"Personal selling:" A. involves direct spoken communication between sellers and potential customers. B. costs less than advertising for reaching a large, widespread market. C. tries to communicate with many customers at the same time. D. refers to "promoting" at trade shows, demonstrations, and contests. E. All of these alternatives for "personal selling" are correct.

Answer:

The restaurant's profit per meal= consumers WTP for per meal - ATC per meal = $13 - $10 = $3

Given that restaurants sells 240 meals per day at this price the profit is

= $3 * 240 = $720    

A) The size of the firms profit is $ 720.

B) As it can be seen that firm is making profit so there will be an entry into the industry since the other firms will try to capture some of the economic profit.

Also, the entry of other firms will reduce the demand for the restaurant which will lead the demand curve to shift to the left.

C) Now, the allocative efficient output level in long-run equilibrium is 200 meals. In the long-run, restaurant charges $11 per meal for 180 meal and the marginal cost of 180th meal is $9.

Thus, the size of the economic profits in the long run is always zero in monopolistic competitive market.

D) The dead-weight loss for the firm is exactly equal to $40 because the difference between the Marginal Benefit as given by the demand curve i.e., $11 and the Marginal Cost as given by the MC curve is $9, so the difference is equal to $2 ($11 - $9) for all the units between 180th and 200th.

Thus, the dead-weight loss is = $2 * (200-180)

= $2 * 20

= $40

Hence the dead-weight loss is $40.

The monopolistically competitive restaurant makes a profit of $720 which signals potential entry of more restaurants to the market. In the long-run equilibrium, if the restaurant charges $11 per meal and the marginal cost of the meal is $9, the company would make an economic profit of $360. The Deadweight loss to society if this firm is producing less than the allocatively efficient quantity will be exactly $40.

a. In the case of the monopolistically competitive restaurant, the firm's total cost per meal is $10, while the price at which consumers are willing to pay is $13. Therefore, the profit per meal is the difference between the price and the cost, which is $3. Total profit is then $3 multiplied by the number of meals served, or $3 x 240 = $720, so this restaurant firm is making a profit of $720.

b. As the restaurant is making a profit, this is a signal for entry in the long run, implying that more restaurants will open up and start providing meals to customers. This competition will push prices down and move the restaurant's demand curve left, as it won't be able to command such high prices with more competition.

c. If in the long-run equilibrium this restaurant serves 180 meals at $11 and the marginal cost of the 180th meal is $9, then profit per meal is $2. The entire economic profit of the firm in this case will be $2 x 180 = $360.

d. Assuming the allocatively efficient output level in long-run equilibrium is 200 meals, but the company only produces 180 meals, the difference in production is 20 meals. If the price charged is $11 and the marginal cost is $9, then the total deadweight loss is $2 X 20 = $40. Therefore, the deadweight loss for this firm is exactly $40, not less or greater.

https://brainly.com/question/33654925

#SPJ11

Answer:

See the explanation below:

Explanation:

(1) May 2 entry to establish the fund

Details                                              Dr ($)             Cr ($)  

Petty cash account                         1,050

Cash                                                                        1,050

To record the establishment of petty cash fund              

(2) May 30 entry to reimburse the fund

Details                                              Dr ($)             Cr ($)  

Transportation-in                             120

Postage expenses                          369

Miscellaneous expenses                240

Shortage of fund                                 9

Petty cash account                                                     738

To record petty cash transactions during May                      

Petty cash account                            738

Cash                                                                             738

To record the reimbursement of the petty cash fund.            

(3) June 1 entry to increase the fund to $1,200.

Additional amount to add = 1,200 - 1,050 = $150

The journal entries will be as follows:

Details                                              Dr ($)             Cr ($)  

Petty cash account                            150

Cash                                                                          150

To record the increase of the petty cash fund to N1,200  

Answer:

$5,600

Explanation:

AGI after casualties = AGI before casualties - Loss from damage to rental property + Personal casualty gain + Personal casualty loss = $30,000 - $6,000 + $4,000 - $4,000 = $24,000

AGI limit on casualty loss = $24,000 × 10% = $2,400

Itemized deductions = Casualty Loss - AGI limit on casualty loss + Loss from theft of bonds = $5,000  -$2,400 +  $3,000  = $5,600

Answer:

if price increases above $68 or decreases below $52, a profit is realized

Explanation:

At expiration, the break even if the stock price is equal to Call is :

-$60 + (-$5) + $3 = $68 (break even)

Put: -$3+ $60 + (-$5) = $52 (break even)

Therefore At expiration, your break even if the stock price is equal to:

if price increases above $68 or decreases below $52, a profit is realized.

