Answer:
1. A Tax per mile driven would be more efficient than a tax per gallon of gasoline.
2. A tax per gallon of gasoline is more regressive. The tax is based on a fixed dollar per gallon since 1993. instead of being based on a percentage per the price of gasoline per gallon. With the current rate, the price of gasoline per gallon may even be less than the tax. One can then ask, "what is the purpose of the tax?" Is the tax a road tax or a per gallon use tax?
Explanation:
When the federal gas tax remains at 18.4 cents per gallon for a very long period, the tax can be described as regressive as it does not take into consideration the trend that Americans are driving fewer miles, and vehicles have become more fuel-efficient. This means that the gas tax is not fit for purpose. If its purpose is to generate revenue for road repairs, then instead of a gallon tax, government should institute a road use tax.
The Bob Buckham Senior Center, a not-for-profit entity, serves a hot meal to senior citizens every Friday evening. All the food is donated by a local supermarket. All the food preparation and serving is done by local volunteers. If the Center had to pay for the food, it would need to spend $10,000 a year. If it had to pay for the food preparation and service, it would need to spend $12,000 a year. How should it report these contributions in its financial statements?
Food | Food preparation and service
a. Disclose in the notes | Disclose in the notes
b. Disclose in the notes | Report $12,000 revenue and expense
c. Report $10,000 revenue and expense | Disclose in the notes
d. Report $10,000 revenue and expense | Report $12,000 revenue and expense
Answer:
c. Report $10,000 revenue and expense | Disclose in the notes
Explanation:
Not-for-profit entities must report the fair value of all the goods they receive as donations. in this case, they would have to report the $10,000 worth of food received from a local supermarket. But they are not required to report the value of volunteer work, they only have to disclose it on the footnotes of their financial statements.
The following information relating to a company's overhead costs is available.
Actual total variable overhead $74,000
Actual total fixed overhead $18,000
Budgeted variable overhead rate per machine hour $2.00
Budgeted total fixed overhead $16,000
Budgeted machine hours allowed for actual output 44,000
Based on this information, the total variable overhead variance is:
a. $2,000 favorable.
b. $6,000 favorable.
c. $2,000 unfavorable.
d. $6,000 unfavorable.
e. $1,000 favorable.
All else being equal, a marketing channel that has a high cost per exposure will have a ________ return on investment.
Answer:
all else being equal, a marketing channel that has a high cost per exposure will have a low return on investment
The Watts Company uses predetermined overhead rates to apply manufacturing overhead to jobs. The predetermined overhead rate is based on labor cost in Dept. A and on machine-hours in Dept. B. At the beginning of the year, the company made the following estimates:
Department A Department B
Direct labour cost $30,000 $40,000
Manufacturing overhead $60,000 $50,000
Direct labour hours 6,000 8,000
Machine hours 2,000 10,000
What predetermined overhead rates would be used in Departments A and B, respectively?
a. 50% and $8.00.
b. 50% and $5.00.
c. 110% and $15.00.
d. 200% and $5.00.
Answer:
The Watts Company
d. 200% and $5.00.
Explanation:
a) Data and Calculations:
Estimates:
Department A Department B
Direct labour cost $30,000 $40,000
Manufacturing overhead $60,000 LH $50,000 MH
Direct labour hours 6,000 8,000
Machine hours 2,000 10,000
Department A:
Manufacturing overhead rate = $60,000/$30,000 x 100 = 200%
Department B:
Manufacturing overhead rate = $50,000/10,000 = $5.00
The Watts Company Department A will absorb manufacturing overhead at a rate of 200% of direct labor cost in order to arrive at an estimate of $60,000 ($30,000 x 200%). The Department B will absorb manufacturing overhead at a rate of $5 per machine hour to arrive at an estimate of $50,000 (10,000 x $5).
Investing activities on the statement of cash flows generate cash inflows and outflows related to borrowing from and repaying principal to creditors and completing transactions with the company’s owners such as selling or repurchasing shares of common stocks and paying dividends.
A. True
B. False
Answer: False
Explanation:
The cash flow from investing activities is a cash flow section that shows cash generated or the cash that is spent which relates to activities involving investment and this include buying physical assets, the investments in securities, or sale of assets or securities.
