Answer:
A. Differentiation strategy.
Explanation:
In a market different firms try to maintain a competitive edge over others. This is achieved by using various strategies like: Differentiation strategy, Local strategy, Regional strategy, Cost-leadership strategy, Global strategy.
In the given scenario ABC tries to add value to their products and services so they can attract customers who are willing to pay a higher price.
This is a differentiation strategy where a firm tries to make their product different from.otgers in order to maintain a competitive advantage over others
The ____ is equal to the sum of the squares of the market shares of all the firms in an industry. a. market concentration ratio b. Herfindahl-Hirschman index c. correlation coefficient d. standard deviation of concentration e. none of the above
Answer:
b. Herfindahl-Hirschman index
Explanation:
Option b. Herfindahl-Hirschman index
The HHI is calculated by taking the square of the market share and then adding all the squared values. Thus, the resulting answer will be the HHI magnitude.
The Assembly Department started the month with 83,000 units in its beginning work in process inventory. An additional 334,000 units were transferred in from the prior department during the month to begin processing in the Assembly Department. There were 34,000 units in the ending work in process inventory of the Assembly Department. How many units were transferred to the next processing department during the month
Answer:
383,000
Explanation:
Calculation to determine How many units were transferred to the next processing department during the month
Work in process, beginning 83,000
Add Units started into production during the month 334,000
Less Work in process, ending (34,000)
Units completed and transferred out during the month 383,000
(+83,000+334,000-34,000)
Therefore How many units were transferred to the next processing department during the month is 383,000
Tại sao nói Marketing vừa là khoa học, vừa là nghệ thuật?
Answer:
Sorry I can't understand.....
Use the following scenario for the question below. A group of 100 people seeks out an insurance company to underwrite health insurance for its members. The expected medical spending for the group is $150,000. Assume a net loading cost of 15 percent. If an additional 10 people, who have expected medical spending of $5,000 per person on average, join the group, the new premium will be approximately: a. $2,100. b. $2,300. c. $1,818. d. $3,090. e. $5,822.
The new premium given the medical spending and the number of people will be approximately $2,100
How to find new premiumGiven:
Number of people = 100Additional people = 10Total = 110Medical spending = $150,000Medical spending per person (additional) = $5000
Medical spending for additional people = $5,000 × 10
= $50,000
Total medical spending = $150,000 + $5,000
= $200,000
Average per person = Total medical spending / number of persons
= $200, 000 / 110
= $1818.18181818181
Net loading cost = 15%
New premium = 1818.18181818181 + (15% of 1818.18181818181)
= 1818.18181818181 + 272.727272727272
= $2090.90909090909
Approximately,
$2,100
Learn more about insurance:
https://brainly.com/question/4953989
If a firm's marginal tax rate is increased, this would, other things held constant, lower the cost of debt used to calculate its WACC. True False
Answer:
The answer is "True".
Explanation:
The marginal rate is indeed the extra income tax about any dollar earned as income. Its annual tax rate is the total tax paid divided by the total earnings. This marginal rate of 10% will impose a tax of 10 cents on every following income spent. that's why the given statement is true because the cost of debt [tex]= k\times (1-t)[/tex] and its t value will increase the cost of the decrease.
ba 101 Jane has discovered that she is bored and frustrated working for others. She wants to open a business where she alone will have control and the least interference from government regulation. Which form of business would best meet her needs
Answer: Sole proprietorship
Explanation:
Sole proprietorship is also called the sole trader or one man business. This is a form of business that's owned and.conteoooed by a single person.
A sole proprietorship is regarded as the easiest form of business to set up due to lack of government regulation. Since Jane wants to have control and the least interference from government regulations, this form of business is appropriate.
who has given general principle of management?
