What are the essential elements for a commodity to be rich in economics.

During the first month of operations ended August 31, Kodiak Fridgeration Company manufactured 48,000 mini refrigerators, of whi

Anvisha [2.4K]

Answer:

Part a.

Income statement based on the absorption costing concept.

Sales $8,800,000.00

Less Cost of Sales

Beginning Inventory $0

Add Manufacturing Cost $6,048,000.00

Less Ending Inventory ($504,000.00) ($5,544,000.00)

Gross Profit $3,256,000.00

Less Expenses :

Selling and administrative expenses:

Variable $528,000.00

Fixed $352,000.00 ($880,000.00)

Net Income/(loss) $2,376,000.00

Part b.

Income statement based on the variable costing concept.

Sales $8,800,000.00

Less Cost of Sales

Beginning Inventory $0

Add Manufacturing Cost $5,520,000.00

Less Ending Inventory ($460,000.00) ($5,060,000.00)

Contribution $3,740,000.00

Less Expenses :

Fixed manufacturing cost $528,000.00

Selling and administrative expenses:

Variable $528,000.00

Fixed $352,000.00 ($1,408,000.00)

Net Income/(loss) $2,332,000.00

Part c.

Reason : Fixed Costs deferred in Ending Inventory in Absorption Costing has resulted in a higher Income.

Explanation:

Units in Ending Inventory Calculation :

Production 48,000

Less Sales (44,000)

Ending Inventory 4,000

Absorption Costing Calcs

Variable Manufacturing Costs

Direct materials $3,360,000.00

Direct labor $1,344,000.00

Variable manufacturing cost $816,000.00

Fixed manufacturing cost $528,000.00

Total $6,048,000.00

Ending Inventory = $6,048,000.00 × 4,000 / 48,000

= $504,000

Variable Costing Calcs

Variable Manufacturing Costs

Direct materials $3,360,000.00

Direct labor $1,344,000.00

Variable manufacturing cost $816,000.00

Total $5,520,000.00

Ending Inventory = $5,520,000.00 × 4,000 / 48,000

= $460,000

4 0

3 years ago

Cheyenne Corp. is authorized to issue both preferred and common stock. The par value of the preferred is $50. During the first y

qaws [65]

Answer:

Feb. 1

Debit : Cash (48,000 x $52) $2,496,000

Credit : Preferred Stock (48,000 x $50) $2,400,000

Credit : Paid in excess of Par - Preferred Stock $96,000

July 1

Debit : Cash (66,000 x $56) $3,696,000

Credit : Preferred Stock (66,000 x $50) $3,300,000

Credit : Paid in excess of Par - Preferred Stock $396,000

Explanation:

With Par value stocks, any amount paid in excess of par is placed in a reserve - Paid in Excess of Par as shown in the journals above.

5 0

3 years ago

Suppose the United States has a comparative advantage over Mexico in producing pork. The principle of comparative advantage asse

vichka [17]

Answer:

d. Mexico has nothing to gain from importing United States pork.

Explanation:

The principle of comparative advantage asserts that countries (in this case Mexico) are better off importing certain goods (in this case pork), given that the opportunity cost of importing such goods are less in comparison to the production costs of manufacturing them within the country.

By definition, a country is said to have a comparative advantage over another, when they can produce a certain good or service at a lower marginal or opportunity cost.

6 0

3 years ago

Old Town Industries has three divisions. Division X has been in existence the longest and has the most stable sales. Division Y

blagie [28]

Answer:

D.

Explanation:

Based on the scenario being described within the question it can be said that when allocating funds, the firm should probably assign the highest cost of capital to division Z because it is most likely the riskiest of the three divisions. This is because Division Z focuses on research and development which means that they might not actually discover or create something that can bring value to the company and is therefore highly risky.

4 0

3 years ago

Read 2 more answers

A. Cash receipts from customers for services rendered __________ Operating __________Inflow

vaieri [72.5K]

Answer:

a. Cash receipts from customers for services rendered

Indication: Operating activities and Cash Inflow

b. Sale of long-term investments for cash

Indication: Investing actiivity and Cash Inflow

c. Acquisition of property, plant and equipment for cash

Indication: Investing activity and Cash Outflow

d. Payment of income taxes

Indication: Operating activity and Cash Outflow

e. Bonds payable issues for cash

Indication: Financing Activity and Cash Outflow

f. Payment of cash dividends declared in previous year

Indication: Financing activity and Cash Outflow

g. Purchase of short-term investments (not cash equivalents) for cash

Indication: Investing activity and Cash Outflow

h. Purchases of inventory for cash

Indication: Operating activity and Cash Outflow

Definition of terms

Operating Activity: This activity will show how much the cash flow from the business in operating . This included net profit and changes in assets and liabilities and amortization expenses .

Investing Activities: This part is shows the where the money is invested or investment is sold.

Financing Activities: This activities will show the cash flow from financing activities between the reporting period example. Raising or payment of the fund through the common stock , preference and bonds etc.

5 0

3 years ago

What are the essential elements for a commodity to be rich in economics.​

What are the essential elements for a commodity to be rich in economics.