The currency would deflate, though this never happens
Answer:
$84 unfavorable
Explanation:
The computation of the activity variance for supplies cost is shown below:
Supplies cost for the standard one is
= $1,840 + (624 frames × $12 per frame)
= $9,328
And, the supplies cost for the actual one is
= $1,840 + (631 frames × $12)
= $9,412
So the activity variance is
= $9,328 - $9,412
= $84 unfavorable
As the standard cost is less than the actual one
Answer:
Dr. Inventory Write down............(91,000 - 71,600)....$19,400
Cr. Inventory.......................................................................................$19,400
Explanation:
The write down of the inventory value from at the end of the year with a historical cost of $ 91,000 to the current replacement cost is $ 71,600 will be recorded as follows:
<u>Journal Entries</u>
Dr. Inventory Write down............(91,000 - 71,600)....$19,400
Cr. Inventory.......................................................................................$19,400
<u>Being the write down of the value of inventory from historical cost to replacement cost at year end</u>
Answer:
The company's turnover rounded to the nearest tenth: C) 9.5
Explanation:
Asset turnover helps investors understand how effectively companies are using their assets to generate sales. Asset turnover is calculated by using following formula:
Asset Turnover = Total Sales or Revenue/ Average Total Assets
where:
Average Total Assets = (Beginning Assets + Ending Assets )/2 = (Assets at the beginning of year +Assets at end of year )/2
In the House of Orange:
Average Total Assets = ($84,000 + $90,000)/2 = $87,000
Asset Turnover = $826,650/$87,000 = 9.5
