Inventory Valuation under Variable CostingDuring the most recent year, Judson Company had the following data associated with the product it makes:

Units in beginning inventory 300
Units produced 15,000
Units sold ($300 per unit) 12,700
Variable costs per unit:
Direct materials $20
Direct labor $60
Variable overhead $12
Fixed costs:
Fixed overhead per unit produced $30
Fixed selling and administrative $140,000

Required:

1. How many units are in ending inventory?
$ _______ units
2. Using variable costing, calculate the per-unit product cost.
$_____________
3. What is the value of ending inventory under variable costing?
$___________

Answers

Answer 1
Answer:

Answer:

1.  Ending inventory = Beginning inventory + Production - Sales

                            = 300 units + 15,000 units - 12,700 units

                            = 2,600 units  

2. Per unit Product Cost Using Variable Costing

                                  $

Direct material         20

Direct labor              60

Variable overhead   12

Product cost          92

3.  Value of ending inventory under variable costing

    =  2,600 units x $92

    = $239,200            

                                                                                                             

Explanation:

The units of ending inventory is calculated as beginning inventory plus  production minus sales.

Per unit product cost is the aggregate of variable cost per unit. This includes direct material cost, direct labour cost and variable overhead.

Value of ending inventory is the product of units of ending inventory and per unit product cost.


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Holmes Company produces a product that can be either sold as is or processed further. Holmes has already spent $96,000 to produce 1,375 units that can be sold now for $89,500 to another manufacturer. Alternatively, Holmes can process the units further at an incremental cost of $290 per unit. If Holmes processes further, the units can be sold for $440 each. Should Holmes sell the product now or process it further

Answers

Answer:

Yes

Explanation:

The computation is shown below:

Particulars         Sales As Is   Process further     Incremental Accounting

Sales            $89,500       $605,000               $515,500

                                             (1,375 units × $440)

Less:

Additional Process costs $398,750                $398,750

                                          (1,375 units × $290)

Total           $89,500       $206,250                $116,750

Based on the incremental income, Holmes should process it further.

Which of the following statements about financial statement analysis is most correct? a. The current ratio is the best available measure of liquidity.

b. Du Pont analysis is based on the fact that return on equity (ROE) can be expressed as the sum of four other ratios.

c. It is relatively easy to interpret a ratio in the absence of comparative data.

d. There are no limitations to financial statement analysis, so analysts can always be confident of their conclusions.

e. None of the above statements is correct.

Answers

Answer:

The answer is e) None of the above statements is correct.

Explanation:

The current ratio, which measures the coverage of current assets against current liabilities, though used widely faces the limitation that it does not adequately reflect how well a company pays-off its short term debt. In simple terms, a high current ratio indicating how well a company pays short term debt is not forcefully appreciated in a given economic condition. as it is affected by elements such as time for collectinig bills. This is why to move in line with the going-concern principle, the acid test ratio is the best available measure of liquidity.

Du pont analysis is a form of financial ratio tools that comprises of 3 other financial ratios to provide better comprehension of the Return on Equity of a company. That is Net Profit Margin, Asset Turnover and Totat assets to Total equity ratios.

Interpretation of financial ratios requires the use of data so as to provide a comparison and determine the changes in the financial position of a company.

There are existing limitations to financial statement analysis such as the effect of inflation, the fact that data used for comparison is based on past information and it becomes to hard to predict the future. Considering these, analysts should rather be careful when communicating financial information.

Final answer:

The correct answer is 'b' - Du Pont's analysis is based on a relationship between ROE and three other ratios, not four. The statement 'a' isn't entirely true as the current ratio ignores the type and quality of current assets. Statements 'c' and 'd' are incorrect as analyzing a ratio without comparative data is misleading and limitations exist in financial statement analysis.

Explanation:

The correct statement about financial statement analysis is option 'b. Du Pont's analysis is based on the fact that return on equity (ROE) can be expressed as the product of three other ratios: the net profit margin, the total assets turnover, and the financial leverage ratio, not four. It's crucial to note that, while the current ratio can provide insight into a company's liquidity, it's not universally 'the best' measure because it fails to account for the nature and quality of current assets. Statements 'c' and 'd' are also incorrect; interpreting ratio data without comparative data lacks context and can be misleading, and financial statement analysis does have limitations such as not considering non-financial factors or possible manipulation of financial statements.