Answer:
I think it's " Henri Fayol's "
Answer:
14 management principle of Henri Fayol
Explanation:
1. Division of work or division labor.
2. Balancing Authority and responsibility.
3. Discipline.
4. Unity of command.
5. Unity of Direction.
6. Subordination of individual interest to the general interest.
7. Remuneration.
8. Centralization.
9. Scalar chain.
10. Order.
11. Equity.
12. Stability of tenure of personal.
13. Initiative.
14. Esprit de corps.
Last month when Holiday Creations, Inc., sold 35,000 units, total sales were $300,000, total variable expenses were $234,000, and fixed expenses were $38,700.
Required:
1. What is the company’s contribution margin (CM) ratio?
2. What is the estimated change in the company’s net operating income if it can increase total sales by $2,500?
Answer:
See below
Explanation:
1. Contribution margin ratio
= (Sales - Variable cost) / Sales
Sales = $300,000
Variable cost = $234,000
Contribution margin = ($300,000 - $234,000) / $300,000
= 0.22
= 22%
Hence, contribution margin ratio is 22%
2. Change in the net operating income if it can increase total sales by $2,500
Contribution margin of $2,300 = $2,300 × 22%
= $506
Operating income for $300,000 sales is
= Sales - total variable expenses - fixed expenses
= $300,000 - $234,000 - $38,700
= $27,300
If sales is $302,500 the net operating income would be
= $27,300 + $506
= $27,806
• It therefore means that the net operating income will increase by $506
Assume for the United States that the opportunity cost of each airplane is 50 cars. Which of these pairs of points could be on the United States' production possibilities frontier?a. (200 airplanes, 5,000 cars) and (150 airplanes, 4,000 cars)b. (200 airplanes, 12,500 cars) and (150 airplanes, 15,000 cars)c. (300 airplanes, 15,000 cars) and (200 airplanes, 25,000 cars)d. (300 airplanes, 25,000 cars) and (200 airplanes, 40,000 cars)
Answer: b. (200 airplanes, 12,500 cars) and (150 airplanes, 15,000 cars)
Explanation:
The opportunity cost of an airplane is 50 cars. This means that if the number of planes produced were reduced by 50, the number of cars should increase by:
= 50 * 50
= 2,500 cars.
In option B, the airplanes were 200 and then reduced by 50 to 150. This led to an increase in cars of:
= 15,000 - 12,500
= 2,500 cars
Option B therefore satisfies the constraints and is correct.
CWN Company uses a job order costing system and last period incurred $70,000 of actual overhead and $100,000 of direct labor. CWN estimates that its overhead next period will be $85,000. It also expects to incur $100,000 of direct labor cost. If CWN bases applied overhead on direct labor cost, its predetermined overhead rate for the next period should be:
Answer:
85%
Explanation:
With regards to the above information, the predetermined over head is calculated as seen below.
Predetermined overhead = [(Estimated overhead / Expected labor cost) × 100]
Estimated overhead = $85,000
Expected labor cost = $100,000
Then,
Predetermined overhead = [($85,000 / $100,000) × 100]
Predetermined overhead = 0.85 × 100
Predetermined overhead = 85%
Therefore, the predetermined overhead rate for the next period should be 85%
The demand function for a certain commodity is given by , where p is the price per unit and q is the number of units. a. At what price per unit will the quantity b. If the price is $1.87 per unit, demanded equal 8 units
Answer:
(a) The price per unit is $1.83 when the quantity demanded is 8 units
(b) The quantity demanded is approximately 8 units when the price per unit is $1.87
Explanation:
Given
[tex]p = 100e^{-q/2}[/tex]
[tex]p \to[/tex] price per unit
[tex]q \to[/tex] quantity demanded
Solving (a): Price per unit when quantity is 8
This means that we calculate p(8)
We have:
[tex]p(q) = 100e^{-q/2}[/tex]
So:
[tex]p(8) = 100e^{-8/2}[/tex]
[tex]p(8) = 100e^{-4}[/tex]
[tex]p(8) = 1.83[/tex]
Solving (b): Quantity demanded when price per unit is $1.87
This means that:
[tex]p(q) = 1.87[/tex] ---- find q
We have:
[tex]p(q) = 100e^{-q/2}[/tex]
So:
[tex]1.87 = 100e^{-q/2}[/tex]
Divide both sides by 100
[tex]0.0187 = e^{-q/2}[/tex]
Take natural logarithm of both sides
[tex]\ln(0.0187) = \ln(e^{-q/2})[/tex]
[tex]-3.980 = \ln(e^{-q/2})[/tex]
Rewrite as:
[tex]-3.980 = -q/2}*\ln(e)[/tex]
[tex]-3.980 = -q/2[/tex]
Multiply by -2
[tex]7.96 = q[/tex]
[tex]q = 7.96[/tex]
Approximate
[tex]q = 8[/tex]
mention one product you are selling on your sole proprietorship
Answer: Examples of sole proprietors include small businesses such as, a local grocery store, a local clothes store, an artist, freelance writer, IT consultant, freelance graphic designer, etc.