Answer:

Explanation:

Revenue ($6.40 × 8,500) = $54,400

Cleaning supplies ($0.80 × 8,500) = $6,800

Electricity ($1,300 + ($0.15 × 8,500)) = $2,575

Maintenance ($0.20 × 8,500) = $1,700

Wages and salaries ($5,000 + ($0.30 × 8,500)) = $7,550

Administrative expenses ($4,000 + ($0.10 × 8,500)) = $4,850

Answer:

$3900000

Explanation:

The gross profit is the difference between the revenue earned during the year and the cost of sales. The percentage of completion method is one in which the revenue is recognized based on the cost incurred to date on the project.

Revenue to be recognized in 2021

= $15600000/($15600000 + $9600000) * $31500000

= $19500000

Though the billings for the year is lower, the difference may be recognized as unbilled receivable.

As such, the gross profit for the year

= $19500000 - $15600000

= $3900000

Final answer:

To calculate the gross profit recognized by Sunland Construction Company in 2021, the percentage of the project completed is first determined. This percentage is then used to recognize revenue, and the gross profit is calculated by subtracting the costs incurred from the recognized revenue. Sunland Construction Company should recognize a gross profit of $3,898,500 for the year 2021.

Explanation:

How to Calculate Gross Profit Recognized in 2021

The percentage-of-completion method for accounting requires estimating the percentage of the project that has been completed in the fiscal year to recognize revenue and corresponding gross profit accordingly. The gross profit is calculated based upon the costs incurred, estimated total costs, and the contract price.

The formula for the percentage of completion is:

Percentage of Completion = Costs Incurred to Date / (Costs Incurred to Date + Estimated Costs to Complete)

Then, we calculate the revenue to be recognized by:

Revenue Recognized = Contract Price * Percentage of Completion

Finally, we get the gross profit recognized by subtracting the costs incurred from the revenue recognized:

Gross Profit Recognized = Revenue Recognized - Costs Incurred

Using the provided information, the calculation steps are as follows:

Calculate the percentage of completion:
Percentage of Completion = $15,600,000 / ($15,600,000 + $9,600,000) = 0.619

Calculate the revenue to be recognized:
Revenue Recognized = $31,500,000 ×0.619 = $19,498,500

Calculate the gross profit recognized:
Gross Profit Recognized = $19,498,500 - $15,600,000 = $3,898,500

Therefore, Sunland Construction Company should recognize a gross profit of $3,898,500 for the year 2021.

Answer:

A,D,E,F &G

Explanation:

IRR is the discount rate at which the Net Present value of a project becomes zero and over this rate the Net present value become negative. All the Projects with IRR Less than the relevant WACC will not be acceptable.

WACC

High = 12%

Average = 10%

Low = 8%

Compare all of the above WACC with each of the relevant WACC to find whether a project is acceptable or not.

Project Level of Risk IRR    Relevant WACC     Acceptable

A             Low ​       9.50%                8%                    Yes

B           Average   ​8.50%                10%                  No

C           Average   ​7.50%                10%                  No

D           Low          ​9.50%                8%                  Yes

E           High         ​14.50%                12%                  Yes

F           High         ​17.50%                12%                  Yes

G           Average  ​11.50%                10%                  Yes

Final answer:

One noted disadvantage of profit-sharing plans is the necessity for employees to trust that management will accurately and transparently disclose the company's financial and profit information.

Explanation:

The disadvantage of profit sharing plans often noted is that employees must trust that management will accurately disclose financial and profit information. With profit and earnings distributed among employees, there's a direct correlation between the success of the business and benefits for employees—which can lead to improved productivity. However, the transparency necessary in financial disclosures does require trust in management's reporting.

As for the specific disadvantage choices provided, taxes on profit sharing plans are not necessarily heavier than on regular income, employers can receive tax benefits for contributing to retirement accounts of employees (though this depends on the jurisdiction and specific plan details), and employees can often access their profit sharing funds before three years in certain circumstances, such as financial hardship or plan rules.

Answer: 25.86%

Explanation:

Solving this question requires that we use all gains made and divide it by the original Nat Asset Value.

Here goes,

Opening NAV

NAV = Total Assets / No. Of shares

NAV = 580/20

Opening NAV = $29

Closing NAV

NAV = Total Assets / No. Of shares

NAV = 630/21

Closing NAV = $30

Rate of Return.

