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Calculate two overhead rates. The first uses machine minutes as the allocation base, and the second overhead rate uses direct labor cost as the allocation base. Round both overhead rates to two deci
Which depreciation method does Amazon.com use for reporting in the financial statements? What type of depreciation method does the company probably use for income tax purposes? Why is this method p
General Electric Capital, a division of General Electric, uses long-term debt extensively. In early 2002, GE Capital issued $11 billion in long-term debt to investors, then within days filed legal d
Compute its contribution margin and contribution margin ratio. 3. Interpret the contribution margin ratio from part 2.
The overhead allocation rate in Franz Company's job order cost accounting system applies overhead based on direct labor costs. The manufacturing costs for the current year were.
Kitchen Rite is considering outsourcing the production of a steel chassis that is used in a kitchen appliance. Two thousand chassis are produced per month.
Both the reported value of longt-term and periodic interest charges should be based on unamortized issue price (plus or minus unamortized premium discount) and initial yield.
On June 1, 2009, National Equipment Rental leased equipment to the Glendale Community Club and Craig Legal Services. Glendale signed a lease indicating the club would rent portable tables for the mo
Assume that you are acquiring a $10 million computer system that has an economic life of approximately 3 years, a physical life of 6 years, and a technological life of 2 years.
Compute the net present value for this machine using a discount rate of 75% and assuming that cash flows occur at each year-end (hint: salvage value is a cash inflow at the end if the assets life. R
Assume all of the same facts as in Part a., except that Roberta is self-employed. Identify which of the expenses are deductible, and indicate whether they are deductions for or from AGI.
Compare the traditional gross profit (gross margin) concept in financial reporting to contribution margin in Cost-Volume-Profit analysi
Agarwal Technologies was founded 10 years ago. It has been profitable for the last 5 years, but it has needed all of its earnings to support growth and thus has never paid a dividend.
During the current year, Stan sells a tract of land for $800,000. The property was received as a gift from Maxine on March 10, 1995, when the property had a $310,000 FMV.
Develop a new product cost, using an activity-based costing approach, for one pound of Jamaican coffee and one pound of Colombian coffee.
Tracy owns a nondepreciable capital asset held for investment. The asset was purchased for $250,000 six years earlier and is now subject to a $75,000 liability.
Bourne Crafts manufactures specialty key chains for tourist attractions. On Dec 31, 2009, the firm had 200 souvenir attraction disks used in the production of the chains that cost $3 each.
Lovitz Company is planning to produce 2,500 units of product in 2008. Each unit requires 4 pounds of materials at $8 per pound and a half hour of labor at $17 per hour. The overhead rate is 70% of d
The financial statements of Lioi Steel Fabricators are shown below-both the actual results for 2010 and the projections for 2011. Free cash flow is expected to grow at a 6% rate after 2011. The weig
An article recently appeared in the wall street journal indicating that companies are sell receivables at a record rate. Discuss the reasons why a company may want to sell its receivables and the a
Georgia company borrowed 600,000 from a bank on may 1, 2007. the bank required a return of 12% on the loan. The loan is to be repaid over 12 months in equal installments. georgia companys fiscal yea
Plastics Inc. is a company that operates in four different divisions. The following information relating to each segment is available for 2013.
Simple plant manufactures DNA test strips. Manufacturing overhead is applied to unit produced using direct labor dollars at the allocation base. The overhead rate is calculated prior to the beginnin
Why is one product line preferred over the other, even though they both have the same total net cash flows through eight periods?
I-Mobile Inc. is considering an investment in new equipment that will be used to manufacture a mobile communications device. The device is expected to generate additional annual sales of 2,100 units