Gion Company is considering eliminating its windows division, which reported an operating loss for the recent year of $105,000. Division sales for the year were $1,110,000 and its variable costs were $975,000. The fixed costs of the division were $220,000. If the windows division is dropped, 65% of the fixed costs allocated to it could be eliminated. The impact on Gion's operating income from eliminating this business segment would be:
A. $8,000 decrease
B. $7,200 decrease
C. $143,000 increase
D. $8,000 increase
E. $143,000 decrease
Answer: D
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_____ is an attribute of qualitative research that affirms that key members within a culture or subculture agree with the findings of a research report.
A. Tabulation B. Emic validity C. Triangulation D. Iteration E. Cross-researcher reliability
How is an equity alliance different from a joint venture?
A. An equity alliance involves taking ownership in a partner; a joint venture involves two or more entities owning a firm. B. An equity alliance involves partners contributing equity to a joint venture; a joint venture involves two or more entities owning a firm. C. An equity alliance involves taking ownership in a partner; a joint venture involves taking ownership by buying stock. D. An equity alliance involves ownership that facilitates transaction-specific ventures; a joint venture involves taking ownership by buying stock.
Carver Lumber sells lumber and general building supplies to building contractors in a medium-sized town in Montana. Data regarding the store's operations follow:•Sales are budgeted at $350,000 for November, $320,000 for December, and $300,000 for January. •Collections are expected to be 90% in the month of sale and 10% in the month following the sale. •The cost of goods sold is 75% of sales. •The company desires to have an ending merchandise inventory equal to 60% of the following month's cost of goods sold. Payment for merchandise is made in the month following the purchase. •Other monthly expenses to be paid in cash are $24,700. •Monthly depreciation is $16,000. •Ignore taxes. Balance SheetOctober 31AssetsCash$19,000Accounts
receivable 77,000Inventory 157,500Property, plant and equipment, net of $502,000 accumulated depreciation 1,002,000Total assets$1,255,500Liabilities and Stockholders' EquityAccounts payable$272,000Common stock 780,000Retained earnings 203,500Total liabilities and stockholders' equity$1,255,500Accounts payable at the end of December would be: A. $96,000 B. $135,000 C. $240,000 D. $231,000
The standards for accountants' professional liability can be found in all of the following except: ______
A) court decisions. B) the actual contract. C) GAAP and GAAS standards. D) the common law.