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3 years ago

Periodic review systems are best suited for the C category of items under the ABC classification scheme.

Business

1 answer:

sveticcg [70]3 years ago

7 0

Answer:

a. True

Explanation:

ABC classification scheme refers to item analysis that is based upon the principle that there are many less critical items and few critical items by dividing on-hand inventory into three classes which is generally based upon annual dollar volume as follows:

"A items" have very tight control and accurate records

"B items" does not have a tight control and good records

"C items" have minimal records, periodic review, and and characterized by simple controls.

From the above explanation, it is therefore <u>true</u> that periodic review systems are best suited for the C category of items under the ABC classification scheme.

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Answer:

1. The cost of a hard drive installed in a computer. DIRECT MATERIAL COST.

The business of the company is to make computers so when it comes to hard drives, these are fundamental parts of a computer so they will be classified as direct materials since they are directly involved in the production process.

2. The cost of advertising in the Puget Sound Computer User newspaper. SELLING COST.

Advertising is done to be able to sell gods and services so it will fall under selling costs.

3. The wages of employees who assemble computers from components. DIRECT LABOR COST.

The labor cost of those that are involved in the direct manufacture of the computer will be considered direct labor as they are directly involved in the production process.

4. Sales commissions paid to the company’s salespeople. SELLING COST.

Sales commissions are paid to encourage the salespeople to sell more so this is a selling cost as it is incurred to increase sales.

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3 years ago

When an eyewitness to an auto accident is asked to describe what happened, which test of memory is being used?

AnnZ [28]

I would say that the test of memory for an eyewitness at an autombile accident would depend on visual memory akin to photographic memory to be able to recall the sequence of events that led to the accident and who hit who and who appeared to be a fault.

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3 years ago

The Midwest Division of Grainger Company has investment center average invested assets of $200,000 and investment center income

EleoNora [17]

The return on investment for this division is (B) 20%.

<h3>What is the return on investment (ROI)?</h3>

Return on investment (ROI) or return on costs (ROC) is a ratio of net income to investment over time (costs resulting from an investment of some resources at a point in time).
A high ROI indicates that the benefits of the investment outweigh the costs.
ROI is used as a performance indicator to evaluate the efficiency of an investment or to compare the efficiencies of several investments.
It is one method of connecting profits to capital invested in economic terms.

<h3>To find the return on investment for this division:</h3>

= income/average invested assets

= $40,000/$200,000

= return on investment

= 20%

Therefore, the return on investment for this division is (B) 20%.

Know more about return on investment here:

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Correct question:

The Midwest Division of Grainger Company has an investment center average invested assets of $200,000 and an investment center income of $40,000. What is the return on investment for this division?

(A) 500%

(B) 20%

(C) 25%

(D) 80%

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2 years ago

Murray Motor Company wants you to calculate its cost of common stock. During the next 12 months, the company expects to pay divi

Vlad1618 [11]

Answer:

a. Compute the cost of retained earnings (Ke)

$60 = $3 / (Ke - 8%)

Ke - 8% = $3 / $60 = 5%

Ke = 13%

b. If a $5 flotation cost is involved, compute the cost of new common stock (Kn).

$60 (1 - $5/$60) = $3 / (Kn - 8%)

$55 = $3 / (Kn - 8%)

Kn - 8% = $3 / $55 = 5.45%

Kn = 13.45%

Flotation costs reduce the amount of money that the company receives for every new stock that it issues, therefore, it increases the cost of new stocks.

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3 years ago

Pie Corporation paid $319,500 to acquire 90 percent ownership of Slice Company on April 1, 20X2. At that date, the fair value of

Brums [2.3K]

Answer and Explanation:

As per situation the Journal entries with narrations is here below:-

As per requirement of a

1. Slice Co. investment Dr, $319,500

To Cash $319,500

(Being cash paid is recorded)

2. Slice Co. investment Dr, $27,000

To Income from Slice Co. $27,000

(Being investment is recorded)

3 Cash Dr, $13,500

To Slice Co. investment $13,500

(Being cash is recorded)

As per requirement b

1. Sales Dr, $90,000

To Total Expenses $80,000

To Dividends Declared $5,000

To Retained Earnings $5,000

(Being sales is recorded)

2. Common stock Dr, $160,000

Additional paid-in capital Dr, $40,000

Retained earnings Dr, $155,000

Income from Slice Co. Dr, $27,000

NCI in NI of Slice Co. Dr, $3,000

To Dividends declared $15,000

($1,500 + $13,500)

To Investment in Slice Co. $333,000

($319,500 + $27,000 - $135,00)

To NCI in NA of Slice Co. $37,000

(Being acquisition is recorded)

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3 years ago