Needs of global business environment beyond the framework
Problem: Has the global business environment created needs that can no longer be addressed by the existing concept framework?
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The items of allocated costs and expenses represent general cots and expenses of the company that were allocated to the divisions.
Need to understand how to do the calculations. a) Compute the direct cost rate for each cost pool b) Compute the indirect cost rate for Overhead costs
1. Determine the absorption costing net operating income for LAST year. 2. Determine the absorption costing net operating income for THIS year.
Assume Gorvin Industries has no alternative use for the facilities presently devoted to production of the BINC gaskets. If the outside supplier offers to sell the gaskets for $0.46 each, should Gorvin Industries accept the offer? Please teach/show
Some management accountants argue that absorption costing provides an incentive to continue producing goods for inventory, even when sales decline.
In ABC's 2008 income statement, what amount should be reported for total income tax expense?
"I don't understand these crazy variable-overhead efficiency variances. My employees are very careful in their use of electricity and manufacturing supplies, and we use very little indirect labor. What are we supposed to do?"
I would like to have more clarification on the two formats of an income statement. Are there certain situations that would make it beneficial to use one format versus the other?
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