Exercise 10-7 Direct Materials Variances [LO10-1] Huron Company produces a commercial cleaning compound known as Zoom. The direct materials and direct labor standards for one unit of Zoom are given below: Standard Quantity or Hours Standard Price or Rate Standard Cost Direct materials 5.70 pounds $ 2.50 per pound $ 14.25 Direct labor 0.50 hours $ 7.50 per hour $ 3.75 During the most recent month, the following activity was recorded: Eleven thousand pounds of material were purchased at a cost of $2.40 per pound. The company produced only 1,100 units, using 9,900 pounds of material. (The rest of the material purchased remained in raw materials inventory.) 650 hours of direct labor time were recorded at a total labor cost of $7,800. Required: Compute the materials price and quantity variances for the month. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values. Do not round intermediate calculations.)

Answer:

The answer is (A) They undergo continuous change.  

Explanation:

To remain competitive in today’s world, a company must be willing to continue changing according to what the market currently needs and will need in the future. When a company remains stagnant, it would be outpaced by its competitors. Most of the household names that we commonly encounter maintains a spirit of continuous improvement – and we can encounter this from the innovative product they choose to make, better customer experience, or improvement in internal business process.  

Answer:

Estimate: $43

Exact: $42.97

Explanation:

1. First we must identify the rules of rounding.

    Any number you want to round to (ie: the nearest dollar, tenth, ect) you must look at the number behind it (ie: looking at the ones spot when asked to round to the nearest ten). This number behind is called the rounding digit.

    If the rounding digit we are asked to round is a 0, 1, 2, 3, or 4, then we make the rounding digit and every number behind it a 0. This is call rounding down.

    If the rounding digit we are asked to round to is a 5, 6, 7 , 8, or 9, then we make the rounding digit and every number behind it a 0. The number in front of the rounding digit (the place value we were asked to round to) becomes 1 digit higher. This is called rounding down.

2. We will now round all the numbers to the nearest dollar. So, our rounding digit will be the number behind the dollars, the tenths place.

    4.21 → 4.21 → rounding down → 4.00 → 4

    7.19 → 7.19 → rounding down → 7.00 → 7

    12.68 → 12.68 → rounding up → 13.00 → 13

    2.02 → 2.02 → rounding down → 2.00 → 2

    10.24 → 10.24 → rounding down → 10.00 → 10

    6.63 → 6.63 → rounding up → 7.00 → 7

3. Next, we will take all our rounded numbers and add them up.

    4 + 7 = 11

           ↓

  11 + 13 = 24

           ↓

  24 + 2 = 26

           ↓

 26 + 10 = 36

           ↓

   36 + 7 = 43

4. Then, add up all the original prices.

      4.21 + 7.19 = 11.40

                     ↓

   11.40 + 12.68 = 24.08

                     ↓

    24.08 + 2.02 = 26.10

                     ↓

    26.10 + 10.24 = 36.34

                     ↓

     36.34 + 6.63 = 42.97

5. The estimate, when compared to the actual answer, is very comparable because the estimate is only $0.03 more than the actual amount. The two are less than 10¢ away from each other. The efficiency had when rounding and the close proximity to the real answer makes the two very comparable.

To estimate the total cost of six grocery items, you round each price to the nearest dollar and add them which gives $43. The exact total calculated with a calculator is $42.97. The estimate is reasonable because it is very close to the exact total.

To estimate the total cost of those six grocery items, you round the individual prices to the nearest dollar before adding them up. Here's how it's done:

The sum of those rounded numbers is $43 which is your estimated total cost.

To get the exact total cost, you add the original prices with a calculator:

The estimate is reasonable because it is very close to the exact total cost.

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Answer:

The following statement is False.

(a). Financing for public corporations must flow through financial markets.

Reason: Financing for public corporations can be done through various sources of finance like financial markets, financial institutes and internal funds. It is not compulsion to finance the capital of public companies through financial markets.

The following statement is False.

(b). Financing for private corporations must flow through financial intermediaries.