Calculating the rate of return will be as follows,

= (Closing NAV - Opening NAV + Capital gains distributions + income distributions) / Opening NAV

= (30 - 29 + 6 + 0.5) / 29

= 0.25862068965

= 25.86%

The rate of return on the fund is 25.86%

Final answer:

The gross monthly premium during the first 3 years after recovering from prostate cancer, with a 20% extra premium, is $114. This is calculated by adding the 20% extra charge of $14 to the stated gross premium of $100 that applies after the 3 years.

Explanation:

To calculate the gross monthly premium for the first 3 years after recovering from prostate cancer, where there is a 20% extra premium on the net premium, you can use the provided information about the net and gross premiums after those 3 years.

The given monthly net premium is $70, and an additional 20% of that is $14 (20% of $70). So, for the first 3 years, the additional cost will be $14 per month on top of the net premium, making the total monthly premium $84 ($70 + $14).

However, this is not the final gross premium. The question states that the gross monthly premium, after the 3 years, is $100. This $100 includes the net premium plus any additional fees or costs the insurance company adds to the net premium to get to the gross premium. Since we do not have information about other fees or costs, we have to assume that the 20% extra premium is the only additional cost. Therefore, to get the gross premium during the first 3 years, you add the additional cost ($14) to the stated gross premium after three years ($100), resulting in a total gross premium of $114 ($100 + $14) for the first 3 years.

Answer:

= $1,000,000  

Explanation:

Given that:

Because interest and proceeds from the bonds have been included in the cost of debt service, so to find the exact change, we must minus two of this expenses. Because the cost of debt increases more than the total of other items, so it will increase in the net position

So the formula to find out the net change position as following:

= Expenditures for debt service - Interest - proceeds of bonds

= $12,000,000 -  $7,000,000  - $4,000,000

= $1,000,000  

Hope it will find you well.

Final answer:

To find the equilibrium price and quantity for Nalgene bottles, set the demand and supply functions equal and solve for the price, then plug that into either function. Consumer surplus is the difference between what consumers are willing to pay versus what they pay, while producer surplus is what producers get over their minimum acceptable price.

Explanation:

To find the equilibrium price and quantity for 32-oz. wide mouth Nalgene bottles, we need to set the market demand function Q = 50,000p^-1.076 equal to the market supply function Q = 0.01p^7.208 and solve for p. Once we find the equilibrium price, we substitute it back into either the demand or supply function to find the equilibrium quantity.

Consumer surplus is the difference between what consumers are willing to pay and what they actually pay, and producer surplus is the difference between the price at which producers are willing to sell and the price they actually receive.

To calculate consumer and producer surplus, we would need to determine the area above the supply curve and below the demand curve up to the equilibrium price. This involves integrating the demand function from zero to the equilibrium price for consumer surplus and integrating the supply function from zero to the equilibrium price for producer surplus.

Answer:

7%

Explanation:

Data provided as per the question

Risk free rate = 0.4

Beta = 0.7

The computation of alpha of the stock is shown below:-

Expected return = Risk free rate + (Beta × Market rate of return)

Expected return = 0.4 + (0.7 × Market rate of return)

= 0.7

or 7%

Therefore for computing the alpha of the stock, we have applied the above formula.

Final answer:

In the regression equation for a stock's excess return, the alpha or the y-intercept is 0.4, signifying the stock's expected excess return when market excess return is zero. The R-square of 0.12 tells us that 12 percent of the stock's return variation is explained by the market's return variation.

Explanation:

The alpha of a stock, in a regression of the stock's excess return on the market excess return, represents the intercept of the regression equation. Given the regression equation E[Ri | RM] = 0.4 + 0.7*RM, the alpha of the stock is 0.4. This value indicates the expected excess return of the stock when the market excess return is zero. The value of alpha can provide insight into the stock's performance independent of the market's movements.

The R-square value of 0.12 or 12 percent indicates that only this percentage of the stock's excess return variation is explained by the market's excess return variation. Thus, the majority, that is, 88 percent (1 - R-square), of the variation in the stock's excess return is not explained by the market's excess return within this model.

Answer:

67,800 ounces

Explanation:

The amount of units produced by the manufacturer in a period is called equivalent units of production. It is calculated for the unit under process. We use the percentage of completion to calculate this. It includes the completed units and partially completed units.