Explanation:
During fiscal year 2018, BHD Inc. had Cash from Operations of $600 million, and Cash Used for Investing of $1,000 million. During the year the Cash account on the balance sheet decreased by $700 million. This implies that the Financing cash flow was an
Answer:
the Financing cash flow is -$300
Explanation:
The computation of the Financing cash flow is given below:
Cash from operations $600
Less: Cash used for investing -$1,000
Cash flow for financing -$300
Decrease in cash -$700
Hence, the Financing cash flow is -$300
The same should be considered and relevant for determining the Financing cash flow
TeaLeaver Inc. has requested Jason, a retiring employee, to train new employees on some essential job duties. In a bid to retain Jason for a short period of time, the company has offered him phased retirement, which means that his _____. Group of answer choices
Answer: offered reduced workload and pay level
Explanation:
Phased retirement is an arrangement in a workplace which allows an employee who is about to retire to continue working but with a reduction in his or her workload and pay level.
Such employees transition eventually from their full time work to their full time retirement. Phased retirement may also allow the employee to take a flexible pension income while he or she still remains in work.
The practice of setting price by increasing the marginal cost of production by some percentage is referred to as: Group of answer choices mark-up pricing percentage pricing rate-of-return pricing average cost pricing
Answer:
markup pricing.
Explanation:
Markup pricing can be regarded as cost-plus pricing which is pricing strategy that involves addition of cost of the products as well as percentage of the cost of product as a markup to calculate the price of a product/service.the company decides
percentage or markup . It should be noted that The practice of setting price by increasing the marginal cost of production by some percentage is referred to markup pricing.
A point outside (to the right of) the production possibilities curve of a nation implies that this nation is using its resources fully. implies that there are unemployed resources in this nation. is easily attainable for this nation. is not attainable for this nation. Submit
Answer:
is not attainable for this nation
Explanation:
The Production possibilities frontiers is a curve that shows the various combination of two goods a company can produce when all its resources are fully utilised.
The PPC is concave to the origin. This means that as more quantities of a product is produced, the fewer resources it has available to produce another good. As a result, less of the other product would be produced. So, the opportunity cost of producing a good increase as more and more of that good is produced.
Point outside the curve or to the right of the curve means that the production level is not attainable given the level of resources
Points inside the production possibilities curve means that the nations resources are not being fully utilised
Factors that cause the PPF to shift
1. changes in technology.
2. changes in available resources.
3. changes in the labour force.
An investment of $1 each in two different securities led to a value of $11 (Security A) and $16 (Security B), respectively, after 15 years. When comparing the rate of return earned by the two securities, it can be said that
a.)Security B earned a higher average annual rate of return.
b.)Security A earned a higher average annual rate of return.
c.both securities earned the same average annual rate of return.
d.)it is impossible to calculate the securities rates of return based on this information.
