#2- Almost all economic systems today are ?

The following cost data relate to the manufacturing activities of Chang Company during the just completed year Manufacturing ove

zimovet [89]

Answer and Explanation:

The computation of the amount of underapplied or overapplied overhead cost is shown below:-

Overapplied overhead cost = Actual Manufacturing overhead costs - Manufacturing overhead applied

= $473,000 - (19,400 × $25)

= $473,000 - $485,000

= $12,000

2. The Preparation of cost of goods manufactured for the year is shown below:-

Chang Company

Cost of goods manufactured

Direct materials:

Raw materials inventory, beginning $20,000

Add: Purchases of raw materials $400,000

Raw materials available for use $420,000

Less: Raw materials inventory, ending $30,000

Raw materials used in production $390,000

Less: Indirect materials $15,000 $375,000

Direct labor $60,000

Manufacturing overhead cost

applied to work in process $485,000

Total manufacturing costs $920,000

Add: Work in process inventory, beginning $40,000

Less: Work in process inventory, ending $70,000

Cost of goods manufactured $890,000

3 0

3 years ago

You and your partner have become very interested in cross-country motorcycle racing and wish to purchase entry-level equipment.

Lana71 [14]

Answer:

Package K offers the lower present worth analysis.

Explanation:

This can be determined using the following 3 steps.

Step 1: Calculations of present worth of Package K

First cost = $200,000

Present value of quarterly operating cost = quarterly operating cost * ((1- (1/(1 + r))^n)/r) ....... (1)

Where;

r = quarterly interest rate = interest rate per year / Number of quarters in a year = 20% / 4 = 5%, or 0.05

n = number of quarters = Number of years * Number of quarters in a year = 2 * 4 = 8

Substituting the values into equation (1), we have:

Present value of quarterly operating cost = $6,000 * ((1- (1/(1 + 0.05))^8)/0.05) = $38,779.28

Present value of salvage value = Salvage value / (1 + quarterly interest rate)^Number of quarters = $30,000 / (1 + 0.05)^8 = $20,305.18

Present worth of package K = First cost + Present value of quarterly operating cost - Present value of salvage value = $200,000 + $38,779.28 - $20,305.18 = $218,474.10

Step 2: Calculations of present worth of Package L

First cost = $280,000

Present value of quarterly operating cost = quarterly operating cost * ((1- (1/(1 + r))^n)/r) ....... (1)

Where;

r = quarterly interest rate = interest rate per year / Number of quarters in a year = 20% / 4 = 5%, or 0.05

n = number of quarters = Number of years * Number of quarters in a year = 4 * 4 = 16

Substituting the values into equation (1), we have:

Present value of quarterly operating cost = $2,200 * ((1- (1/(1 + 0.05))^16)/0.05) = $23,843.09

Present value of salvage value = Salvage value / (1 + quarterly interest rate)^Number of quarters = $30,000 / (1 + 0.05)^16 = $13,743.35

Present worth of package L = First cost + Present value of quarterly operating cost - Present value of salvage value = $280,000 + $23,843.09 - $13,743.35 = $218,474.10 = $269,900.25

Step 3: Comparison of present worth

Present worth of package K = $218,474.10

Present worth of package L = $269,900.25

Therefore, Package K offers the lower present worth analysis.

7 0

3 years ago

which statement is true? A. People throughout history have used only currency notes for financial transactions. B. The Reserve B

scoray [572]

The answer is D.The Federal Reserve affects monetary policy.

6 0

3 years ago

1. Describe a real or made up but realistic situation that could cause you or someone you know to have to use money from a finan

Rus_ich [418]

1.A realistic situation in which can cause someone to use money from a financial reserve is to payoff a medical bill. Another situation would be if say, you had to pick up and move. You would need enough money to not only purchase your residence, but also movers, necessities, and they deposit.

2. The financial reserve should have enough money to last a at least 6 months. There should definitely be enough money to purchase food and necessities. Depending on how big your family is and how much you spend affects the duration of the amount of funds. Also what you choose to spend your money on is a big key factor.

3. I would rather have a compound interest when it comes to a savings account.An account with simple interest will take money from you, rather than save it. When it comes to putting money into an account that offers interest, you want to get the highest interest rate possible, so that your money grows as fast as possible. A compound interest will “compact” your money as much as possible, saving you more.

8 0

3 years ago

True or False. An increase in financial leverage generally results in a higher return on equity (ROE).

xz_007 [3.2K]

Answer:

False

Explanation:

An increase in financial leverage only results in a higher return on equity when the return on assets is higher than the cost of the leverage (i.e. the interest rate on debt).

Given the relationship below among, total assets, equity and debt (leverage)

total assets = equity + debt

and equity = total asset - debt,

We can deduce the equation below

Return on Equity = Return on Asset (ROA) - Return to Debt (ROD) (approximately)

Accordingly, if ROA is greater than ROD, an increase in financial leverage will result in a higher ROE. If the cost of debt (ROD) is however higher than ROA, an increase in financial leverage will result in a lower ROE.

5 0

3 years ago