Bluecap Co. uses a standard cost system and flexible budgets for control purposes. The following budgeted information pertains to 2019: Denominator volume—number of units 8,000 Denominator volume—percent of capacity 80%Denominator volume—standard direct labor hours (DLHs) 24,000 Budgeted variable factory overhead cost at denominator volume$103,200 Total standard factory overhead rate per DLH$15.10 During 2019, Bluecap worked 28,000 DLHs and manufactured 9,600 units. The actual factory overhead cost for the year was $14,000 greater than the flexible budget amount for the units produced, of which $6,000 was due to fixed factory overhead. In preparing a budget for 2020 Bluecap decided to raise the level of operation to 90% of capacity (a level it considers to be "practical capacity"), to manufacture 9,000 units at a budgeted total of 27,000 DLHs.The total overhead variance in 2019 for Bluecap Co., to the nearest whole dollar, was:

Multiple Choice$17,280 favorable.$37,840 favorable.$15,040 favorable.$37,840 unfavorable.$14,000 unfavorable.

Giro Inc. manufactures and sells bicycle safety helmets. Price and cost data for the product follows:

Required:

1. Calculate Giro’s margin of safety in sales dollars.
2. How many units does the company have to sell in order to generate a net income figure of $600,000? The company has a 35% tax rate.
3. Giro is looking at the possibility of renting a machine at an annual cost of $90,000. This machine would allow Giro to reduce its direct labor costs by 15% and its variable manufacturing overhead costs by 5%. Advise Giro as to what the company should do.

1. Agan Interior Design provides home and office decorating assistance to its customers. In normal operation, an average of 2.1 customers arrive each hour. One design consultant is available to answer customer questions and make product recommendations. Agan's management would like to evaluate two alternatives:

   • Use one consultant with an average service time of 8 minutes per customer.
   • Expand to two consultants, each of whom has an average service time of 10 minutes per customer.

   If the consultants are paid $16 per hour and the customer waiting time is valued at $23 per hour for waiting time prior to service, should Agan expand to the two-consultant system?

   No

   What is the total cost for each scenario? Round your answers to the nearest cent.

   The total cost for the first scenario where there is one consultant with an average service time of 8 minutes per customer is $________ . The total cost for the second scenario where there are two consultants with an average service time of 10 minutes per customer is $________ .

Sanderlin Corporation has two manufacturing departments--Machining and Finishing. The company used the following data at the beginning of the year to calculate predetermined overhead rates:

During the most recent month, the company started and completed two jobs--Job C and Job L. There were no beginning inventories. Data concerning those two jobs follow:

Assume that the company uses departmental predetermined overhead rates with machine-hours as the allocation base in both production departments. The manufacturing overhead applied to Job L is closest to: (Round your intermediate calculations to 2 decimal places.)

We project unit sales for a new household-use laser-guided cockroach search and destroy system as follows:

The new system will be priced to sell at $400 each.

The cockroach eradicator project will require $1,600,000 in net working capital to start, and total net working capital will rise to 15% of the change in sales. The variable cost per unit is $275, and total fixed costs are $1,100,000 per year. The equipment necessary to begin production will cost a total of $15 million. This equipment is mostly industrial machinery and thus qualifies for CCA at a rate of 20%. In five years, this equipment will actually be worth about 20% of its cost.

The relevant tax rate is 35%, and the required return is 15%. Based on these preliminary estimates, what is the NPV of the project? (Enter the answer in dollars. Do not round your intermediate calculations. Round the final answer to 2 decimal places. Omit $ sign in your response.)

NPV           $

Lima Corp. offers a variety of share-based compensation plans to employees. Under its restricted stock unit plan, the company on January 1, 2021, granted restricted stock units (RSUs) representing 7 million of its $1 par common shares to various division managers. The shares are subject to forfeiture if employment is terminated within three years. The common shares have a market price of $27.00 per share on the grant date. Management’s policy is to estimate forfeitures.
  
Required:

1. Determine the total compensation cost pertaining to the RSUs.

Total compensation cost:

2. Prepare the appropriate journal entry to record the RSUs on January 1, 2021.

Record the award of restricted shares on January 1, 2021:

3. Prepare the appropriate journal entry to record compensation expense on December 31, 2021.

Record compensation expense on December 31, 2021:

4. Suppose Lima Corp. expected a 10% forfeiture rate on the RSUs prior to vesting. Determine the total compensation cost:

1. A.)What price will be charged by this firm (in the short-run) B.)What quantity will be sold by this firm in the short-run? C.) What profit will be earned by this firm (in the short-run) at that price and output?
2. Given #1 above, what happens in the long-run? Will the final price be higher or lower than what you found above? Assume that the costs remain the same and remember that this is a monopolistically competitive industry.
3. Given #2 above, what would happen if costs increase? In other words, if we’re at long-run equilibrium, and the minimum wage rises to $20/hr, what will happen to the price in the long-run? (increase/decrease/uncertain)

4. Q	Price	Total Cost	Marginal Cost	Total Revenue	Marginal Revenue	Avg Total Cost
   0	12	0	---------------------		-----------------
   1	11	5
   2	10	8
   3	9	11
   4	8	16
   5	7	25
   6	6	36
   7	5	49
   8	4	64
   9	3	81
   10	2	100

The Paver Corporation produces an executive jet for which it currently manufactures a fuel valve; the cost of the valve is indicated below:

The company has an offer from Duvall Valves to produce the part for $1,996 per unit and supply 910 valves (the number needed in the coming year). If the company accepts this offer and shuts down production of valves, production workers and supervisors will be reassigned to other areas where, unfortunately, they really are not needed. The equipment cannot be used elsewhere in the company, and it has no market value. However, the space occupied by the production of the valve can be used by another production group that is currently leasing space for $56,050 per year.

Should the company make or buy the valve?

Odessa, Inc., manufactures one model of computer desk. The following data are available regarding units shipped and total shipping costs:

Required:
1. Prepare a scattergraph of Odessa’s shipping cost and draw the line you believe best fits the data.



3. Using the high-low method, calculate Odessa’s total fixed shipping costs and variable shipping cost per unit.



4. Perform a least-squares regression analysis on Odessa’s data. (Use Microsoft Excel or a statistical package to find the coefficients using least-squares regression. Round your answers to 2 decimal places.)



5. Using the regression output, create a linear equation (y = a + bx ) for estimating Odessa’s shipping costs.

US Auto Company would like to offer rebates to its customers in order to increase sales. If it lowers prices sales will increase.    This will depend on the price elasticity of demand. Assume that the price elasticity of demand is 1.5. This firm is considering a $400 rebate on its cars. Also assume the following information on prices and costs before the rebates:

          Average price per car                                   $9,000 per car

          Expected sales volume at $9,000) per car     1,000,000 cars

          Average total costs per car                           $8,200 per car

          Total variable cost                                         $6,400,000,000

• Calculate the present total fixed costs, average variable costs and average fixed costs.
• What is the present breakeven point?
• What is the change in revenue resulting from the $400 price reduction?
• What is the effect on the cost per car after the change? In other words what is the average cost per car after the change?
• Should the change be made?

Please show the calculation. Thank you.