In respect of Material

Units completed = 64,600 ounces

Partially completed = 3,200 (80% completed)

Equivalent Units  = Unit completed and transferred to Finished goods + Units in Work in Process x Completion percentage

Because the material is added at the beginning so all the units are considered as Equivalent units

Equivalent Units  = 64,600 + 3,200= 67,800 ounces

Answer:

The total equivalent units for direct materials if materials are added at the beginning of the process =

63,900

Explanation:

Since the direct materials are added at the beginning of the process, it simply means they are 100% complete

• Units started and completed=

(64,600-3,900) * 100%

= 60,700 * 100%

= 60,700

• Ending work in progress =

3,200 * 100%

= 3,200

Total equivalent units for direct materials if the materials are added at the beginning of the process=

60,700 + 3200

= 63,900

Final answer:

To find the cash flow from disposal, calculate the tax savings resulting from the depreciation of the machine and subtract it from the selling price. The cash flow from disposal is $2,033.37.

Explanation:

To find the cash flow from disposal, we need to calculate the tax savings resulting from the depreciation of the machine.

Step 1: Calculate the depreciation expense for each year:

Step 2: Calculate the total depreciation over the four years: $3,000 + $3,840 + $2,099.52 + $893.62 = $9,833.14

Step 3: Calculate the tax savings using the tax rate of 20%: $9,833.14 * 0.20 = $1,966.63

Step 4: Calculate the cash flow from disposal by subtracting the tax savings from the selling price: $4,000 - $1,966.63 = $2,033.37

Final answer:

The cash flow from disposal of the machine sold by Eastern Inc. at the end of four years for $4,000, after accounting for MACRS depreciation and a 20% tax rate, is $3,718.40.

Explanation:

To calculate the cash flow from disposal of a machine under MACRS, we need to establish the book value of the machine at the time of sale and the total gain or loss on the sale. Eastern Inc. bought the machine for $15,000 and is selling it at the end of four years for $4,000. Under the Modified Accelerated Cost Recovery System (MACRS), the fixed depreciation percentages for the first four years are 20%, 32%, 19.20%, and 11.52%, respectively.

The book value of the machine at the end of four years is the original cost minus the accumulated depreciation: $15,000 - $12,408 = $2,592.

The sale of the machine for $4,000 results in a gain of $4,000 - $2,592 = $1,408. Because this is a sale of business property, the gain is taxable. Eastern's tax rate is 20%, so the tax on the gain is 0.20 x $1,408 = $281.60. The cash flow from disposal is the sale price minus the tax owed: $4,000 - $281.60 = $3,718.40.

Answer:

Increase in operating income  $ 3,600                            

Explanation:

The impact on operating income will be done using incremental analysis.

Here we consider only the impact of the proposed change on the income

This is done as follows:                                                     $

Contribution before (​4,000 × $(500- 320)           =   720,000

Contribution after - (98%× 4,000)× (525-320)  =      803,600

Increase in contribution                                               83600

Increase in Fixed expenses                                       ( 80,000)

Increase in operating income                                         3,600

Complete Question:(in order)

Michelle's Monopoly Mutant Turtle (MMMT) has the exclusive right to sell Mutant t-shirts in the United States. The demand for these t-shirts is

[tex]Q = \frac{22,500}{P^2}[/tex]

The firm's short-run cost is

SRTC = 1641 + 4Q,

and its long-run cost is

RTC-7Q

What quantity should MMMT sell to maximize profit in the short run?

MMMT should sell 351.56 units. (Enter a numeric response rounded to two decimal places,)

What price should MMMT charge in the short run?

MMMT should charge a price of $ 7.95. Enter a numeric response rounded to two decimal places)

How much profit does it make?

Profit equals $-234.740. (Enter a numeric response rounded to three decimal

Would it be better off shutting down in the short run?

The firm would be better off producing in the short run.

What quantity should MMMT sell in the long run?

MMMT should sell 114.80 units. (Enter a numeric response rounded to two decimal placos)

What price should MMMT charge in the long run?