Therefore, the above analysis I the question is wrong.
which of the following quotes is the best way to tell your boss that you can't accept a new assignment right now?
a. I would like to work on this. but if I take this on I won't be able to meet my current deadline.
b. you know I already have this other deadline
c. I just don't know if I can get this all done
d. I don't have time sorry
Answer:
a
Explanation:
it would be fine hopefully
The correct quotes are the best way to tell your boss that you can't accept a new assignment right now is "I would like to work on this. But if I take this on, I won't be able to meet my current deadline". Thus, option (a) is correct.
What is assignment?An assignment is a judicial word used in the context of contract and property law. Assignment is the process through which one person, the assignor, passes rights or advantages to another, the assignee.
Assignment is providing someone to a specific job or piece of labor, or assigning someone to a specific location to complete a job.
The simplest approach to inform your supervisor that you can't take on a new job right now is to say, "I'd want to work on this, but if I take it on, I won't be able to fulfill my present deadline." Therefore, it can be concluded that option (A) is correct.
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Year
2016
2017
2018
2019
Cow
P
$300
$350
$370
$380
Q
1000
1050
1100
1200
Bicycle
P
$120
$130
$140
$150
Q
1200
1300
1500
1600
1. Calculate nominal GDP for each year
2. Calculate real GDP for each year
3. Calculate GDP deflator and inflation rate
Consumer sentiment suddenly crashes below early-pandemic levels in the US #accelerationism
Oligopoly firms will seldom change prices but if one firm increases their price, others may follow if costs have ____________ .
Answer:
decreased
Explanation:
if firms have decreased then it would be likely to follow other firms to increase popularity
Oligopoly firms will seldom change prices but if one firm increases its price, others may follow if costs have Decreased.
What is Oligopoly?A market structure known as an oligopoly has a limited number of enterprises, none of which can prevent the others from having a large impact. The market share of the major companies is calculated using the concentration ratio.
A market with a monopoly has only one producer, a duopoly has two businesses, and an oligopoly has three or more businesses. The maximum number of firms in an oligopoly is unknown, but it must be low enough so that each firm's actions have a significant impact on the others.
In the past, oligopolies have existed in the steel industry, the oil industry, the railroad industry, the tire industry, grocery store chains, and the wireless industry. An oligopoly can prevent new competitors from entering the market, stifle innovation, and raise prices, all of which are detrimental to consumers.
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X-treme Vitamin Company is considering two investments, both of which cost $20,000. The cash flows are as follows: Year Project A Project B 1 $ 23,000 $ 20,000 2 10,000 9,000 3 10,000 15,000 Use Appendix B for an approximate answer but calculate your final answer using the formula and financial calculator methods. a-1. Calculate the payback period for Project A and Project B. (Round your answers to 2 decimal places.) a-2. Which of the two projects should be chosen based on the payback method
Answer:
Project A = 0.87 years
Project B = 1 year
2 Project should be chosen because it has a shorter payback period.
Explanation:
Payback calculates the amount of time it takes to recover the amount invested in a project from it cumulative cash flows.
For project A, the payback period is $20,000 / $23,000 = 0.87 years
For project B, the payback period is $20,000 / $20,000 = 1 year
Project should be chosen because it has a shorter payback period.
A company purchased 400 units at $75 per unit. The company sold 385 units. what is the cost of goods sold and ending inventory
Answer:
Cost of goods sold $28,875
Ending inventory $1,125
Explanation:
Calculation for cost of goods sold and ending inventory
Cost of goods sold is calculated using this formula
Cost of goods sold=Sales units *Purchased per units
Let plug in the formula
Cost of goods sold=385 units *$75 per unit
Cost of goods sold=$28,875
Calculation for the ending inventory using this formula
Ending inventory=(Purchased units * purchased per unit) -Cost of goods sold
Let plug in the formula
Ending inventory=(400 units× 75 per unit) -$28,875
Ending inventory=$30,000-$28,875
Ending inventory=$1,125
Therefore the Cost of goods sold will be $28,875 while the Ending inventory will be $1,125
Many managers describe performance appraisal as the responsibility that they like least. Why is this so? What could be done to improve the situation?
Answer:
Performance appraisal is by its very nature subjective. To improve the situation, as much as it is possible, objectivity should be allowed to rule all appraisal processes.
Explanation:
Performance appraisal is the formal evaluation of employees by their managers for the purpose of aligning employees' performance to the achievement of corporate objectives. To achieve goal congruence between employees who have different objectives for their work and the organization which wants to achieve profit and other corporate goals, performance appraisals are carried out periodically. However, the process has been marred by manager's bias, incompetence, and other problems.