Reason:  Financing for private corporations does not necessarily need to flow through financial intermediaries. This can be done either directly or indirectly, i.e. with or without intermediaries.

The following statement is False.

(c). Almost all foreign exchange trading occurs on the floors of the FOREX exchanges in New York and London.

Reason: Not necessarily, there are several FOREX exchanges around the world where foreign exchange trading occurs.

The following statement is False.

(d). Derivative markets are a major source of finance for many corporations.

Reason: Derivative markets are not necessarily a major source of finance for many corporations, since there are other financial institutions such as banks etc.

The following statement is False.

(e). The opportunity cost of capital is the capital outlay required to undertake a real investment opportunity.

Reason: The opportunity cost of capital is defined as the incremental return on investment that a firm foregoes when it decides to use funds for a project, rather than investing cash in a marketable security.

The following statement is False.

(f). The cost of capital is the interest rate paid on borrowing from a bank or other financial institution.

Reason:Cost of capital is the required return necessary to make a capital budgeting project.

Financial markets and intermediaries aid various businesses in raising capital. Foreign exchange is not solely bound by physical exchange floors and derivative markets do provide indirect finance benefits to corporations. The opportunity cost of capital relates to foregone investments, while cost of capital corresponds to interest on borrowed funds.

The subject of the question pertains to financial markets and their role in the capital structure of corporations, both public and private. Fundamentally, whether public or private, businesses raise capital through financial markets or intermediaries. Foreign exchange trading, while also occurring on the floor of the FOREX in New York and London, happens digitally as well, often in more vast amounts. Derivative markets, though not directly a source of capital, are used by corporations for hedging risk and speculation. Opportunity cost of capital refers to the return that could have been earned on the best-forgone investment, not the initial capital outlay. The cost of capital indeed refers to the interest corporations pay on borrowed finances.

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Answer:

The ending balance in the Allowance for Bad Debts is​ 20,500 CREDIT

Explanation:

The ending balance of Allowance for bad debts would be the 2.5% of sales

The adjustment is made to get the allowance for Bad Debt match the estimate uncollectible ammounts.

Notice it state "company adjusted for bad debt expense"

This means it debit this account as much as it needed to be to make allowance match the estimate allowance.

The write-off are transaction durign the period. They are irrelevant

So the ending balance is:

2.5% of credit sales of 820,000 = $20,500

It is important to remember that Allowance is a counter-asset account. His normal balance is credit, so the final balance is credit.

Answer: the administrative cost that should be assigned to the East division is $85,500.

Explanation: The East division should be assigned with the 45% of the administrative revenues since the total revenues obtained by the two divisions is $1,800,000 plus $2,200,000 equals $4,000,000. $4,000,000 is the total and $1,800,000 is the 45% of the total ($1,800,000 times 100 divided by $4,000,000). 45% of $190,000 is $85,500.

The East division of Aspen Corporation should be assigned $72,500 of the administrative costs based on the cost allocation rule described.

In this question, the administrative costs incurred by Aspen Corporation need to be allocated to the East and West divisions based on their individual revenues. To calculate the allocation for the East division, we can use the formula: (East division revenue / Total revenue) * Administrative costs. Using the provided information, the allocation for the East division would be:

((1,800,000 / (1,800,000 + 2,200,000)) * 190,000 = $72,500

Learn more about Cost allocation here:

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Answer:

$1,070,000.00

Explanation:

Break Even Point in Sales = Fixed Cost/ Contribution Margin Ratio

In case contribution margin is taken as a percentage then straight calculation can be done.

Since variable cost = 60%, contribution margin ratio = Sales - Variable costs = 40%

Break even point in sales = $428,000.00 / 40% = $1,070,000.00

Alternatively it can be calculated by taking contribution per unit, for this

Contribution per unit = Sales Value - Variable cost = $135 - 60% = $54

BEP in units = $428,000 / $54 = 7,925.925 units

BEP in sales = BEP in units X Selling price per unit = 7,925.925 X $135 = $1,069,999.875

Thus value in both cases is same the difference is of rounding off.

