When negative externalities are present in a market

Cost standards for one unit of product no. C77: Direct material 3 pounds at $2.50 per pound $ 7.50 Direct labor 5 hours at $7.50

xxMikexx [17]

Answer:

Usage variance=$750

Explanation:

<em>A material usage variance occurs when the standard quantity required to active a particular level of production is higher or lower than than the actual actual quantity used. A favorable variance would mean than less quantity of materials were used than the standard to achieve a given output level. And an adverse variance would mean the opposite </em>

<em> Pounds</em>

7,800 units should have used ( 7,800× 3) 23,400

but did use <u>23,100</u>

Usage variance 300

× standard price <u>$2.50</u><u> </u>

Usage variance <u> $750</u> favorable

Usage variance =$750

7 0

3 years ago

Rose Hill Trading Company is expected to have EPS in the upcoming year of $6. The expected ROE is 18%. An appropriate required r

Nesterboy [21]

Answer:

We know the company's ROE and plowback ratio, and we can use these 2 figures to find out the future growth rate of the company. In order to do this we need to multiply the ROE by plowback ratio.

0.18*0.7=0.126= 12.6%

We can also find the company's dividend, by (1- plowback ratio) we get how much percentage of the earning is the company distributing as dividends.

(1-0.7)= 0.3 which is the dividend payout ratio

Dividend= Dividend payout ratio *EPS

0.3*6=1.8

This dividend is the dividend which the company will pay in the upcoming year after which they will have a constant growth rate, so in order to find the intrinisc value now, we need to find the intrinsic value of the stock will be in the upcoming year using the upcoming years dividend and then discount that value by the required return of the stock to get the current years intrinsic value.

Now we can use the DDM formula to find the intrinsic value of the stock in the upcoming year.

The formula for DDM is D*(1+G)/(R-G)

D= 1.8

G= 0.126

R=0.14

1.8*(1+G)/0.14-0.126

=144.77

Discount it to find the present value

144.77/1.14

=128.5

The intrinsic value of the stock should be 128.5

Explanation:

7 0

3 years ago

A company reported beginning inventory of 100 units at a per unit cost of $25. It had the following purchase and sales transacti

patriot [66]

Answer:

14-Jan

Dr Trade Receivable $1,125

Cr Sales

14-jan

Dr Cost of sales 625

Cr Inventory 625

9-Apr

Dr Inventory 375

Cr Trade Payable 375

2-Sep

Dr Trade Receivable $2,500

Cr Sales $2,500

2 sep

Dr Cost of sales $1,375

Cr Inventory $1,375

Dec 31 No journal entry

Explanation:

Preparation to Records the month-end journal entries noted below, assuming the company uses a periodic inventory system

14-Jan

Dr Trade Receivable $1,125

Cr Sales (45*25)

14-jan

Dr Cost of sales[25*25] 625

Cr Inventory 625

9-Apr

Dr Inventory (25*$15) 375

Cr Trade Payable 375

2-Sep

Dr Trade Receivable $2,500

Cr Sales (50*50) $2,500

2 Sep

Dr Cost of sales $1,375

Cr Inventory $1,375

($2,500-$1,125)

Dec 31 No journal entry

8 0

3 years ago

Vandelay Industries is considering the purchase of a new machine for the production of

Colt1911 [192]

The Equivalent annual cost for the Machine A and B is $5,083,947.72 and $5,461,499.68 respectively,

<h3>What is an Equivalent annual cost?</h3>

In accounting, this refers to the annual cost of owning, operating, and maintaining an asset over its entire life.

<h3>Machine A:</h3>

Cost of Machine = $3,210,000

Useful Life = 6 years

Annual Depreciation = Cost of Machine / Useful Life

Annual Depreciation = $3,210,000 / 6

Annual Depreciation = $535,000

Annual OCF = [Sales - Variable Costs - Fixed Costs] * (1 - tax)+ tax * Depreciation

Annual OCF = [$12,400,000 - 37% * $12,400,000 - $350,000] * (1 -0.24) + 0.24 * $535,000

Annual OCF = $7,462,000 * 0.76 + 0.24 * $535,000

Annual OCF = $5,799,520

NPV = -$3,210,000 + $5,799,520 * PVIFA(9%, 6)

NPV = -$3,210,000 + $5,799,520 * 4.48592

NPV = $22,806,182.76

EAC = NPV / PVIFA(9%, 6)

EAC = $22,806,182.76 / 4.48592

EAC = $5,083,947.72

<h3>Machine B:</h3>

Cost of Machine = $5,455,000

Useful Life = 9 years

Annual Depreciation = Cost of Machine / Useful Life

Annual Depreciation = $5,455,000 / 9

Annual Depreciation = $606,111.11

Annual OCF = [Sales - Variable Costs - Fixed Costs] * (1 - tax)+ tax * Depreciation

Annual OCF = [$12,400,000 - 32% * $12,400,000 - $240,000] * (1 -0.24) + 0.24 * $606,111.11

Annual OCF = $8,192,000 * 0.76 + 0.24 * $606,111.11

Annual OCF = $6,371,386.67

NPV = -$5,455,000 + $6,371,386.67 * PVIFA(9%, 9)

NPV = -$5,455,000 + $6,371,386.67 * 5.99525

NPV = $32,743,055.93

EAC = NPV / PVIFA(9%, 9)

EAC = $32,743,055.93 / 5.99525

EAC = $5,461,499.68

Read more about Equivalent annual cost

<em>brainly.com/question/14777504</em>

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5 0

2 years ago

Although _________ tend to have high predictive validity in many types of jobs, their usage in employee selection is controversi

goldenfox [79]

Answer:

Cognitive ability test

Explanation:

Cognitive ability test are test used in measuring applicants cognitive function in specific areas. Areas may include verbal reasoning, numerical reasoning, quantitative reasoning, spatial reasoning and so on. They are aptitude test used in predicting the the applicant future aptitude position. It is a method employed by many corporations in non applicant selection. However, the cognitive test has been shown to always results in lower selection of minorities both racial and ethnicity wise.

7 0

3 years ago