Answer:
A
Explanation:
The formula for calculating future value:
FV = P (1 + r)^n
FV = Future value
P = Present value
R = interest rate
N = number of years
Security A : 11 = 1( 1 + r)^15
11^(1/15) = 1( 1 + r)
1.173 = 1 + r
r = 1.173 - 1
r = 17.33%
Security A : 16 = 1( 1 + r)^15
16^(1/15) = 1( 1 + r)
1.20 = 1 + r
r = 1.2 - 1
r = 0.2
r = 20%
Security B earned a higher average annual rate of return as 20% is greater than 17.33%
Younes Inc. manufactures industrial components. One of its products, which is used in the construction of industrial air conditioners, is known as P06. Data concerning this product are given below: Per Unit Selling price $ 220 Direct materials $ 38 Direct labor $ 1 Variable manufacturing overhead $ 8 Fixed manufacturing overhead $ 16 Variable selling expense $ 4 Fixed selling and administrative expense $ 16 The above per unit data are based on annual production of 4,000 units of the component. Assume that direct labor is a variable cost. What is the current contribution margin per unit for component P06 based on its selling price of $220 and its annual production of 4,000 units
Answer:
Contribution margin= $169
Explanation:
First, we need to calculate the total unitary variable cost:
total unitary variable cost= direct material + direct labor + variable overhead + variable selling expense
total unitary variable cost= 38 + 1 + 8 + 4
total unitary variable cost= $51
Now, the contribution margin:
Contribution margin= 220 - 51
Contribution margin= $169
Identify the item below that would cause the trial balance to not balance.i. A $1,000 collection of an account receivable was erroneously posted as a debit to Accounts Receivable and a credit to Cash.ii. The purchase of office supplies on account for $3,250 was erroneously recorded in the journal as $2,350 debit to Office Supplies and credit to Accounts Payable.iii. A $50 cash receipt for the performance of a service was not recorded at all.iv. The purchase of office equipment for $1,200 was posted as a debit to Office Supplies and a credit to Cash for $1,200.v. The cash payment of a $750 account payable was posted as a debit to Accounts Payable and a debit to Cash for $750.
Answer:
The item that would cause the trial balance to not balance is:
v. The cash payment of a $750 account payable was posted as a debit to Accounts Payable and a debit to Cash for $750.
Explanation:
The correct record should have been to credit the $750 in the Cash account. By this double debit entries for a transaction without a corresponding credit entry, the trial balance cannot balance as the debit side will be greater by $1,500 ($750 * 2) than the credit side. To correct the error, the Cash account will be credited with $1,500. One of the $750 cancels the earlier error while the second $750 puts the records straight.
Jolene invests her savings in two bank accounts, one paying 3 percent and the other paying 9 percent simple interest per year. She puts twice as much in the lower-yielding account because it is less risky. Her annual interest is 6015 dollars. How much did she invest at each rate?
Answer and Explanation:
The computation is shown below:
Let us assume X be the amount invested at 3%
And, Y be the amount invested at 9%
So,
0.03X + 0.09Y = $6,015 ........(1)
X = 2Y ...........(2)
Now put the value of X in equation 1
0.03(2Y) + 0.09Y = $6,015
0.06Y + 0.09Y = $6,015
0.15Y = $6,015
Y = $40,100
X = 2 × $40,100 = $80,200
The standard deviation for a set of stock returns can be calculated as the: Select one: a. variance squared. b. average squared difference between the actual return and the average return. c. average return divided by N minus one, where N is the number of returns. d. positive square root of the variance. e. positive square root of the average return.
Answer: d. positive square root of the variance.
Explanation:
Standard deviation is used to show the risk on a set of stocks and it is calculated by taking the square root of the variance of those same returns.
The process of finding the standard deviation is to therefore find the average return first and then find the variance of these returns. At this point, the variance will be positive as it is a squared value. Once this value is then taken to its square root, you will have your standard deviation.
You are attempting to value a call option with an exercise price of $109 and one year to expiration. The underlying stock pays no dividends, its current price is $109, and you believe it has a 50% chance of increasing to $142 and a 50% chance of decreasing to $76. The risk-free rate of interest is 12%. Calculate the call option's value using the two-state stock price model.
Answer:
The value of the call option today is $14.29
Explanation:
The two-state stock pricing model is one that prices are based on the assumption that there is no arbitrage profit opportunity as well as the fact that the call option's value will be the present value(PV) of the expected future winnings for long call.
