Joint costs may be allocated to main products, but not to by-products
Indicate whether the statement is true or false
F
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Schwiesow Corporation has provided the following information: Cost per UnitCost per PeriodDirect materials$7.05 Direct labor$3.50 Variable manufacturing overhead$1.65 Fixed manufacturing overhead $11,000Sales commissions$1.00 Variable administrative expense$0.40 Fixed selling and administrative expense $5,500If 4,000 units are sold, the variable cost per unit sold is closest to:
A. $13.60 B. $12.20 C. $16.90 D. $14.40
The sequence of the budgets within the master budget begins with the capital expenditures budget.
Answer the following statement true (T) or false (F)
Copybold Corporation is a start-up that has a capital structure that calls for a debt/assets ratio of 0.75. There are two possible scenarios with respect to the firm's operations: Feast and Famine. The Feast scenario has a 60 percent probability of occurring, and the forecast earnings before interest and taxes (EBIT) in this scenario is $60,000. The Famine scenario has a 40 percent chance of occurring, and the EBIT is expected to be $20,000. Further, the cost of debt for this capital structure will be 12 percent. The firm will have $400,000 in total assets, and it will face a marginal tax rate of 40 percent. The company has 10,000 outstanding shares. What is the difference between the earnings per share (EPS) forecasts for Feast and Famine?
A. $0 B. $2.40 C. $1.48 D. $0.62 E. $0.98
According to the theory of absolute advantage, which of the following is true of a nation with free trade?
A. A nation gains by specializing in economic activities in which it has an absolute advantage. B. A nation gains absolute advantage by restricting trade with other countries. C. A nation gains tremendously by focusing on economic activities in which it has a comparative advantage. D. A nation will develop absolute advantage based on its locally abundant factors.