Pricing is based on a cost-plus formula where costs are estimated then contracts are priced at 50% above cost. What would happen if Maya picked the “wrong” cost driver to set target costs and prices? What other implications may result from choosing the wrong cost driver?
In: Accounting
If a healthcare organization has a strategy of lowering its cost of care, what types of IT applications might it consider? If the organization has a strategy of improving the quality of its care, what types of IT applications might it consider? In your posts, please include:
How are the lists similar?
Can you reduce the cost of care and still provide quality of care?
In: Nursing
Lower-of-Cost-or-Market Inventory
On the basis of the following data, determine the value of the inventory at the lower of cost or market. Assemble the data in the form illustrated in Exhibit 10.
| Product |
Inventory |
Cost Per |
|
| Class 1: | |||
| Model A | 19 | $299 | $295 |
| Model B | 23 | 78 | 86 |
| Model C | 44 | 237 | 241 |
| Class 2: | |||
| Model D | 9 | 78 | 83 |
| Model E | 9 | 244 | 228 |
a. Determine the value of the inventory at the lower of cost or market applied to each item in the inventory.
| Inventory at the Lower of Cost or Market | ||||||
Product |
Inventory Quantity |
Cost per Unit |
Market Value per Unit (Net Realizable Value) |
Cost | Market | Lower of Cost or Market |
| Model A | $ | $ | $ | $ | $ | |
| Model B | ||||||
| Model C | ||||||
| Model D | ||||||
| Model E | ||||||
| Total | $ | $ | $ | |||
b. Determine the value of the inventory at the lower of cost or market applied to each class of inventory.
| Inventory at the Lower of Cost or Market |
||||||
Product |
Inventory Quantity |
Cost per Unit |
Market Value per Unit (Net Realizable Value) |
Cost | Market | Lower of Cost or Market |
| Class 1: | ||||||
| Model A | $ | $ | $ | $ | ||
| Model B | ||||||
| Model C | ||||||
| Subtotal | $ | $ | $ | |||
| Class 2: | ||||||
| Model D | $ | $ | ||||
| Model E | ||||||
| Subtotal | $ | $ | ||||
| Total | $ | $ | $ | |||
c. Determine the value of the inventory at the lower of cost or market applied to total inventory.
| Inventory at the Lower of Cost or Market | ||||||
Product |
Inventory Quantity |
Cost per Unit |
Market Value per Unit (Net Realizable Value) |
Cost | Market | Lower of Cost or Market |
| Model A | $ | $ | $ | $ | ||
| Model B | ||||||
| Model C | ||||||
| Model D | ||||||
| Model E | ||||||
| Total | $ | $ | $ | |||
Check My Work
In: Accounting
5. If the buyer of merchandise agrees to pay shipping costs, how
is the cost recorded?
6. If the seller of merchandise agrees to pay shipping costs, how
is the cost recorded?
7. Why would the seller of merchandise offer a discount for early
payment?
8. Payment terms are: 4/10, n/50. What does this mean?
9. If the buyer takes advantage of the discount offered, what will
happen to the cost of his/her merchandise?
10. When would the contra revenue account Sales Returns &
Allowances be used?
11. When would the contra revenue account Sales Discount be
used?
12. How will the two contra revenue accounts (in #10 and #11)
affect sales?
13. What kind of account is inventory?
14. How is the inventory account adjusted?
15. For each account below, indicate whether it is a permanent
account or temporary account:
a. Cost of Goods Sold
b. Sales Revenue
c. Sales Discount
d. Sales Returns & Allowances
e. Inventory
In: Accounting
Linh purchased a boat at a cost of $12 000. The boat has an estimated residual value of $2 000 and an estimated life of five years, or 100 000 hours of operation. The boat was purchased on 1 July 2017, and was used 27 000 hours in 2017/18 and 26 000 hours in 2018/19.
What method of depreciation will maximise depreciation expense in 2017/18?