$1,070,000.00

Answer:

Statement of Operations. ( last choice)

Statement of Operations is not required by GAAP regarding a voluntary health and welfare organization.

Answer:

Cash flow generated from financing activities 400,000

Cash flow used in Investing activities 7,800,000

Explanation:

700,000 debt receive

-500,000 dividends paid

200,000 other adjustment on Financing

400,000 TOTAL CASH GENERATED

-8,300,000 purchase of PPE

500,000 other adjustment on Inventing

-7,800,000 TOTAL CASH USED

Notice: There is no hint about the adjustment being related as negative, so it should be assuem are positive cashflow.

Answer:

The expected rate of return is 32.5%

Explanation:

The expected rate of return is equal to the sum of all the outcomes. So, in order to obtain the rate of return, you have to multiply each possible outcome by its probability of occurrence. Note that the sum of [tex]0.10 + 0.25 + 0.50 + 0.15 = 1 = 100%[/tex], that means that the probability of all outcomes has to sum 100%.

The result of each outcome multiplied by its probability is:

The result of the sum of those calculations is equal to 0.325, or 32.5%.

Answer:

D. $2.67

Explanation:

On the high-low method we compare the diference between the highest level and lowest level of activity.

highest 500 dogs 3,600 (fixed + variable cost)

less

lowest 200 dogs 2,800 (fixed + variable cost)

300 dogs    800 variable cost

800/300 = variable cost per dog = 2.6666667 = (2 + 2/3) variable cost of water bill

800 x (2 + 2/3) + fixed cost = 3,600

2133,3333 + fixed cost = 3600

fixed cost = 3,600 - 2,133.33 = 1,466.66667

The variable cost per dog is calculated by finding the difference in total cost between the two given months, then dividing that by the difference in the number of dogs washed. The answer is $2.67 per dog.

To calculate the variable cost per unit, we first need to find the difference in total cost then divide by the difference in units. The total cost difference between May and November is $3600 - $2800 = $800. Now, the difference in the number of dogs washed in May and November is 500 dogs - 200 dogs = 300 dogs. The variable cost is therefore $800 / 300 dogs = $2.67 per dog. Hence, the correct answer is D. $2.67.

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Answer:

b. activity-based costing is not applicable to service businesses.

Explanation:

b.- activity cost was created with the idea of being used for sercive business. It distribute the phases of the service in diferent activities and assing cost to them. This statment is FALSE ABC can be used for service business

Answer:

The answer is substantial.

Explanation:

Substantial, in the context of market segment, means that there are a number of people who are able to purchase the product based on the set price, and that there are a sufficient number of them for the business to make a worthwhile profit. Measuring how substantial a market segment is would help businesses determine market segments in a more effective manner, alongside criteria such as measurable, accessible, and actionable.

Answer:

A) variable costing

Explanation:

acording to a citated text the variable costing excluded all fixed manufacturing costs is the Variable costing

Answer:

The correct answer would be Option C, None of the other choices are correct.

Explanation:

Demand and supply curves are plotted on a graph containing quantity and price of the product on x axis and y axis respectively.  The intersection of demand and supply curves give us the accurate quantity at an accurate price of the product. Any shift of the curve will result in the surplus or shortage of the product. So in this question, it is asked the reason for the decrease in the quantity of eggs consumed. So the answer is A shift to the right in the supply curve for eggs and a shift to the left in the demand curve for eggs will result in an unambiguous decrease in the quantity of eggs consumed.

The question asks for a scenario that would result in a decrease in both the real price of eggs and the total annual consumption of eggs. The correct answer is Option b: a simultaneous leftward shift in both the supply and demand curves, which leads to an unambiguous decrease in the equilibrium quantity and an ambiguous impact on price, but given the historical data on actual price decrease, this would be the cause.

To determine the cause of an unambiguous decrease in both the real price of eggs and the total annual consumption of eggs, we need to consider the effects of shifts in both the supply and demand curves. Let's review the given options:

Given these analyses, the correct answer is Option b: A shift to the left in the supply curve and a shift to the left in the demand curve for eggs. This is the only scenario provided that could lead to a decrease in both price and quantity consumed.