MMMT should charge a price of $    (Enter a numeric response rounded to two decimal places)

Answer:

From the given parameters

the demand for these t-shirts is

[tex]Q = \frac{22500}{P^2}[/tex]

The firms short run cost is SRTC = 1641 + 4Q

Long run cost is  LRTC = 7Q

[tex]=> Q = \frac{22500}{P^2}=> P^2 = \frac{22500}{Q}\\=> P = \sqrt{\frac{22500}{Q}} = \frac{150}{\sqrt{Q}} = 150(Q)^{1/2}\\[/tex]

Thus revenue on the product of price and quantity becomes

[tex]PQ = 150Q^{-1/2}Q = 150Q{1-1/2} = 150Q^{1/2}[/tex]

Check the attached files for additional solution

Answer:

$3,740 favorable

Explanation:

The computation of the flexible budget variance for VARIABLE COSTS is shown below:

= Standard variable cost - actual variable cost

where,

Standard variable cost is

= 935 units × $59

= $55,165

And, the actual cost is

= 935 units × $55

= $51,425

So the  flexible budget variance for variable cost is

= $55,165 - $51,425

= $3,740 favorable

Since the standard cost is more than the actual cost which leads to favorable variance

The flexible budget variance for variable costs for Clementine Company, calculated by subtracting the actual variable cost from the budget and then multiplying it by the actual quantity sold, is $3,740. This is a favorable variance as actual costs were below budget.

The flexible budget variance for variable costs refers to the difference between the budgeted variable cost and the actual variable cost during a specific period. According to the provided figures, we can calculate the variance by multiplying the difference in unit variable costs ($59 budgeted - $55 actual) by the actual quantity of units sold (935 units).

So, Flexible Budget Variance for Variable Costs = (Budgeted Variable Cost per Unit - Actual Variable Cost per Unit) × Actual Quantity Sold.

Applying values, we have Flexible Budget Variance for Variable Costs = ($59 - $55) × 935 = $3,740. Hence, the flexible variance for variable costs for Clementine Company is $3,740. As actual costs were less than budgeted, we don't need to put a minus sign in front of our answer. This is considered a favorable variance because the actual costs for the company were less than what was budgeted.

https://brainly.com/question/36840009

#SPJ3

Answer:

quantity supplied of labor at the sailboat factory will increase.

Explanation:

If it happens that the sailboat manufacturer increases the hourly wage paid to his employees, then the more employees will rush to the sailboat thereby increasing the quantity supplied of labor at the sailboat factory.

Answer:

The price of the stock will be $76.97

Explanation:

We first need to determine the constant growth rate on dividends.

Growth rate (g) = (D1 - D0) / D0  

Growth rate (g) = (2.08 - 2.00) / 2   =  0.04 or 4%

To calculate the price of a stock today whose dividends are growing at a constant rate, we use the constant growth model of DDM. The price of the stock today under this model is,

P0 = D1 / ( r - g )

Where,

Thus, to calculate the price of the stock today at t=10, we will use the dividend expected in Year 11 or D11.

D11 = D0 * (1+g)^11

Where P10 is the price 10 years from today.

P10 = 2 * (1+0.04)^11 / (0.08 - 0.04)

P10 = $76.97

Answer:

This statement is True

Explanation:

Benchmarking by definition involves evaluating services, workflow and other best practices of an organizations so that other companies of similar profile and size can learn from them. This is used in analysis and comparison to that of a similar company for the purpose of organizational improvement. In hotel industry, it can be in form of continuously measuring operational performance in revenues & occupancy rates, customer service excellence and employee incentive programs.

Answer:

Equilibrium quantity will increase; Equilibrium price is ambiguous.

Explanation:

If the government removes a tax on the production of beer then as a result the producers of beer will increase their production level and this will increase the supply of beer in an economy. Therefore, there is a rightward shift in the supply curve of beer.

Simultaneously, the students are ready to party in the new quarter which indicates that the demand for beer increases. This will shift the demand curve for beer rightwards.

As a result of these shift in the demand curve and in the supply curve of beer, the equilibrium quantity of beer increases and the effect on equilibrium price of beer is ambiguous because that will be dependent upon the magnitude of the shift in the demand and supply curve.

Answer:

$6,600

Explanation:

The units-of-production depreciation expense = (miles driven in year 2 / total estimated miles) × (cost of asset - Salvage value)

(20,000 / 100,000) x ($41,000 - $8,000)

0.2 x $33,000 = $6,600

I hope my answer helps you

Answer:

$9,760

Explanation:

For computing the depreciation expense first we have to find out the depreciation rate which is shown below:

The computation of the depreciation per miles under the units-of-production method is shown below:

= (Original cost - residual value) ÷ (estimated miles)

= ($138,000 - $16,000) ÷ (1,000,000 miles)

= ($122,000) ÷ (1,000,000 miles)

= $0.122 per miles

Now for the first year, it would be

= Miles driven in first year × depreciation per miles

= 80,000 miles × $0.122 per miles

= $9,760

Answer:

Net increase in cash position is $18,960

From operations $128,160

From investing activities -$83,200

From Finance activities -$26,000

Explanation:

The income statement has been uploaded for your benefit.

