Answer:
(a) 10.4%; 16.73%
(b) 6.33%
Explanation:
Given that,
Wages paid to the workers in 2016 = $25 per hour
Price level in 2016 = 241
Wages paid to the workers in 2017 = $41 per hour
Price level in 2017 = 245
Real wage rate in 2016:
= (Nominal wages ÷ Price level) × 100
= ($25 ÷ 241) × 100
= 0.104 × 100
= 10.4%
Real wage rate in 2017:
= (Nominal wages ÷ Price level) × 100
= ($41 ÷ 245) × 100
= 0.1673 × 100
= 16.73%
Therefore, the real wage increase received by these workers in 2017 is calculated as follows:
= Real wage rate in 2017 - Real wage rate in 2016
= 16.73% - 10.4%
= 6.33%
Hence, these workers do get a raise between the two years.
Answer:
Payne should exclude Salem's January 1, Year 1, Retained Earnings and income for January 1 to September 30 from consolidated Retained Earnings and consolidated income
Explanation:
The Retained Earnings of Salem on January 1, Year 1 and and its income during the period between January 1 and September 30 would not be included in the Year 1 consolidated financial statements.
The reason is that The Retained Earnings of Salem on January 1, Year 1 and and its income during the period between January 1 and September 30 are part of the equity of the shareholders that that Payne acquired on September 30, Year 1. They would then be eliminated in the eliminating entry of the consolidating investment.
Answer:
1. Factory supervisory salaries <u><em>Production Cost</em></u> Factory Overhead
2. Sales commissions Period Cost Selling expense
3. Income tax expense Period Cost tax expense
4. Indirect materials used <u><em>Production Cost</em></u> Factory Overhead
5. Indirect labor <u><em>Production Cost </em></u>Factory Overhead
6. Office salaries expense Period Cost Administrative expense
7. Property taxes on factory building <em><u>Production Cost</u></em><em> </em>Factory Overhead
8. Sales manager's salary Period Cost Selling expense
9. Factory wages expense <em><u>Production Cost </u></em>Direct Labor
10. Direct materials used <em><u>Production Cost</u></em> Direct Materials
Explanation:
A period cost is any cost that cannot be capitalized into prepaid expenses, inventory, or fixed assets
Period cost goes straight to expense account
While
Production Cost do capitalizes through Inventory and later recognize as cost of goods sold.
Answer:
$59, 768.7
Explanation:
The ROS (Return on sales) of a company is a ratio used to evaluate a company's operations to how much profit they make per dollar of sales.
Since the company's goal is to increase sales by $417,963 this year they would need to reduce their logistics cost.
We use the formula
ROS =
Operating profit / (Net sales or expected Net sales)
We therefore substitute the formula:
The Operating profit= ROS X Net sales expected
14.3% x $417, 963 = $59, 768
Answer:
The multiple choices are:
9.98 percent
10.04 percent
10.79 percent
10.37 percent
10.45 percent
The third option of 10.79% is correct
Explanation:
The cost of equity according to Miller and Modgiliani capital asset pricing model is given below:
Ke=Rf+beta*(Mrp-Rf)
Rf is the risk free rate which is the return on government security is 2.7%
beta is 1.14
Mrp is the market risk premium is 7.1% which is given in the formula as (Mrp-Rf)
Ke=2.7%+1.14*7.1%
Ke=2.7%+8.09%
Ke=10.79%
Hence the correct option out of the options given above is the third option
It is expected that any shareholder that invests in the shares of Southern Home Cooking would get return of 10.79%
