Which of the following is not a reason to interpret book value with caution?
a. Land may be worth more than it cost
b. Depreciable assets may be held
c. Investments may be worth more than their purchase price
d. Patents may have a high market value
e. All of the answers are correct.
E
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In a vertical analysis, the base for cost of goods sold is
a. total selling expenses b. sales c. total expenses d. gross profit
All of the following are the general principles underlying the valuation of liabilities except:
a. Liabilities requiring future cash payments appear at the present value of the required future cash flows discounted at an interest rate that reflects the uncertainty that the firm will be able to make the cash payments. b. The fair value of a liability cannot differ from the amount appearing on the balance sheet, particularly for long-term debt. c. Liabilities representing cash advances from customers appear at the amount of the cash advance. d. Liabilities requiring the future delivery of goods or services appear at the estimated cost of those goods and services.
Bonnie Company has a direct labor standard of 15 hours per unit of output. Each employee has a standard wage rate of $14 per hour. The standard variable overhead rate is $10 per hour. During March, employees worked 13,100 hours. The direct labor rate variance was $9,170 favorable, the variable overhead rate variance was $13,100 unfavorable, and the direct labor efficiency variance was $15,400 unfavorable. What is the actual variable overhead?
A. $117,900 B. $144,100 C. $183,400 D. $131,000
Acme, Inc., produces widgets. To manufacture a new type of widget, it took 50 hours for the first widget. Acme estimates it has a 90% learning rate. Using the logarithmic approach, calculate the time it will take to manufacture the 60th widget.
a. 26.85 hours b. 32.70 hours c. 22.55 hours d. 21.42 hours