When the Performance appraisal is by its very nature subjective. then to boost true, the maximum amount because it is feasible, objectivity should have been allowed to rule all appraisal processes.
How to describe Managers Performance?The Performance of appraisal is the formal evaluation of employees by their managers for the aim of aligning employees performance to the achievement of corporate objectives. to realize goal congruence between employees who have different objectives for their work and also the organization which wants to realize profit and also other corporate goals, performance appraisals are allotted periodically. However, the method has been marred by the manager's bias, incompetence, and other problems.
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A couple thinking about retirement decide to put aside $3,000 each year in a savings plan that earns 8% interest. In 5 years they will receive a gift of $10,000 that also can be invested. a. How much money will they have accumulated 30 years from now
Answer:
Total future value= $408,334.38
Explanation:
Giving the following information:
A couple thinking about retirement decide to put aside $3,000 each year in a savings plan that earns 8% interest. In 5 years they will receive a gift of $10,000 that also can be invested.
First, we will determine the future value of the annual deposit investment. We need to use the following formula:
FV= {A*[(1+i)^n-1]}/i
A= annual deposit
FV= {3,000*[(1.08^30) - 1]} / 0.08
FV= $339,849.63
Now, for the $10,000:
FV= PV*(1+i)^n
FV= 10,000*(1.08^25)
FV= $68,484.75
Total future value= 339,849.63 + 68,484.75
Total future value= $408,334.38
Your client is 40 years old; and she wants to begin saving for retirement, with the first payment to come one year from now. She can save $5,000 per year; and you advise her to invest it in the stock market, which you expect to provide an average return of 9% in the future.
Answer:
14,000
Explanation:
im smart
Suppose you purchase a $5,000 bond that pays 7% interest annually and matures in five years. If the inflation rate during the next five years is 4%, the estimated real rate of return is
Answer:
2.88%
Explanation:
Use the following formula to calculate the real rate of return
Real rate of return = [tex]\frac{( 1 + Nominal interest rate )}{( 1 + inflation rate)} -1[/tex]
Where
Nominal Interest rate = 7% = 0.07
Inflation rate = 4% = 0.04
Placing values in the formula
Real rate of return = [tex]\frac{( 1 + 0.07 )}{( 1 + 0.04)} -1[/tex]
Real rate of return = [tex]\frac{1.07}{1.04} -1[/tex]
Real rate of return = 1.0288 - 1
Real rate of return = 0.0288
Real rate of return = 2.88%
Delta Lighting has 30,000 shares of common stock outstanding at a market price of $15 a share. This stock was originally issued at $31 per share. The firm also has a bond issue outstanding with a total face value of $280,000 which is currently selling for 82 percent of par. The cost of equity is 14 percent while the after-tax cost of debt is 6.8 percent. The firm has a beta of 1.48 and a tax rate of 30 percent. What is the weighted average cost of capital?
Answer:
the weighted average cost of capital is 11.57 % .
Explanation:
Market Value of Equity = Number of Common Shares Outstanding × Market Price per share
= 30,000 shares × $15
= $450,000
Market Value of Debt = Face Value × 82%
= $280,000 × 82%
= $229,600
WACC = Ke × (E/V) + Kd × (E/V)
= 14.00 % × ($450,000/ $679,600) + 6.80 % × ($229,600/ $679,600)
= 9.27 % + 2.30 %
= 11.57 %
Schwab’s customers can assemble their own investment portfolios with its mutual fund evaluator tool, an example of
Answer:
A choiceboard.
Explanation:
This is generally described to be a graphical view or a teaching pattern where a tutor allows the said students to use these graphical knowledge to learn and understand a concept been impacted to them at their own pace. This choiceboard is been set up for so many reasons which may include; the encouraging of communication by giving the children means to request a particular object, also giving children certain visual prompt to say the correct words, it is also seen to streamline the selection of choice down there which could be a selection of choices.
If Ben invests $3500 at 4% interest per year, how much additional money must he invest at 5 1 2 % annual interest to ensure that the interest he receives each year is 4 1 2 %
Answer:
Additional $1,750 must be invested by Ben.
Explanation:
Note: The question is not complete as some dots are omitted. The question is therefore given correctly before answering it as follows:
If Ben invests $3500 at 4% interest per year, how much additional money must he invest at 5 1/2 % annual interest to ensure that the interest he receives each year is 4 1/2 %.
