A company paid $200,000 ten years ago for a specialized machine that has no salvage value and is being depreciated at the rate of $10,000 per year. The company is considering using the machine in a new project that will have incremental revenues of $28,000 per year and annual cash expenses of $20,000. In analyzing the new project, the $200,000 original cost of the machine is an example of a(n):

A. Opportunity cost.
B. Incremental cost.
C. Out-of-pocket cost.
D. Sunk cost.
E. Variable cost.


Answer: D

Business

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Answer the following statements true (T) or false (F)

The direct method requires a schedule reconciling net operating cash flow with net income.

Business

Niles Corporation is a manufacturer that uses job-order costing. The company has supplied the following data for the just completed year:  Beginning inventories:   Raw materials$47,000 Work in process 20,000 Estimated total manufacturing overhead at the beginning of the year$646,250 Estimated direct labor-hours at the beginning of the year 47,000direct labor-hours Results of operations:  Raw materials purchased on account$538,000 Raw materials (all direct) requisitioned for use in production$535,000 Direct labor cost$699,000 Actual direct labor-hours 37,000direct labor-hoursManufacturing overhead:   Indirect labor cost$134,000 Other manufacturing overhead costs incurred$453,000 Cost of goods manufactured$1,568,000   The ending balance in the Work in Process

inventory account is: A. $194,750 B. $214,225 C. $154,750 D. $174,750

Business

Explain the concept and significance of identification of goods. Discuss how identification takes place

Business

Harvey's Car Rental rents Darlene an intermediate-size car at $159 per week for her business trip. What is the relationship between Harvey's and Darlene?

a. A bailment for mutual benefit. b. A bailment for the sole benefit of the bailee. c. A bailment for the sole benefit of the bailor. d. The temporary transfer of title to Darlene.

Business