Now, value of the call option if the prices go up will be;
142 - 109 = $32
While if the prices go down, it will be;
76 - 109 = -$33
The call option in this case can only be utilized when the market value exceeds the exercise price.
Therefore, the expected winnings value after one year will be;
Value after one year = (32 × 0.5) + (0 × 0.5)
Value after one year = $16
We used 0 in the multiplication because the call wouldn't be utilized for when the prices go down.
one year from now the long call can be expected to earn $16 .
Thus, today the present value of this amount will be the price of the call option if we take into cognizance that here will be no arbitrage profit opportunity.
With risk-free rate of interest is 12%, we have;
PV = 16/1.12 = $14.29
Case Study
Imagine working in an organization where employee morale is low, turnover is high, and the costs of hiring are astronomical. If that were the case, you'd imagine the employer would go to great lengths to find, attract, and retain quality employees. Couple this goal with the reality of the economic picture -you simply cannot afford to provide expensive benefits for employees who may leave you for a different employer offering an extra $1,000 in salary or benefits. Knowing that 41 percent of all employees have no loyalty to their employers and will move on if a better offer comes adds to the dilemma. These issues clearly are a concern for organizations like Genentech or Zappos. But they don't fret over them. That's because they have found that treating employees with respect, and giving them such things as bonuses, rewards for longevity, onsite child care, lunches, and sending employees home with prepared dinners really works. Genentech is a California company that "develops and produces drugs that cure diseases," according to the company website. The company celebrated its thirteenth year on Fortune's "Best Places to work" list in 2011, also receiving "Best Places to Work" honors from Working Mother, LGBT Equality, and Computerworld. The reasons for this recognition are the important work that they do and the strong company culture that values equality and communication. Any discussion of how great it is to work at Genentech always circles back to the benefits that show a real respect for employees. In addition to traditional benefits like retirement and healthcare, they provide family friendly perks such as unlimited sick leave, personal concierge service, flexible work scheduling, childcare, nursing mother's rooms, onsite nurses, adoption assistance, and company sponsored family events. The list of innovative benefits goes on to include unusual benefits like pet insurance, free snacks, and paid six-week sabbaticals every six years! Zappos, the online shoe retailer, offers perks that match their fun-loving culture like pajama parties, nap rooms, regular happy hours, and a full-time life coach. Have these benefits worked for Genentech and Zappos? Ifyou translate longevity to morale and loyalty, you'd say they have. Both boast low turnover rates and high employee ratings for workplace satisfaction.
Q1) Describe the importance of employee benefits as a strategic component of fulfilling the goals of HRM at Genentech and Zappos?
Q2) Explain how Genentech and Zappos use employee benefits as a motivating tool?
Q3) Do you believe the incentive benefits such as those offered at Genentech and Zappos can be used in other organizations? Why or why not?
Answer:
1) Through employee benefits, the goals of HRM are achieved in effective ways.
2) Genentech also Zappos, try to make it a fun place to go to work at. Genentech and Zappos offer many benefits to employees that would attract and keep employees within the organization.
3) From a knowledgeable view, I actually believe that the motivation benefits as presented by the Genentech and Zappos Corporations can't be employed by other major or maybe small corporations.
Explanation:
1) The importance of employee benefits as a strategic component fulfilling the goals of HRM at Zippos and Genentech is that it can boost low turnover rates and high employee ratings for fulfillment. With placing benefits, employees will have the sensation of being more of an asset to the corporate instead of just being a worker. Thereupon employees would dedicate and put far more effort and time for better for the corporate which might then increase and generate more productivity and profit. When employees desire they need to be benefited from the organization successively they might become loyal to the organization and can stay rather than likely move to a different organization. Employees will tend to be more motivated to figure. Through employee benefits, the goals of HRM are achieved in effective ways.
2) Genentech also Zappos, struggle to form a fun place to travel to figure at. Genentech and Zappos offer many benefits to employees that might attract and keep employees within the organization. The good thing about benefits it can provide meaning and value to employees which will increase the worker's enthusiasm and morale within the work environment. With this, employees will then become more motivated to extend performance and feel secure within the organization which may cause low turnover rates and highly satisfied employees.