Answer:

We can accept the note giving 418,742.13 or less.

Explanation:

There is a note due in 5 year.

When someone offered this note, it was 3 years from maturity. Is asking you to purchase the note for cash.

The idea is that we receive 500,000 in the future.

For how much are we willing to accept the note?

We are going to discount the 500,000 in three years using our 6% rate compound semiannually.

[tex]Principal * (1+ \frac{r}{n} )^{time* n} = Ammount[/tex]

Where n is the times the rate compounds within a year.

semiannual rate, capitalize 2 times per year.

We post our givens and solve:

[tex]Principal * (1+ \frac{0.06}{2} )^{3* 2} = 500,000[/tex]

[tex]\frac{500,000}{(1 + 0.03)^{6}} = PV [/tex]

PV = 418742.1283

PV = 418,742.13

We can accept the note giving 418,742.13 or less.

Answer:

a) Baker's profit margin = 7.5%

b) No change on return on total assets

Explanation:

a) Assets Turnover = [tex]\frac{Net Sales}{Average Total Assets}[/tex] = 1.6 times

Return on total assets = [tex]\frac{Net profit}{Average Total assets}[/tex] = 12%

Then we have profit margin on sales = [tex]\frac{Return on total assets}{Asset turnover ratio}[/tex] = [tex]\frac{12}{1.6}[/tex] = 7.5%

b) In case asset turnover declined to 2 times with profit margin of 6% then Return on total assets = Asset turnover ratio X Profit Margin

= 2 X 6% = 12%

Thus there is no change in that case on return on total investments.

a) Baker's profit margin = 7.5%

b) Thus there is no change in that case on return on total investments.

Final answer:

Baker Oats' profit margin is calculated as 7.5%. Its return on total assets remained at 12% despite changes in asset turnover and profit margin in the following year. The firm's accounting profit in the self-check question was $50,000.

Explanation:

To calculate Baker Oats's profit margin, we use the formula for Return on Total Assets (ROTA):

ROTA = Asset Turnover × Profit Margin

Given that ROTA is 12% and Asset Turnover is 1.6 times per year, the profit margin (PM) can be calculated as:

ROTA / Asset Turnover = PM

12% / 1.6 = PM

PM = 7.5%

For part b, to find how the return on total assets changed when the assets turnover went up to 2 times and profit margin decreased to 6%, we calculate:

New ROTA = New Asset Turnover × New Profit Margin

New ROTA = 2 × 6%

New ROTA = 12%

Even though the profit margin decreased, the increase in asset turnover kept the ROTA the same year-over-year.

As for the self-check question provided: The accounting profit is calculated by subtracting explicit costs from total revenues.

Accounting Profit = Total Revenue - (Labor Costs + Capital Costs + Material Costs)

Accounting Profit = $1,000,000 - ($600,000 + $150,000 + $200,000)

Accounting Profit = $1,000,000 - $950,000

Accounting Profit = $50,000

Answer:

One of the biggest problems with telephone surveys is that people often refuse to participate. - D.

Answer:

D. people often refuse to participate.

Explanation:

One of the biggest problems with telephone surveys is that people often refuse to participate. Many people ignore the calls or block the caller because they are not interested or refuse.

Answer:

The adjusting entry at the end of the year is option c.

Debit Bad Debts Expense $12,335;

credit Allowance for Doubtful Accounts $12,335

Explanation:

Bad debt : The amount which is not received by the customer for good supplied by the company is treated as a bad debt.

In the given question,

The 2.5% of ending accounts receivable will be uncollectible so, the allowance would be equals to

= 2.5 % of Accounts receivable

= 2.5 % × $441,000

= $110,25

Now add the allowance for doubtful accounts to the allowance which is calculated above.

So,

= $110,25 + 1,310

= $12,335

The estimated bad debts expense is $12,335

Hence, the adjusting entry at the end of the year is option c.