The schedules attached tagged "workings" explains how we arrived at each change in cash flow by line item.

The cash flow statement is one of the most important forms of the financial statement being prepared at the end of the financial period to record the inflow and outflow of the cash by various business activities. It can be prepared either by direct or indirect method.

It bifurcates the transactions into three activities: Operating activity, investing activity, and financing activity.

The cash flow statement by the direct method is attached below in the image.

To know more about cash flow statements, refer to the link:

https://brainly.com/question/2693044

Answer:

[tex]W_D=0.0843\\W_I=0.9157[/tex]

Explanation:

A minimum variance portfolio is a portfolio that consists of individually assets which are risky, hedged when traded together, thereby producing the lowest possible risk for the rate of expected return. It reduces the risk of assets by hedging and trading them together.

Given that for stock D:

expected return([tex]E_d[/tex]) = 19% = 0.19 and a standard deviation ([tex]S_d[/tex])=  35% = 0.35

For stock I

expected return ([tex]E_i[/tex]) = 10% = 0.10 and a standard deviation ([tex]S_i[/tex]) =  15% = 0.15

Correlation = -0.04

The weight of stock D ([tex]W_D[/tex]) is given as:

[tex]W_D=\frac{S_i^2-(S_d*S_i*c)}{S_d^2+S_i^2-(2*S_d*S_i*c)} =\frac{0.1^2-(0.35*0.1*-0.04)}{0.35^2+0,1^2-(2*0.35*0.1*-0.04)}=0.0843[/tex]

[tex]W_I=1-W_D=1-0.0843=0.9157[/tex]

Final answer:

The weights of Stock D and Stock I in the minimum variance portfolio are calculated using the formula that takes into account their individual variances and the correlation between them. The resulting weights will balance the portfolio to minimize overall risk.

Explanation:

To calculate the weights of each stock in the minimum variance portfolio, we use the formula for the weights of two assets in such a portfolio:

Weight of Stock D (
wD) = (\sigmaI2 - \rhoDI\sigmaD\sigmaI) / (\sigmaD2 + \sigmaI2 - 2\rhoDI\sigmaD\sigmaI)

Weight of Stock I (
wI) = (\sigmaD2 - \rhoDI\sigmaD\sigmaI) / (\sigmaD2 + \sigmaI2 - 2\rhoDI\sigmaD\sigmaI)

Using the given values for Stock D and Stock I:

Substituting the values into the formulas gives us:

After calculations, we find the weights in the minimum variance portfolio:

Complete Question:

Sarah has learned a lot from you over the past two months, and has compiled the following data for Sole Purpose Shoe Company for September using the techniques you taught her. She would like your help in preparing a Budget Performance Report for September. The company produced 3,000 pairs of shoes that required 10,500 units of material purchased at $8.20 per unit and 8,100 hours of labor at an hourly rate of $8.90 per hour during the month. Actual factory overhead during September was $25,200. When entering variances, use a negative number for a favorable cost variance, and a positive number for an unfavorable cost variance.

Use the data in the following table to prepare the Budget Performance Report for Sole Purpose Shoe Company for September.

Manufacturing Costs Standard Price Standard Quantity Standard Cost Per Unit

Direct materials $8.40 per unit 3.6 units per pair $30.24

Direct labor $8.50 per hour 2.8 hours per pair 23.80

Factory overhead $2.80 per hour 2.8 hours per pair 7.84

Total standard cost per pair   $61.88

Sole Purpose Shoe Company

Budget Performance Report

For the Month Ended September 30

1  Manufacturing     Costs  Actual Costs  Standard         Cost at Actual Volume

Cost Variance - (Favorable) Unfavorable

2  Direct materials

3  Direct labor

4  Factory overhead

5  Total manufacturing costs

Before Sarah makes any changes based on the Budget Performance Report for September, she wants to be sure she understands the results, and has the following questions for you.

Answer the following questions (1) and (2). All questions pertain to the September data.

1. What caused the total cost variance for direct materials? Check all that apply.

The actual quantity of direct materials per unit was less than the standard quantity.

A factor other than those listed caused the total cost variance for direct materials.

The actual price for direct materials per unit was less than the standard price.

The favorable price variance dominated the unfavorable quantity variance, causing the total cost variance for direct materials to be favorable.

The unfavorable quantity variance dominated the favorable price variance, causing the total cost variance for direct materials to be unfavorable.