Group of answer choices
Reducing Balance
Unit of Activity
Straight-line
All methods produce the same depreciation expense for the year 2017/2018
In: Accounting
A-Rod Manufacturing Company is trying to calculate its cost of
capital for use in making a capital budgeting decision. Mr. Jeter,
the vice-president of finance, has given you the following
information and has asked you to compute the weighted average cost
of capital.
The company currently has outstanding a bond with a 10.2 percent
coupon rate and another bond with an 7.8 percent rate. The firm has
been informed by its investment banker that bonds of equal risk and
credit rating are now selling to yield 11.1 percent. The common
stock has a price of $56 and an expected dividend (D1) of $1.76 per
share. The historical growth pattern (g) for dividends is as
follows:
$ 1.31
1.45
1.60
1.76
The preferred stock is selling at $76 per share and pays a dividend of $7.20 per share. The corporate tax rate is 30 percent. The flotation cost is 2.0 percent of the selling price for preferred stock. The optimum capital structure for the firm is 25 percent debt, 20 percent preferred stock, and 55 percent common equity in the form of retained earnings.
Growth Rate is 10% (10.343) - Correct Answer
b. Compute the cost of capital for the individual components in the capital structure. (Use the rounded whole percent computed in part a for g. Do not round any other intermediate calculations. Input your answers as a percent rounded to 2 decimal places.)
Cost of Debt = 7.77% - Correct Answer
Cost of preferred stock = 9.67 Correct Answer
Please resolve Cost of common stock = ????
WACC = Sum of (Weights x Costs)
= 7.77% x 25% + 9.67% x 20% + ???? x 55%
Please resolve the above two issues (????). Thank you and I appreciate your help.
In: Finance
Daily Enterprises is purchasing a $9.8 million machine. It will cost $51,000 to transport and install the machine. The machine has a depreciable life of five years and will have no salvage value. The machine will generate incremental revenues of $4.2 million per year along with incremental costs of $1.2 million per year. If Daily's marginal tax rate is 35%, what are the incremental earnings (net income) associated with the new machine? The annual incremental earnings are nothing.
SHOW THE WORK PLEASE!
In: Finance
2
a.) Draw the demand, marginal revenue and marginal cost curve for a monopolist. Show the equilibrium price and quantity supplied and total profit. Show the equilibrium price and quantity supplied and total profit.
b.) Suppose new policy suggest the government can imposed a tax on monopolists equal to 25 percent of their economic profits, how this affect the output level of the firm? How about the price? Explain.
In: Economics
Delta Company produces a single product. The cost of producing and selling a single unit of this product at the company’s normal activity level of 86,400 units per year is:
| Direct materials | $ | 2.10 |
| Direct labor | $ | 2.00 |
| Variable manufacturing overhead | $ | .60 |
| Fixed manufacturing overhead | $ | 4.15 |
| Variable selling and administrative expense | $ | 1.50 |
| Fixed selling and administrative expense | $ | 1.00 |
The normal selling price is $18 per unit. The company’s capacity
is 109,200 units per year. An order has been received from a
mail-order house for 1,900 units at a special price of $15.00 per
unit. This order would not affect regular sales.
Required:
1. If the order is accepted, by how much will annual profits be increased or decreased? (The order will not change the company’s total fixed costs.)
2. Assume the company has 500 units of this product left over from last year that are inferior to the current model. The units must be sold through regular channels at reduced prices. What unit cost is relevant for establishing a minimum selling price for these units? (Round your answer to 2 decimal places.)
In: Accounting
Consider the following hourly demand and cost schedule for a firm facing a fixed price of $ 6.00 per unit. (Tπ, is Total Profit).
Q P TR MR TFC TVC TC MC ATC AVC Tπ
0 $6.00 $2.00
1 4
2 6
3 8
4 11
5 15
6 20
8 33
9 41
10 50
11 60
In: Economics