3) From a knowledgeable view, I actually believe that the motivation benefits as presented by the Genentech and Zappos Corporations can't be employed by other major or maybe small corporations. The motivation benefits offered at Genentech and Zappos Corporations are unique to their companies. I think that if other Corporations attempt to mirror the efforts of both Genentech and Zappos that their businesses would simply cease to exist. Companies today just don’t have the sustainability to take care of these lofty incentive packages for a three-year, five years, or even ten-year plan. Most companies simply don’t have the financial capital that the efforts of the Genentech and Zappos Corporations.
Which type of communication technology is attractive to businesses
because it eliminates travel expenses by allowing simultaneous
communication globally?
O Groupware
Extranets
Intranets
Hotspots
Client-server networks
Suppose that the required reserve ratio is 0.20. If a customer makes a deposit of $10 million in a bank, then the money supply could potentially
Answer:
$50 million
Explanation:
Reserve Ratio : they are the percentage of deposits required by the central bank that banks keep
Increase in the total value of checkable deposit is determined by the money multiplier
Money multiplier = amount deposited / reserve requirement
10 / 0.2 = 50 million
Three broad categories of definitions of quality are: product quality, service quality, and organizational quality. user based, manufacturing based, and product based. internal, external, and prevention. low-cost, response, and differentiation. Pareto, Shewhart, and Deming.
Answer:
user based, manufacturing based, and product based.
Explanation:
Quality is the degree in which the commodity meets the customer requirement at the beginning of its life as per ISO 9000
The impact of the quality could experience from the customer. The perception with regard to the quality of the product comes by the design & specifications and the accomplishment of the manufactured standards. The perception related to the service quality would arrive from the design of the process and the standard of the delivery
So as per the given situation, the above should be the answer
The following is a condensed version of the comparative balance sheets for Bonita Corporation for the last two years at December 31.
2020 2019
Cash $ 300,900 $ 132,600
Accounts receivable 306,000 314,500
Investments 88,400 125,800
Equipment 506,600 408,000
Accumulated Depreciation-Equipment (180,200 ) (151,300 )
Current liabilities 227,800 256,700
Common stock 272,000 272,000
Retained earnings 521,900 300,900
Additional information:
Investments were sold at a loss of $17,000; no equipment was sold; cash dividends paid were $51,000; and net income was $272,000.
Prepare a statement of cash flows for 2020 for Shamrock Corporation. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)
Answer:
Bonita Corporation
Statement of Cash Flows for the year ended December 31, 2020:
Operating Activities:
Net income $272,000
add loss from sale of investment 17,000
add Depreciation expense 28,900
Changes in working capital:
Accounts receivable $8,500
Current liabilities -28,900
Net cash from operations $297,500
Investing Activities:
Sale of investments $20,400
Purchase of equipment -98,600
Net cash from investing -$78,200
Financing Activities:
Payment of dividends -$51,000
Net cash flows $168,300
Explanation:
a) Data and Calculations:
Comparative Balance Sheets
2020 2019 Changes
Cash $ 300,900 $ 132,600 +$168,300
Accounts receivable 306,000 314,500 -$8,500
Investments 88,400 125,800 -$37,400
Equipment 506,600 408,000 +$98,600
Accumulated Depreciation
-Equipment (180,200 ) (151,300 ) +(28,900)
Current liabilities 227,800 256,700 -$28,900
Common stock 272,000 272,000 0
Retained earnings 521,900 300,900
Additional Information
Loss from sale of investment = $17,000
Net income = $272,000
Dividends = $51,000
Cash Beginning Balance $132,600
Net cash flows $168,300
Cash, Ending balance $ 300,900
