The demand for bread in Ahoma City ranges from 100 to 120 tons per day, every day of the year. The demand is easily satisfied on
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Answer:
Explanation:
a. In the income statement, the total revenues and the total expenses are recorded.
If the total revenues are more than the total expenditure then the company earns net income
And, If the total revenues are less than the total expenditure then the company have a net loss
This net income or net loss would reflect in the statement of the retained earning account.
Before preparing the income statement, first, we have to compute the net loss or net income which is shown below:
= Sales - cost of good sold - selling expenses - administrative expenses
= $875,000 - $525,000 - $125,000 - $80,000
= $145,000
b. The computation of the inventory balances are shown below:
Direct material = Purchased material - used material
= $168,500 - $149,250
= $19,250
Work in progress = Used material + direct labor wages + factory overhead - transferred units
= $149,250 + $360,000 + $120,000 - $600,000
= $29,250
Finished goods = Transferred units - cost of goods sold
= $600,000 - $525,000
= $75,000
The preparation of the income statement is presented in the spreadsheet. Kindly find the attachment below:
Answer and Explanation:
The computation of the net present value and the internal rate of return is shown below:
After applying the excel formulas for NPV and IRR i.e.
For NPV = NPV()
For IRR = IRR(IRR)
The NPV and IRR is $4.61 million and 38% respectively
Since the NPV is in positive so the project should be accepted also the IRR would be agree with the NPV