The question is now answered as follows:
From the question, we have:
Initial amount invested = $3,500
Interest rate on initial amount invested = 4%, or 0.04
Interest amount from initial amount invested = Initial amount invested * Interest rate on initial amount invested = $3,500 * 4% = $140
Let y represents the additional amount to invest. Therefore, we have:
Interest rate of additional amount invested = 5 1/2% = 5.5% = 0.055
Interest amount from additional amount invested = y * Interest rate of additional amount invested = y * 0.055 = y0.055
Total interest amount = Interest amount from initial amount invested + Interest amount from additional amount invested = $140 + y0.055
New amount invested = Initial amount invested + y = $3,500 + y
Interest rate of new amount invested = 4 1/2% = 4.5% = 0.045
Interest amount from new amount invested = New amount invested * ($3,500 + y) * 0.045 = $157.50 + y0.045
Since total interest amount must equal interest amount from new amount invested, we equate the two and solve as follows:
Total interest amount = Interest amount from new amount invested
$140 + y0.055 = $157.50 + y0.045
We can now solve for y as follows:
y0.055 - y0.045 = $157.50 - $140
y0.01 = $17.50
y = 17.50 / 0.01
y = $1,750
Therefore, additional $1,750 must be invested by Ben.
Slack Inc. borrowed $400,000 on April 1. The note requires interest at 12% and principal to be paid in one year. How much interest is recognized for the period from April 1 to December 31? a. $0. b. $48,000. c. $32,000. d. $36,000
Answer:
D.$36,000
Explanation:
Calculation for How much interest is recognized for the period from April 1 to December 31
First step is to find the 12% of the amount that was borrowed which is $400,000
$400,000×12%
=$48,000
Now let calculate for the amount of interest that is recognized from April 1 to December 31
Interest =$48,000×3/12
Interest =$12,000
Hence,
Interest =$48,000-$12,000
Interest=$36,000
Therefore the amount of interest that is recognized from April 1 to December 31 will be $36,000
A company makes cat food. Management is considering whether the hard cardboard box for packing a case of canned cat food should be made internally or purchased from another company. The costs of producing the cardboard boxes include:_________.
Variable cost per box $0.39
Total fixed costs of the factory $59,030 per year
Total boxes needed annually 21,962
Quote from the supplier, per box $0.22
How much will the company save (or lose) IN TOTAL if they accept the supplier's quote? If they lose money, put a negative sign in front of your answer. If they save money, just put in the number without any sign in front of it.
Answer:
Total relevant cost of 21,962 * $0.39 = $8,565.18
making internally
Less: Total relevant 21,962 * 0.22 = $4,831.64
cost of purchasing
Savings in cost $3,733.54
Conclusion: Manufacturing the hard cardboard box internally will save cost of $3,733.54 as compared to cost of purchasing the same quantity of box needed from supplier.
Note: Fixed costs is not relevant cost as it is unavoidable.
National Bank has several departments that occupy both floors of a two-story building. The departmental accounting system has a single account, Building Occupancy Cost, in its ledger. The types and amounts of occupancy costs recorded in this account for the current period follow.
Depreciation—Building $31,500
Interest—Building mortgage 47,250
Taxes—Building and land 14,000
Gas (heating) expense 4,375
Lighting expense 5,250
Maintenance expense 9,625
Total occupancy cost $112,000
The building has 7,000 square feet on each floor. In prior periods, the accounting manager merely divided the $112,000 occupancy cost by 14,000 square feet to find an average cost of $8 per square foot and then charged each department a building occupancy cost equal to this rate times the number of square feet that it occupied. Diane Linder manages a first-floor department that occupies 900 square feet, and Juan Chiro manages a second-floor department that occupies 1,800 square feet of floor space. In discussing the departmental reports, the second-floor manager questions whether using the same rate per square foot for all departments makes sense because the first-floor space is more valuable. This manager also references a recent real estate study of average local rental costs for similar space that shows first-floor space worth $40 per square foot and second-floor space worth $10 per square foot (excluding costs for heating, lighting, and maintenance).
Required
a. Allocate all occupancy costs to the Linder and Chiro departments using the current allocation method.
b. Allocate the depreciation, interest, and taxes occupancy costs to the Linder and Chiro departments in proportion to the relative market values of the floor space. Allocate the heating, lighting, and maintenance costs to the Linder and Chiro departments in proportion to the square feet occupied (ignoring floor space market values). Analysis Component
c. Which allocation method would you prefer if you were a manager of a second-floor department? Explain.