Debit Bad Debts Expense $12,335;

credit Allowance for Doubtful Accounts $12,335

Final answer:

The correct adjusting entry to record the estimated bad debts expense, considering the percent of receivables method and the current debit balance in the Allowance for Doubtful Accounts, is to debit Bad Debts Expense and credit Allowance for Doubtful Accounts by $12,335. Option C is correct.

Explanation:

To determine the adjusting entry for bad debts expense using the percent of receivables method, we first calculate the desired ending balance in the Allowance for Doubtful Accounts. This is done by multiplying the ending accounts receivable balance by the bad debt percentage, which is 2.5% in this case. So, the calculation is $441,000 * 2.5% = $11,025.

Next, we need to adjust the current balance in the Allowance for Doubtful Accounts to reach the calculated desired balance. The existing balance is a debit of $1,310, which is unusual as this account typically has a credit balance. To correct this and achieve the desired credit balance of $11,025, we need to add both the desired ending balance and the absolute value of the current balance, resulting in an adjusting entry of $11,025 + $1,310 = $12,335.

The correct adjusting entry is therefore: Debit Bad Debts Expense $12,335; credit Allowance for Doubtful Accounts $12,335. This adjusts the Allowance for Doubtful Accounts to the proper credit balance, reflecting the estimated uncollectible receivables.

Answer:

A. what Mary can afford and what she cannot afford

Explanation:

The line will be the combination between Cookies and coffees she can afford with his daily income of 8

She can afford to purchase any combination on the line or below the line

for example,

She can buy either 4 coffees = 8

3 coffees 2 cookies = 8

2 coffee 4 cookies = 8

1 coffe 6 cookies = 8

8 cookies = 8

or just 1 coffe = 2

She cannot afford above the line

4 coffe and 3 cookies = 4*2 + 3 *1 = 11

Answer:

Because of its importance in summarizing your strategy, the Introduction and Overview of your business plan should be written last-B.

Final answer:

The correct answer is B, as the Introduction and Overview of your business plan should ideally be written last to effectively summarize your strategy and research findings. It encapsulates the critical points of your business strategy in a concise manner and is not meant to be a detailed section or repeated in a cover letter.

Explanation:

The Introduction and Overview of your business plan should be written last. This is because it functions as a summary of your business strategy and plan, which means you need all the detailed information derived from your research to accurately encapsulate your business vision and approach. Managers and entrepreneurs commonly write the executive summary or introduction last, as it needs to be accurate, concise, and reflective of the entire document, whether it's a 100-page white paper or a 10-page summary analysis. Any key points and unique aspects of your business need to be clearly defined here, providing potential investors or stakeholders with a compelling high-level overview without unnecessary detail.

Furthermore, the Introduction is similar to an executive summary and typically presents the same type of information, though with slightly different focuses. It's often more detailed than a cover letter or abstract, both of which serve different purposes in the context of business communications. While a cover letter might introduce the business plan and its author, the introduction itself is designed to introduce the business concept.

Answer:

Explanation:

Payment of Alimony ⇒ Deductible For AGI    

Mortgage interest on residence   ⇒ Deductible From AGI    

Property Tax on Residence   ⇒ Deductible From AGI    

Contribution to traditional IRA  ⇒ Deductible For AGI    

Contribution to United Church  ⇒  Deductible From AGI    

Loss on sale of real estate ⇒   Deductible For AGI    

Medical Expenses   ⇒  Deductible From AGI    

State Income Tax  ⇒  Deductible From AGI    

Federal Income Tax  ⇒  Not Deductible    

∴Gross Income:      

Salary Income                                                        60,000

Net Rent                                                                  6,000    

Dividend Income                                                    3,500    69,500

∴Deduction for AGI:    

Payment of Alimony                                             12,000    

Contribution to traditional IRA                            5,000    

Loss on sale of real estate                                  2,000         19,000    

Adjusted Gross Income                                                         50,500

∴ Itemized Deduction      

Mortgage interest on residence                                      4,900    

Property Tax on Residence                                              1,200    

Contribution to United Church                                       2,100    

State Income Tax                                                                 300    

Medical Expenses[$3250 - ($50500× 7.50%)]                 ----    

∴Total Itemized Deduction                                              8,500

Daniel's gross income for 2018 is $69,500, his Adjusted Gross Income (AGI) is $52,500, and his total itemized deductions are $13,500. The deductions include mortgage interest, property tax, state income tax, and charitable contributions. Medical expenses are not deductible in this case.