Richards Corporation had net income of $205,359 and paid dividends to common stockholders of $41,600. It had 53,900 shares of common stock outstanding during the entire year. Richards Corporation's common stock is selling for $63 per share. The price-earnings ratio is
Answer:
16.54
Explanation:
Calculation to determine what The price-earnings ratio is
First step is to calculate the Earnings per share using this formula
Earnings per share = Net income/No of ordinary shares outstanding
Let plug in the formula
Earnings per share = $205,359/53,900 share
Earnings per share = 3.81
Now let calculate the Price-earnings ratio using this formula
Price-earnings ratio = Market price per share/Earnings per share
Let plug in the formula
Price-earnings ratio = $63/3.81
Price-earnings ratio = 16.54
Therefore The price-earnings ratio is 16.54
Collins Corporation uses a predetermined overhead rate based on direct labor cost to apply manufacturing overhead to jobs. The following information applies to the Collins Corporation for the current year: Direct Labor-Hours: Estimated for the Year 24,000 Actual Hours Worked 19,500 Direct Labor Cost Estimated for the Year 300,000 Actual Cost Incurred 210,000 Manufacturing Overhead Estimated for the Year 240,000 Actual Cost Incurred 185,000 Beginning Balance Ending Balance Raw Materials 14,000 22,000 Work in Process 27,000 9,000 Finished Goods 62,000 77,000 The manufacturing overhead cost for the current year will be: a. $17,000 overallocated. b. $17,000 underallocated. c. $55,000 overallocated. d. $55,000 underallocated.
Answer:
b. $17,000 underallocated
Explanation:
Given the information above, the computation of manufacturing overhead cost for the current year is seen below;
First, we will compute the predetermined overhead cost
= Estimated manufacturing overhead / Estimated direct labor hour
Seldomridge, Inc., manufactures and sells two products: Product I5 and Product U0. Data concerning the expected production of each product and the expected total direct labor-hours (DLHs) required to produce that output appear below: Expected Production Direct Labor-Hours Per Unit Total Direct Labor-Hours Product I5 700 7.0 4,900 Product U0 200 10.0 2,000 Total direct labor-hours 6,900 The direct labor rate is $24.40 per DLH. The direct materials cost per unit for each product is given below: Direct Materials Cost per Unit Product I5 $116.10 Product U0 $212.10 The company is considering adopting an activity-based costing system with the following activity cost pools, activity measures, and expected activity: Estimated Expected Activity Activity Cost Pools Activity Measures Overhead Cost Product I5 Product U0 Total Labor-related DLHs $ 246,468 4,900 2,000 6,900 Product testing tests 10,494 500 400 900 Order size MHs 837,660 4,700 4,500 9,200 $ 1,094,622 The unit product cost of Product U0 under activity-based costing is closest to: (Round your intermediate calculations to 2 decimal places.)
Answer:
Seldomridge, Inc.
The unit product cost of Product UO under activity-based costing is closest to:
= $2,930.77
Explanation:
a) Data and Calculations:
Direct labor rate = $24.40
Product I5 Product U0 Total
Expected Production 700 200 900
Direct Labor-Hours Per Unit 7.0 10.0
Total Direct Labor-Hours 4,900 2,000 6,900
Total direct labor costs $119,560 $48,800 $168,360
Direct Materials Cost per Unit $116.10 $212.10
Total direct materials cost $81,200 $42,420 $123,620
Activity Estimated Activity Measures
Activity Cost Pools Measure Overhead Product I5 Product U0 Total
Labor-related DLHs $ 246,468 4,900 2,000 6,900
Product testing tests 10,494 500 400 900
Order size MHs 837,660 4,700 4,500 9,200
Total $ 1,094,622
Overhead Rates
Labor-related $35.72 ($246,468/6,900)
Product testing $11.66 ($10,494/900)
Order size $91.05 ($837,660/9,200)
Overhead applied to Product UO:
Labor-related = $71,440 ($35.72 * 2,000)
Product testing 4,664 ($11.66 * 400)
Order size 418,830 ($91.05 * 4,600)
Total overhead $494,934
Product UO
Direct labor costs $48,800
Direct materials costs 42,420
Overhead costs 494,934
Total product costs $586,154
Expected production units 200
Unit product cost = $2,930.77