 56062</u>

Over budget means that the amount is spent more than the amount budgeted.

The Customer service salaries and  Marketing salaries are over budgeted and the the director is expected to request supplemental reports of these to analyze where the amount has been overspent.

4 0
3 years ago
Assume that Roth’s accountants are expected to work a total of 8,000 direct labor hours in 2018. Roth’s estimated total indirect
xz_007 [3.2K]

Answer:

$12 and $180

Explanation:

The computation of the predetermined overhead rate is shown below:

As we know that

The predetermined overhead rate is

= Estimated total indirect cost  ÷ expected direct labor hours

= $96,000 ÷ 8,000

= $12

And, the indirect cost is

= Predetermined overhead rate × number of hours

= $12 × 15

= $180

We simply applied the above formula

8 0
3 years ago
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