Learn more about Financial Statement Analysis here:

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Two towns, each with three members, are deciding whether to put on a fireworks display to celebrate the New Year. Fireworks cost $300. In each town, some people enjoy fireworks more than others.In the town of Bayport, each of the residents values the public good as follows:

Resident Value
(Dollars)
Darnell 70
Eleanor 90
Jacques 150
The total benefit of the fireworks display to the town of Bayport is ($ ).

Therefore, fireworks (would/would not) pass the cost-benefit analysis in the town of Bayport.

The mayor of Bayport proposes to decide by majority rule and, if the fireworks referendum passes, to split the cost equally among all residents.

Who would vote in favor of the fireworks referendum? Check all that apply.

Darnell

Eleanor

Jacques

Answers

Answer:

Thus, option b and c are correct.

Explanation:

Suppose that there are two towns. Each town has three members to put on a fireworks display. The cost of fireworks is $300.

Find the total benefits of the fireworks display to the town of B.

Total benefit = value to Darnell + value to eleanor + value to Jacques

= 70+90+150 =$310

Thus, total benefit of the fireworks display to the town of B is $310.

Since the total benefits to the persons is greater than the total costs, therefore, fireworks would pass the cost- benefits analysis in the town of B.

The mayor of B said to spilt the cost among all the residents. Each of the residents will bear s $100 ($300/3).

Darnell and Eleanor will not vote for this because cost to them is more than the value to them. Remaining Jacques

will vote for this because cost to him is less than the value to him for this.

Thus, Jacques will vote in favor of this.

Thus, option c is correct.

Therefore, vote would not yield the same answer as the cost-benefit analysis.

Find the total benefits of the fireworks display to the town of RH.

Total benefit = value to kyoko + value to Musashi + value to Rina

= 50 +110+ 120 = $280

Thus, total benefit of the fireworks display to the town of RH is $280.

Since the total benefits to the persons is less than the total costs, therefore, fireworks would not pass the cost- benefits analysis in the town of RH.

The mayor of RH said to spilt the cost among all the residents. Each of the residents will bear $100 &$300/3).

Kyoko will not vote for this because cost to them is more than the value to them. Remaining Musashi and Rina will vote for this because cost to him is less than the value to him for this.Thus, Musashi and Rina will vote in favor of this.

Thus, option b and c are correct.

Therefore, vote would not yield the same answer as the cost-benefit analysis.

The following statements are correct about the provision of public goods.

It is hard for the government to decide the appropriate amount of public goods to produce because people have differing preferences regarding such goods. Thus, option b is correct.

An investment has the following characteristics:ATIRRP: After-tax IRR on total investment in the property: 9.0%BTIRRE: Before-tax IRR on equity invested: 17%BTIRRP: Before-tax IRR on total investment in the property: 12%t: Marginal tax rate: 0.40What would be the break-even interest rate (BEIR), at which the use of leverage neither favorable nor unfavorable? (A)(A) 15.0%(B) 20.0%(C) 22.5%(D) 28.3%

Answers

Answer:

Option (A) is correct.

Explanation:

Given that,

After-tax IRR on total investment in the property = 9.0%

Before-tax IRR on equity invested = 17%

Before-tax IRR on total investment in the property = 12%

t: Marginal tax rate = 0.40

Break Even Interest rate (neither favorable nor unfavorable):

= After tax IRR on total investment ÷ (1 - Tax rate )

= 9% ÷ (1 - 0.40)    

= 9% ÷ 0.60

= 15%

The best way to investigate fraudulent transactions on your credit card is to:

Answers

you can check on your account online or when you get your statement it will have all the charges from that billing period.

Suppose there is a policy debate regarding the United States’ imposing trade restrictions on imported steel rods. Read the following scenario and answer the question that follows.
The president of the United States argues that the United States should threaten to impose a tariff on Chinese steel rods in order to induce the Chinese to remove its tariff on American cars.
Which of the following justifications is the pundit using to argue for the trade restriction on steel rods?

a. National-security argument
b. Infant-industry argument
c. Jobs argument
d. Using-protection-as-a-bargaining-chip argument
e. Unfair-competition argument

Answers

Jobs argument justifications is the pundit using to argue for the trade restriction on steel rods

Explanation:

A main argument often put forward to curb trade would be that trade decreases the amount of jobs domestically available.

The point about maintaining jobs is often put forward by employers to protect union jobs. Nevertheless, unions are undermining the market by prohibiting businesses from receiving their products at lower prices, causing them to increase prices. Moreover, businesses are often discouraged from using automation or robotics to retain jobs, which is ironic because automation and robotics improve the productivity of workers, thereby encouraging companies to pay employee salaries and benefits.