Answer: <em>Total Period Cost = $20,500</em>
Explanation:
Given :
Salary = $4000
Factory supply = $1000
Indirect labor = $6000
Direct material = $16000
Advertising expense = $2500
Office expense = $14000
Direct labor = $20000
Period costs are the costs incurring that do not tend to be a section of manufacturing process. Therefore, we compute the Period Cost using the following formula:
<em>
Period costs = Salary + Advertising expense + Office expense
</em>
<em>
= $4,000 + $2,500 + $14,000
</em>
<em>
= $20,500</em>
Answer:
$7,986
Explanation:
To calculate the equivalent annual cost for 5 year period at an interest rate of 10% per year we need to go through some minor calculations first.
DATA
Cost in first year (A) = $10,000
Decrease in cost each year after the first year (G) = $560
Interest rate = 10%
Time period = 5 years
Solution
EAC = A - G (A/G, i, n)
EAC = $9,000 - $560(A/G, 10%, 5)
EAC = $9,000 - ($560 * 1.8101)
EAC = $9,000 - $1,013.656
EAC = $7,986
Answer:
a) $8
b) $4
c) Decrease
Explanation:
Background.
A call option as you probably know, is an agreement to buy an asset on or before a particular day at a price already determined in the agreement.
a) the Intrinsic value of the option is the market price minus the strike price.
Intrinsic Value = Market Price - Strike price
= $43 - $35
= $8 per share.
It is worthy of note that for an option, of the intrinsic value dips into negative figures it is just said to be 0.
b) To calculate the time value, we subtract the intrinsic value from the call premium
= Call Premium - Intrinsic value
= $12 - $8
= $4
c) The call option has 6 months to maturity and the dividends are to come in 3 months. Share prices usually drop after a dividend has been paid so because the call option matures in 6 months, the price of the call option will DECREASE owing to the Expected drop in stock price.
Answer:
The firm's receivable turnover is 20 times
Explanation:
The computation is shown below:
Accounts receivable turnover ratio = (Credit sales ÷ average accounts) receivable
where,
Average accounts receivable = (Opening balance of Accounts receivable + ending balance of Accounts receivable) ÷ 2
= ($0 + $50,000) ÷ 2
= $25,000
And, the net credit sale is $500,000
Now put these values to the above formula
So, the answer would be equal to
= ($500,000 ÷ $25,000)
= 20 times
And, the average collection period in days = Total number of days in a year ÷ accounts receivable turnover ratio
= 360 days ÷ 20
= 18 days
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