Differentiate between near and far transfer. Provide a substantive example of each.

What type of structure exists in central Tennessee near Nashville? Geology

How JOBS act affect private equity investment in the near future?

Lavage Rapide is a Canadian company that owns and operates a large automatic car wash facility near Montreal. The following table provides data concerning the company’s costs:

For example, electricity costs are $1,100 per month plus $0.10 per car washed. The company expects to wash 8,100 cars in August and to collect an average of $5.90 per car washed. The company actually washed 8,200 cars in August.

Required:

Calculate the company's activity variances for August.

Lavage Rapide is a Canadian company that owns and operates a large automatic car wash facility near Montreal. The following table provides data concerning the company’s costs:

For example, electricity costs are $1,400 per month plus $0.05 per car washed. The company expects to wash 8,200 cars in August and to collect an average of $6.90 per car washed. The company actually washed 8,300 cars in August.

Calculate the company's activity variances for August.

Acme Development Company is considering building a twenty-five (25) unit apartment building near Catholic University due to the demand for off-campus student housing. Given the unique needs of the student population, Acme anticipates they will achieve 75% occupancy over the course of a year. Acme is basing their decision on the following assumptions:

 MARR:15%
 Land Acquisition:$150,000
 Construction Cost:$2,250,000
 Investment Period:20-years

Maintenance Expenses:Years 1 to 10: $500 per unit, Years 11 to 20: $1,000 per unit

 Property Taxes/Insurance:10% of total invested cost
Determine the break-even rent that should be charged per month for each apartment.

Problem 6-20 CVP Applications: Break-Even Analysis; Cost Structure; Target Sales [LO6-1, LO6-3, LO6-4, LO6-5, LO6-6, LO6-8]

Northwood Company manufactures basketballs. The company has a ball that sells for $25. At present, the ball is manufactured in a small plant that relies heavily on direct labor workers. Thus, variable expenses are high, totaling $15.00 per ball, of which 60% is direct labor cost.

Last year, the company sold 36,000 of these balls, with the following results:

Required:

1. Compute (a) last year's CM ratio and the break-even point in balls, and (b) the degree of operating leverage at last year’s sales level.

2. Due to an increase in labor rates, the company estimates that next year's variable expenses will increase by $3.00 per ball. If this change takes place and the selling price per ball remains constant at $25.00, what will be next year's CM ratio and the break-even point in balls?

3. Refer to the data in (2) above. If the expected change in variable expenses takes place, how many balls will have to be sold next year to earn the same net operating income, $97,000, as last year?

4. Refer again to the data in (2) above. The president feels that the company must raise the selling price of its basketballs. If Northwood Company wants to maintain the same CM ratio as last year (as computed in requirement 1a), what selling price per ball must it charge next year to cover the increased labor costs?

5. Refer to the original data. The company is discussing the construction of a new, automated manufacturing plant. The new plant would slash variable expenses per ball by 40.00%, but it would cause fixed expenses per year to double. If the new plant is built, what would be the company’s new CM ratio and new break-even point in balls?

6. Refer to the data in (5) above.

a. If the new plant is built, how many balls will have to be sold next year to earn the same net operating income, $97,000, as last year?

b. Assume the new plant is built and that next year the company manufactures and sells 36,000 balls (the same number as sold last year). Prepare a contribution format income statement and compute the degree of operating leverage.

ANSWER 5-6B

5. Refer to the original data. The company is discussing the construction of a new, automated manufacturing plant. The new plant would slash variable expenses per ball by 40.00%, but it would cause fixed expenses per year to double. If the new plant is built, what would be the company’s new CM ratio and new break-even point in balls? (Round "CM Ratio" to 2 decimal places and "Unit sales to break even" to the nearest whole unit.)

6.

If the new plant is built, how many balls will have to be sold next year to earn the same net operating income, $97,000, as last year? (Round your answer to the nearest whole unit.)

The PC Works assembles custom computers from components supplied by various manufacturers. The company is very small and its assembly shop and retail sales store are housed in a single facility in a Redmond, Washington, industrial park. Listed below are some of the costs that are incurred at the company.

Required:

For each cost, indicate whether it would most likely be classified as direct materials, direct labor, manufacturing overhead, selling, or an administrative cost.

1. The cost of a hard drive installed in a computer.

• Direct labor cost

• Direct materials cost

• Manufacturing overhead cost

• Selling cost

• Administrative cost

2. The cost of advertising in the Puget Sound Computer User newspaper.

• Direct labor cost

• Direct materials cost

• Manufacturing overhead cost

• Selling cost

• Administrative cost

3. The wages of employees who assemble computers from components.

• Direct labor cost

• Direct materials cost

• Manufacturing overhead cost

• Selling cost

• Administrative cost

4. Sales commissions paid to the company’s salespeople.

• Direct labor cost

• Direct materials cost

• Manufacturing overhead cost

• Selling cost

• Administrative cost

5. The salary of the assembly shop’s supervisor.

• Direct labor cost

• Direct materials cost

• Manufacturing overhead cost

• Selling cost

• Administrative cost

6. The salary of the company’s accountant.

• Direct labor cost

• Direct materials cost

• Manufacturing overhead cost

• Selling cost

• Administrative cost

7. Depreciation on equipment used to test assembled computers before release to customers.

• Direct labor cost

• Direct materials cost

• Manufacturing overhead cost

• Selling cost

• Administrative cost

Many families in California are using backyard structures for home offices, art studios, and hobby areas as well as for additional storage. Suppose that the mean price for a customized wooden, shingled backyard structure is . Assume that the standard deviation is .

a. What is the -score for a backyard structure costing (to 2 decimals)? If your answer is negative, enter minus (-) sign. b.

What is the -score for a backyard structure costing (to 2 decimals)?

c. Interpret the -scores in parts (a) and (b).

Comment on whether either should be considered an outlier. is standard deviations the mean. is standard deviations the mean.

d. If the cost for a backyard shed-office combination built in Albany, California, is , should this structure be considered an outlier? Explain. is (to 2 decimals) standard deviations the mean. This cost an outlier.