Answer:
National Bank
a. Allocation of Occupancy costs to Linder and Chiro Departments, using the current allocation method:
Linder's Department Chiro's Department
First-floor square feet 900 1,800
Average occupancy cost $8 $8
Total Occupancy costs $7,200 $14,400
b. Allocation of Occupancy costs to Linder and Chiro Departments, using the relative market values of the floor space:
Linder's Department Chiro's Department
First-floor square feet 900 1,800
Relative market value per square foot $40 $10
Total Occupancy costs:
Depreciation, interest & taxes $36,000 $18,000
Heating, lighting, & maintenance
(Rate = $1.375) $1,237.50 $2,475
Total occupancy costs $37,237.50 $20,475
c. As a manager of a second-floor department I would prefer the second method, where only the heating, lighting, and maintenance costs are based on the average cost and the rest of the occupancy costs are based on the relative market values of the floor space. The reason is that it looks more justified given that the two floors do not have the same market value. Assuming that the two floors command the same market value, then the first method is okay.
Explanation:
a) Data and Calculations:
Depreciation—Building $31,500
Interest—Building mortgage 47,250
Taxes—Building and land 14,000 $92,750
Gas (heating) expense 4,375
Lighting expense 5,250
Maintenance expense 9,625 $19,250
Total occupancy cost $112,000
Total square feet = 14,000
Average occupancy cost based on square feet = $8 ($112,000/14,000)
Building = 7,000 square feet on each floor
Diane Linder's first-floor department = 900 square feet
Juan Chiro's second-floor department = 1,800 square feet
Market rental costs (excluding costs for heating, lighting, and maintenance):
First-floor space = $40 per square foot
Second-floor space = $10 per square foot
The Sherman Antitrust Act: Multiple Choice was passed in 1800. All of these statements are true. was actively used by President Roosevelt in the early 20th century. no longer applies to business practices today.
Answer: Was actively used by President Roosevelt in the early 20th century.
Explanation:
The Sherman Act of 1890 was a law passed by Congress to target monopolies in the United States. At the time, Trusts had been in existence. Trusts were in effect monopolies because they worked by getting the largest stockholders to transfer their stock to a single trust and get profits from all companies in the trust. This Trust would then in effect control the industry as a monopoly.
To combat this, the Sherman Act enabled the Federal Government to go against Trusts and dissolve them. This was good news to President Theodore Roosevelt who ruled from 1901 to 1909. Roosevelt hated the anti-competitive tactics of the rich that ripped off the poor. He believed that this would bring about a revolution and he also hated them as the big corporations thought themselves above the law in his assessment.
Using the Sherman Act, he went against them with so much vigor that he earned the nickname, The Trust Buster. He started with a Trust controlled by J.P. Morgan called Northern Securities Company which was dissolved by the Supreme Court after the Attorney General under Roosevelt brought a suit against them.
The two-step flow supports the notion that consumption styles are primarily influenced by a "trickle-down" or "trickle-up" effect from mass media. Group of answer choices
Answer: False
Explanation:
The two-step communication is used in situations to explain that messages should be directed by the mass communicators to opinion leaders. Once this is done, the opinion leaders will then deliver such messages to other people.
The the notion that consumption styles are primarily influenced by a "trickle-down" or "trickle-up" effect from mass media is wrong.
answered - expert verified
changing role of women in the past 25 year
relating to joint families . nuclear families
women as a bread earner of the family.
changes in the requirement trend of mixers.
washing machines , micro wave and standard
of living
SEE ANSWERS
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Answer:
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An increase in taxes when the economy is above full employment ______ aggregate demand and real GDP, and the price level ______.
Question options :
A. increases; falls
B. decreases; falls
C. does not change; does not change
D. increases; rises
Answer:
B. decreases; falls
Explanation:
let us understand this by looking at the logic behind it. First when the economy is at full employment, there is high demand since there will be increase in money supply through increased circulation from salaries and wages. If government increases taxes, this will reduce purchasing power as money supply will be reduced and therefore demand will be reduced. Also price will fall since according to the Law of demand and supply, if demand is more than supply, price will increase
Disturbed Corp. needs to raise $57 million to fund a new project. The company will sell shares at a price of $23.70 in a general cash offer and the company's underwriters will charge a spread of 7.5 percent. The direct flotation costs associated with the issue are $725,000 and the indirect costs are $445,000. How many shares need to be sold?
