Gnome Company is deciding whether to continue to manufacture a component or to buy the component from a supplier. Which of the following is relevant to this decision?
A) the potential uses of the facilities that are currently used to manufacture the component
B) the insurance on the manufacturing facility that will continue regardless of the decision
C) fixed costs that do not differ between the alternatives
D) the cost of the equipment that is currently being used to manufacture the component
A) the potential uses of the facilities that are currently used to manufacture the component
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Which of the following would not be considered to be an intangible asset?
a. Franchises b. Copyrights c. Investments d. Goodwill
Discuss whether a corporation may indemnify a director, officer or employee for the cost of defending and/or settling a lawsuit or criminal charge brought against the director, officer or employee.
What will be an ideal response?
On December 31, Strike Company has decided to sell one of its batting cages. The initial cost of the equipment was $215,000 with an accumulated depreciation of $185,000. Depreciation has been taken up to the end of the year. The company found a company that is willing to buy the equipment for $20,000. What is the amount of the gain or loss on this transaction?
A) Gain of $20,000 B) Loss of $10,000 C) No gain or loss D) Cannot be determined
Avery Inc would like to prepare a summary cash budget for June. The following information is available: · The cash balance at June 1 was estimated to be $6,000. · June sales, all on account, were estimated to be $75,000. Sales are collected over a two-month period with 60 percent collected in the month of sale and the remainder in the subsequent month. May sales on account were $70,000. ·
Inventory purchases are expected to be $50,000 in June. The company pays for one-half of inventory purchases in the month of purchase and the remainder in the subsequent month. May purchases were $60,000. · Cash disbursements for selling and administrative expenses are expected to be $9,000 in June. · Depreciation expense for June is expected to be $3,000. What is the cash balance at the end of June expected to be? A) $15,000 B) $12,000 C) $26,000 D) $29,000