2. What caused the total cost variance for direct labor? Check all that apply.

The actual rate for labor hours per unit was less than the standard rate.

The actual number of labor hours per unit was less than the standard number.

A factor other than those listed caused the total cost variance for direct labor.

The unfavorable rate variance was larger than the favorable time variance, causing the total cost variance for direct labor to be unfavorable.

The favorable time variance was larger than the unfavorable rate variance, causing the total cost variance for direct labor to be favorable.

Answer and explanation:

Sole purpose shoe company                                                                                                      

Budget performance report                                                                                                  

For the month ended September 30                                                                                      

check the attached image for a well formatted table

Answer:

Debit Depreciation expense   $14,400

Credit Accumulated depreciation  $14,400

(1)  Debit Other income/disposal account (p/l)  $201,600

    Credit Fixed Asset account   $201,600

    Debit Accumulated depreciation account   $129,600

    Credit Other income/disposal account (p/l)   $129,600

    Debit Cash account    $63,000

    Credit Other income/disposal account (p/l)    $63,000

(2) Debit Other income/disposal account (p/l)  $201,600

    Credit Fixed Asset account   $201,600

    Debit Accumulated depreciation account   $129,600

    Credit Other income/disposal account (p/l)   $129,600

    Debit Cash account    $52,920

    Credit Other income (p/l)    $52,920

Explanation:

Depreciation is the systematic allocation of the cost of an asset to the income statement over the estimated useful life of that asset.

It is determined as the depreciable value of the asset over the estimated useful life of the asset where the depreciable value is the difference between the cost and salvage value of the asset

Mathematically,  

Depreciation = (Cost - Salvage value)/Estimated useful life

Annual Depreciation = $201,600/7

= $28,800

Between January and July 1 is 6 months hence depreciation

= 6/12 * $28800

= $14,400

Accumulated depreciation at time of sale/destruction

= 4*$28800 + $14400

= $129,600

When the amount received from the disposal of an asset is higher than the carrying value of the asset, the company makes a gain on disposal. The proceed from the disposal of an asset may be recorded in the disposal or other income account.

On disposal, the carrying amount of the asset is derecognized by  

Debit Other income/disposal account (p/l)

Credit Asset account  

with the cost of the asset, then,

Debit Accumulated depreciation account

Credit Other income/disposal account (p/l)

With the accumulated depreciation of the asset at the date of disposal,

Furthermore,

Debit Cash account

Credit Other income/disposal account (p/l)

with the amount received from the disposal or sale of the asset

Answer:

Entries to record the partial year's depreciation on July 1, 2021:

Debit Depreciation expense ($28,800x0.5)       $14,400

Credit Accumulated depreciation                        $14,400

(To record accumulated depreciation - Jan. 1 - July 1, 2021)

(1) The following journals apply, if the machine is sold for $63,000 cash:

Debit Accumulated depreciation                       $129,600

Debit Loss on asset disposal                                 $9,000

Debit Cash                                                            $63,000

Credit Machine cost (fixed asset)                       $201,600

(To record asset disposal)

(1) The following journals apply, if there was an insurance settlement of $52,920:

Debit Accumulated depreciation                                    $129,600

Debit Loss on asset disposal ($52,920 - $72,000)          $19,080

Debit Cash                                                                          $52,920

Credit Machine cost (fixed asset)                                    $201,600

(To record asset disposal)

Explanation:

Under straight-line method, depreciation is an allocation of the cost of an asset over its estimated useful life and it is expressed with this formula: (cost - residual value) / No of years = ($201,600 - 0) / 7 years = $28,800 yearly depreciation expense.

Accumulated depreciation on July 1, 2021 (4.5 Years) is $28,800 x 4.5 years $129,600.

So, the net book value (NBV) of the asset (expressed as Cost - Accumulated depreciation) is $201,600 - $129,600 = $72,000

Gain or loss on disposal = Sales proceed - NBV = $63,000 - $72,000 = $9,000 (loss)

Answer and Explanation:

a. The journal entries are shown below:

Cash Dr $2,040,000        (40,000 shares × $51)

      To Preferred stock  $2,000,000      (40,000 shares × $50)

      To Paid in capital in excess of par - Preferred stock  $40,000

(Being the issuance of preferred stock is recorded)

Since the cash is increased so it would be debited along with it the stockholder equity is also increased so preferred stock is credited and the remaining balance is transferred to the paid in capital

Cash Dr $3,360,000        (60,000 shares × $56)