Answer: 2653438 shares
Explanation:
From the information given in the question, the following can be deduced:
The share price will be:
= $23.70 × (1 - 7.5%)
= $23.70 × (1 - 0.075)
= $23.70 × 0.925
= $21.9225
The money that will be raised will be:
= 57,000,000 + 725,000 + 445,000
= $58,170,000
The number of shares that are needed to be sold will be:
= $58,170,000/$21.9225
= 2653438 shares
You expect General Motors (GM) to have a beta of 1.3 over the next year and the beta of Exxon Mobil (XOM) to be 0.9 over the next year. Also, you expect the volatility of General Motors to be 40% and that of Exxon Mobil to be 30% over the next year. Which stock has more systematic risk? Which stock has more total risk?
Answer:
As the beta of GM (1.3) is more than that of XOM (0.9), GM has more systematic risk than XOM.
The volatility of GM (40%) is higher than that of XOM (30%). Thus, GM has a higher total risk than XOM.
Explanation:
The systematic risk is the risk caused by factors that affect all of the market and are unavoidable. Such a risk is also known as a market risk and is measured by the beta of a stock. The market beta is always 1. A stock having a beta higher than 1 has higher systematic risk than market and a stock having a lower beta than 1 has a lower systematic risk than the market.
As the beta of GM (1.3) is more than that of XOM (0.9), GM has more systematic risk than XOM.
Total risk, on the other hand, is the risk that comprises of both systematic and unsystematic risk. The systematic risk is the market risk as mentioned above while the unsystematic risk is the firm specific risk and is avoidable. The total risk is measured by the standard deviation or volatility of the stock. The stock with higher volatility has higher total risk and vice versa.
The volatility of GM (40%) is higher than that of XOM (30%). Thus, GM has a higher total risk than XOM.
Two years ago, the private equity firm you are the general partner of purchased a portfolio of regional shopping center in Texas. The shopping centers have performed well but not as well as you would like. So you have to decided to convert them to super-regional centers in an effort to boost their profits. Which of the following marketing-related step will you need to take in order to affect this transformation?
A. You will need to expand the width and length of your product mixes.
B. You will need to reduce your target market, and focus on a smaller geographical area.
C. You will need to reduce the number of stores in the shopping center.
D. You will need to upgrade the architectural designs of the stores.
Answer:
Correct Answer:
C. You will need to reduce the number of stores in the shopping center.
Explanation:
In the private firm, there are series of portfolio business which is being managed with the regional shopping center being one of them. In a situation the regional shopping center needs to be upgraded to super-regional center, then, there will be need to reduce the number of stores in the shopping center.
Suppose that a museum of modern art discovers the following: adults are willing to pay $20 per ticket to see a Monet exhibit. Students are willing to pay less; 60% of students have WTP of $15, and 40% are willing to pay up to $10. There are no marginal costs to allowing more viewers into the museum. The museum manager decides to set the regular price at $20, and offer a student discount. What discount should it offer?
Answer:
50%
Explanation:
From the question we have here
If adults would pay 20$
Out of a 100% students:
60% would pay 15
40% would pay 10
If regular price = 20$
We are required to find discount
Discount = (20 - 10)/20 x 100
Discount = 0.5 x 100
Discount = 50%
The museum should offer 50percent discount.
The EOQ model assumes inventory: Multiple Choice can be delivered immediately upon order. is sold at a steady rate until it is depleted. will be available just as it is needed for production. is held at a constant level. has seasonal fluctuations.
Answer:
is sold at a steady rate until it is depleted
Explanation:
The EOQ means Economic order quantity that refers to a quantity which the company should purchase for its inventory
In this order quantity, the carrying cost and the ordering cost are equivalent to each other
Also we assume that the demand would remain the same and the inventory should be depleted at a fixed rate unless it reaches to a zero
Hence, the second option is correct
Data pertaining to a company's joint production for the current period follows
L M
Quantities produced 310 lbs 260 lbs
Market value at split-off point . $10.2Mb $20.4/lb
Compute the cost to be allocated to Product L for this period's $792 of joint costs if the value basis is used. (Do not round intermediate calculations.)
a. $295.81.
b. $49619.
c. $39600.
d. $2,926.00.
e. $962.19.
Answer:
a. $295.81
Explanation:
Total market value = (310 * 10.2) + (260 * 20.4)
Total market value = 3,162 + 5,304
Total market value = 8466
Joint cost allocated to L on basis of value
= [ (310 * 10.2) / 8,466] * 792
= (3,162 / 8,466) * 792
= $295.81