Daniel's Gross Income, Adjusted Gross Income (AGI), and Total Itemized Deductions

1. What is Daniel's gross income?

Daniel's gross income includes salary, net rent income, and dividend income.

Total Gross Income = $60,000 + $6,000 + $3,500 = $69,500

2. What is Daniel's AGI?

To calculate Daniel's Adjusted Gross Income (AGI), we subtract the allowable adjustments from his gross income:

Total Adjustments = $12,000 + $5,000 = $17,000

AGI = $69,500 - $17,000 = $52,500

3. What is Daniel's Total Itemized Deductions (after any limitations)?

Daniel’s itemized deductions include the following:

Medical Expenses Deductible Amount: 7.5% of AGI ($52,500) = $3,937.50. Since $3,250 < $3,937.50, no medical expenses are deductible.

Total Itemized Deductions = $9,900 + $1,200 + $300 + $2,100 = $13,500.

Answer: The quality and design of calculators improved dramatically from 2014 to 2016.

A new, safe method of memory enhancement became available for purchase.

As the price of textbooks increased, more and more students turned to the used-book market or chose not to buy textbooks at all, instead using the copies on reserve in the library.

Explanation: If textbook price increases , it might overstate the inflation in cost of going to college.

A new safe memory enhancement will be costly because of it's superior quality and technological progress.

Similarly , new calculator will also be improved and superior.

Thus, the survey will reflect higher prices,

Price indexes like the CPI could overstate education-related inflation for reasons such as professors enforcing set purchase requirements, students finding alternate ways to acquire textbooks due to price increases, and difficulty accounting for improvements in product quality, such as calculators.

Student, your question pertains to Consumer Price Indexes (CPI) and how they represent inflation in education costs. Such price indexes can sometimes overstate inflation due to various factors.

The first and fourth options can explain this overstatement because they regard changes in consumer behavior related to costs: professors requiring a set number of notebooks independent of price, and students finding alternative methods to buying textbooks due to price increases.

These examples indicate that because the CPI uses a fixed basket of goods and services, it does not accurately reflect substitutions or changes in purchasing behavior that consumers might make in response to price changes.

The second option, an improvement in calculator quality, is another potential instance of overstated inflation. The CPI often has difficulty adjusting for quality changes, and so might not account for any additional value an improved calculator provides, thereby potentially overstating the effect of inflation.

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Answer: The following are the similarities between job order and process costing:

Explanation:

Job order costing and process costing have significant similarities:  

Answer:

B. 2,600 to 2,000.

Explanation:

tax revenue = units x tax rate

units = tax revenue / tax rate = 6,000/3 = 2,000

2,000 will be the quantity after taxes.

6000 goverment revenue - 3900 consumer surplus - 3000 producer surplus

900 deathweight loss

(tax x ↓unit)/2 = deathweight loss

(3 x ↓unit)/2 = 900

(3 x ↓unit) = 900 *2

↓unit = 1800/3 = 600

It decrease to 2000 from 2600

A $3 per unit tax creates a wedge between the price paid by consumers and the price received by producers, representing a production cost increase. This results in a leftward shifted supply curve, with reduced consumer and producer surplus. The burden of the tax is shared, decreasing the equilibrium quantity of goods.

When a $3 per unit tax is imposed on a good, the government creates a wedge between the price paid by consumers and the price received by producers. The distance between these prices equals the tax rate.

The new market price is the price paid by consumers, but sellers receive less per unit sold as they pay the difference (tax) to the government. This tax is akin to an increase in production cost, symbolized by a leftward shift of the supply curve. The new supply curve intercepts the demand at the new quantity.