      To Preferred stock  $3,000,000      (60,000 shares × $50)

      To Paid in capital in excess of par - Preferred stock  $360,000

(Being the issuance of preferred stock is recorded)

Since the cash is increased so it would be debited along with it the stockholder equity is also increased so preferred stock is credited and the remaining balance is transferred to the paid in capital

b. The posting is as follows

                                        Preferred Stock

 Date           Debit             Date                Credit

                                                   1-Feb           $2,000,000

                                                   1-Jul           $3,000,000

                       Paid in capital in excess of par - Preferred stock

Date           Debit            Date                 Credit

                                                  1-Feb               $40,000

                                                  1-Jul                $360,000

c. As we know that the stockholder equity comprises of common stock, preferred stock, retained earning, treasury stock, etc

So, the presentation of the accounts is

Preferred stock, $50 par value, 100000 outstanding and issued - $5,000,000

Paid in capital in excess of par - Preferred stock - $400,000

These amount are a sum of preferred stock and paid in capital in excess of par

Final answer:

Journal entries for Penland Corporation's preferred stock issuance record cash inflows and the value of the stock at par, along with additional paid-in capital representing the premium over the par value. T-accounts reflect these transactions in stockholders' equity. The preferred stock would be presented in the equity section of the balance sheet, showing both the par value and the premium.

Explanation:

The student's question relates to journalizing and posting the preferred stock transactions for Penland Corporation and discussing the statement presentation of the preferred stock accounts.

Journal Entries:

(To record issuance of 40,000 shares of preferred stock at $51)

July 1 - Cash $3,360,000

(To record issuance of 60,000 shares of preferred stock at $56)

T-Accounts for Stockholders' Equity

Account                                                               -             Credit

Preferred Stock                                                            $5,000,000

Paid-in Capital in Excess of Par, Preferred                    $400,000

The statement presentation of the preferred stock would show the par value times the number of shares issued, with an additional line item for the 'Paid-in Capital in Excess of Par' representing the premium over the par value paid by investors. The total stockholders' equity would include these amounts as part of the total equity.

Answer:

Explanation:

Attached is the solution

The schedule variance is $83,000, the schedule performance index is approximately 1.005, and the cost performance index is approximately 1.090.

To calculate the schedule variance (SV), schedule performance index (SPI), and cost performance index (CPI) for the project to date, we need to use the following formulas:

 1. Schedule Variance (SV): SV = (Earned Value) - (Planned Value)

2. Schedule Performance Index (SPI): SPI = (Earned Value) / (Planned Value)

3. Cost Performance Index (CPI): CPI = (Earned Value) / (Actual Cost)

First, we need to determine the Earned Value (EV), Planned Value (PV), and Actual Cost (AC) for each activity and for the project as a whole.

For the first activity (prepping the site):

- EV = AC = $1,315,000 (since the activity is 100% complete)

- PV = $1,435,000 (as planned)

For the second activity (pouring concrete):

- EV = AC = $9,015,000 (since the activity is 100% complete)

- PV = $10,515,000 (as planned)

For the third activity (construction of the bridge superstructure):

- EV = $8,515,000 x 0.75 = $6,386,250 (since the activity is 75% complete)

- PV = $8,515,000 x 0.55 = $4,683,250 (as planned)

- AC = $5,015,000 (as spent)

Now, we can calculate the total EV, PV, and AC for the project:

- Total EV = [tex]EV1 + EV2 + EV3[/tex] = $1,315,000 + $9,015,000 + $6,386,250 = $16,716,250

- Total PV =[tex]PV1 + PV2 + PV3[/tex] = $1,435,000 + $10,515,000 + $4,683,250 = $16,633,250

- Total AC = [tex]AC1 + AC2 + AC3[/tex] = $1,315,000 + $9,015,000 + $5,015,000 = $15,345,000

Now we can calculate the SV, SPI, and CPI:

1. Schedule Variance (SV): SV = Total EV - Total PV

SV = $16,716,250 - $16,633,250 = $83,000

2. Schedule Performance Index (SPI): SPI = Total EV / Total PV

SPI =[tex]$16,716,250 / $16,633,250 ≈ 1.005[/tex]

3. Cost Performance Index (CPI): CPI = Total EV / Total AC

CPI = [tex]$16,716,250 / $15,345,000 ≈ 1.090[/tex]

Therefore, the schedule variance is $83,000, the schedule performance index is approximately 1.005, and the cost performance index is approximately 1.090. This indicates that the project is slightly ahead of schedule and under budget.