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2 years ago

Warnerwoods Company uses a perpetual inventory system.

Business

1 answer:

Liono4ka [1.6K]2 years ago

8 0

Answer:

gross profit under FIFO = $40,570 - $25,220 = $15,350

gross profit under LIFO = $40,570 - $26,340 = $14,230

gross profit under weighted average = $40,570 - $26,240 = $14,330

gross profit under specific id. = $40,570 - $26,070 = $14,500

Explanation:

sales revenue = (290 x $86.60) + (160 x $96.60) = $40,570

COGS under FIFO:

130 x $51.60 = $6,708

160 x $56.60 = $9,056

80 x $56.60 = $4,528

80 x $61,60 = $4,928

total COGS = $25,220

COGS under LIFO:

240 x $56.60 = $13,584

50 x $51.60 = $2,580

160 x $63.60 = $10,176

total COGS = $26,340

COGS under weighted average:

weighted average = [(130 x $51.60) + (240 x $56.60) + (100 x $61.60) + (180 x $63.60)] / 650 = $58.31

450 x $58.31 = $26,239.50 ≈ $26,240

COGS under specific method:

80 x $51.60 = $4,128

210 x $56.60 = $11,886

60 x $61.60 = $3,696

100 x $63,60 = $6,360

total COGS = $26,070

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Parvis makes all sales on account, subject to the following collection pattern: 20% are collected in the month of sale; 70% are

Bumek [7]

Answer:

Balance as on 31st December = $46,000

Explanation:

Sales October November December Balance

October $70,000 $14,000 $49,000 $7,000 $0

November $60,000 $12,000 $42,000 $6,000

December $50,000 $10,000 $40,000

Balance as on 31st December $46,000

Workings

October: 20% of 70,000 = 14,000, 70% of 70,000 = $49,000, 10% of 70,000 = $7,000

November = 20% of 60,000 = 12,000, 70% of 60,000 = $42,000, Balance = 60,000 - (12,000+42,000) = $6,000

December = 20% of 50,000 = $10,000, Balance = 50,000 - 10,000 = $40,000

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2 years ago

Bonds are considered to offer a guaranteed return, as they must be honored by law, but which is still a potential risk that inve

Fiesta28 [93]

Bonds are a type of investments that is categorized as a fixed-income instrument which symbolizes loans that investors make to a borrower. Bonds can be made by a corporation or a government. Bonds always have end dates, and they generally have lower risks compared to stocks.

However, there are still some risks associated with this type of instrument, which is (C) the issuer could go bankrupt.

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2 years ago

Read 2 more answers

Zan Azlett and Angela Zesiger have joined forces to start A&Z Lettuce Products, a processor of packaged shredded lettuce f

krek1111 [17]

Answer:

a. The break-even quantity in units for manual process= 26,786 bags

b. $80,358

c. 36,000 bags

d. $108,000

e. $53,000

f. $58,000

g. 26,786 bags

h. mechanized process, manual process.

Explanation:

a. Using the formula

Fixed Costs ÷ (Revenue per Unit – Variable Cost per Unit)

= $ 37, 500÷$3- $ 1.60

=26,786

b. Using the formula

Break-Even Point (sales dollars) = Fixed Costs ÷ Contribution Margin

where Contribution Margin = Price of Product – Variable Costs

=37, 500÷($3- $ 1.60)

=26,786 x $3= $80,358

c. Using the formula

Fixed Costs ÷ (Revenue per Unit – Variable Cost per Unit)

= $ 72,000÷$3- $1

=36,000 bags

d. Using the formula

Fixed Costs ÷ Contribution Margin

where Contribution Margin = Price of Product – Variable Costs

= $ 72,000÷($3- $1)

=36,000 bags x $3= $108,000

e. 65,000 bags x $3-$1.60= $91,000-$37,500 (manual process fixed cost)

= $53,000

f. 65,000 bags x $3-$1= $130,000-$72,000 (manual process fixed cost)

= $58,000

h. The mechanized process option should be chosen as this would bring more returns if the demand exceeds the point of indifference and the manual process if the demand stays below the point of indifference.

8 0

2 years ago

Jeremy is studying the effects of income on the demand for Greek ceramics. If "ceteris paribus" is used, which factors would be

aliya0001 [1]

Answer:

B) all factors affecting demand, except income

Explanation:

Ceteris paribus can be used to identify the relationship between two specific variables, while leaving all other factors constant. In this case, since Jeremy is studying the effects of income on the demand (of anything really, not only Greek ceramics), it should affect all factors affecting demand except income. Jeremy is going to analyze how the quantity demanded changes when the income changes, all other things constant.

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2 years ago

Hilltop Paving has a levered equity cost of capital of 14.92 percent. The debt-to-value ratio is 0.4, the tax rate is 34 percent

Klio2033 [76]

Answer:

c. 12.56%

Explanation:

Debt-to-value=D/(D+E) =0.4=> D=0.4D + 0.4E => 0.6D = 0.4E => D/E=4/6=2/3

According to M&M proposition II with taxes,

re=r0+(D/E)(r0-rd)(1-Tax rate) . Where re= levered cost of equity(or cost of equity when the firm is levered)=.1492, r0 = unlevered cost of equity,Tax rate=34%=.34, rd=pretax cost of debt=7.2%=0.072,D/E=2/3

re = r0+(2/3) * (r0 - 0.072)*(1-.34)

=> 0.1492=r0(1+(2/3)*(1-.34)) -(2/3)*(.072)*(1-.34)

=> 0.1492 = r0(1+0.44) -0.03168

=> 0.1492 = 1.44*r0 -0.03168

r0 = (.1492+0.03168)/1.44

r0 =0.1256

r0 =12.56%

Thus, r0=unlevered cost of equity=12.56%

8 0

2 years ago