Answer:
The control has been implemented but is not operating effectively.
Explanation:
Budgetary control in finance can be regarded as the management of income as well as expenditure. It involves comparison of actual income/ expenditure with the planned income/ expenditure on regular basis so that it will be easier to know if there is need for corrective action. It should be noted that if a budgetary reporting system provides adequate reports, but the reports are not analyzed and acted upon, then there is implementation of control already but there is no effective operation.
Explanation:
The computation of the fixed cost and the variable cost per hour by using high low method is shown below:
Variable cost per mile = (High Operating cost - low operating cost) ÷ (High miles - low miles)
= ($845 - $625) ÷ (3,350 miles - 2,250 miles)
= $220 ÷ 1,100 miles
= $0.2 per miles
Now the fixed cost equal to
= High operating cost - (High miles × Variable cost per miles)
= $845 - (3,350 miles × $0.2 per miles)
= $845 - $670
= $175
And, the contribution margin income statement is presented below:
Sales (1,400 × $0.6) $840
Less: Variable cost (1,400 × $0.2) ($280)
Contribution margin $560
Less: Fixed cost ($175)
Net operating income $385
Answer:
174,250 shares
Explanation:
The computation of the number of shares to be used in computing diluted earnings per share is shown below:
Proceeds from exercise of options (a) $369,000 (41,000 shares × $9)
Used to repurchased for common stock (b) 30,750 shares (41,000 shares × $9 ÷ $12)
Number of shares for exercised (c) 41,000 shares
Less: repurchased shares (d) -30,750 shares
Diluted common shares {e = c - d} 10,250 shares
Add: Common shares (f) 164,000 shares
Total number of shares for diluted earning per share 174,250 shares
We ignored the market price of common stock as it is not relevant.