The tax revenue is found by multiplying the tax per unit by the total quantity sold. The tax incidence, or burden, is shared by both consumers and sellers. In this case, the consumers' surplus decreased by $3,900 and the producers' surplus decreased by $3,000, causing a total tax revenue of $6,000 and a decrease in the equilibrium quantity of goods.

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Answer:

Interest receivable 500 debit

Interest revenue 500 credit

Explanation:

[tex]Principal\times rate \times time = Interest[/tex]

Important: rates and time must be express in the same unit.

In general rates are express as annual rate, so the time measurement should be in years to.

With that information, from August 1st to December 31th 5 months has past.

That represent 5/12 of a year so that is the amount to post in the formula.

10,000 * .12* 5/12 = 500 Interest accrued for the period

This interest are revenue So to recognzie the gain we credit it.

We also need to declare that we are going to receive interest in the future, so we use interest receivable account.

Answer:

The net operating income should be $69,100 for 7,200 units.

Explanation:

Given,  

Sales (6800) units - $306,000

Variable expense (6800)  - 149,600

Contribution - 156,400 (Sales - Variable cost )

Less - Fixed Expense $96,500

Net operating Income - $59,900

Since, the sales and the variable expense is given for 6800 units. For computing the net operating income for 7200 units, it is important to calculate per unit price of both.  

Per unit sales = Sales ÷ Number of units

                      = $306,000 ÷ 6800 units

                      =  $45 per unit sale

Per unit variable expense = Variable expense ÷ Units

                                           = 149,600 ÷ 6800 units

                                           =  22 per unit expense.

Now, we can compute easily.  

Sales = (7200 × $45) = $324,000  

Less - Variable cost (7200 × $22) =  158,400  

Contribution - $165,600

Less - Fixed expense - $ 96500

Net operating income - $69,100

The fixed expense would remain the same.  

Thus, the net operating income should be $69,100 for 7,200 units.

Answer: $2,100

Explanation:

Given:

No. of shares 24,000 of $100 par  

Dividend per year = (100 shares X $100 par) X 7% = $700  

Since, the preferred stock is cumulative, the holders will receive past dividends not distributed.

From 2016: 700

From 2017: 700

From 2018: 700

Total = $2,100

Answer:

Atomicity: All statements within a transaction must be successfully completed or completely aborted.

Consistency: A transaction takes the database from one consistent state to another.

Isolation: The data used by one transaction can not be used by another transaction until the first one has completed

Durability: Once a transaction is done it can not be lost or undone.

Serializability: The schedule for execution in a multiuser environment insures consistent results

The terms Consistency, Atomicity, Isolation, Durability, and Serializability relate to database transactions, and matching them with their descriptions ensures an understanding of how databases maintain integrity and handle multiple transactions.

The terms Consistency, Atomicity, Isolation, Durability, and Serializability are all fundamental concepts related to database transactions. Matching them with their descriptions:

Final answer:

Dropping product line F, with an operating loss of $5,000, would actually increase Momentum Rollerblades' operating income by $16,000 because there would be $21,000 of fixed costs savings, which is more than the current contribution margin from product F.

Explanation:

When considering whether to drop product line F, which has an operating loss, we should examine the impact on the overall operating income for Momentum Rollerblades. Currently, product line F has a loss of $5,000. However, if $21,000 of its fixed costs can be eliminated by dropping the line, then the total operating income could potentially increase. Here is the calculation:

By dropping product line F, Momentum Rollerblades would increase its operating income by $ +16,000 since the savings in fixed costs exceed the contribution margin that would be lost by eliminating the product.

Answer:

The value of any asset is the sum of the present values of all future cash flows it is expected to provide over the relevant time period

Explanation:

When valuing an asset, an investor should

1.  First forecast the cash flows that he is likely to receive in each period during during the investment horizon.

2. Discount each of the periodic cash-flows at the relevant periodic required rate of return - i.e calculate the present value for each cash-flow

3. Sum the present values calculated in step 2. This total is the value of the asset.