Based on the income statements shown below, which division has the cost structure with the highest operating leverage? Soft Drinks Bottled Water Fruit JuicesRevenue$50,000 $50,000 $50,000 Variable costs (10,000) (5,000) (30,000)Contribution margin 40,000 45,000 20,000 Fixed costs (30,000) (40,000) (10,000)Net income$10,000 $5,000 $10,000
A. Bottled Water.
B. The three divisions have identical operating leverage.
C. Soft Drinks.
D. Fruit Juices.
Answer: A
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Time tickets for factory employees during the month of August are summarized as follows:Job 919…………………………………………$ 9,800Job 920…………………………………………14,650Job 921…………………………………………12,250Job 922………………………………………… 16,000Total direct labor……………………………….$52,700Indirect labor…………………………………... 16,800Total labor cost………………………………...$ 69,500??Prepare the necessary journal entries to record factory payroll for direct and indirect labor.
What will be an ideal response?