Scheuer Corporation uses activity-based costing to compute product margins. In the first stage, the activity-based costing system allocates two overhead accounts-equipment expense and indirect labor-to three activity cost pools-Processing, Supervising, and Other-based on resource consumption. Data to perform these allocations appear below:Overhead costs: Equipment expense$55,000Indirect labor$7,000??Distribution of Resource Consumption Across Activity Cost Pools: Activity Cost Pools ProcessingSupervisingOtherEquipment expense0.100.700.20Indirect labor0.500.100.40Finally, sales and direct cost data are combined with Processing and Supervising costs to determine product margins.Activity: MHs (Machining)Orders (Order Filling)Product Q!1,000700Product
S619,0001,300Total20,0002,000Finally, sales and direct cost data are combined with Processing and Supervising costs to determine product margins.Sales and Direct Cost Data: Product Q1Product S6Sales (total)$134,600$186,300Direct materials (total)$76,000$64,800Direct labor (total)$40,800$78,400The activity rate for the Processing activity cost pool under activity-based costing is closest to:
A. $0.28 per MH
B. $5.00 per MH
C. $0.45 per MH
D. $3.10 per MH
Answer: C
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Under the right of subrogation, the insurer ________.
A. is obliged to pay the face value of the policy on the death of the insured and the specified premium for the duration of his/her life B. obtains all of the insured's rights to pursue legal remedies only against those persons who have intentionally damaged the insured property C. obtains all of the insured's rights to pursue legal remedies against anyone who may have negligently or intentionally damaged the insured property D. is obliged to pay only the face amount of the policy if the insured dies within a specified period of time; which is the term of the policy
How is the bargain element for a stock option calculated?
A. The difference between the market price on the sale date and the strike price. B. The difference between the strike price and the market price on the date of grant. C. The difference between the market price on the exercise date and the strike price. D. The difference between the market price on the exercise date and the market price on the date of grant.
Which of the following is the most important reason for defining decision variables as part of linear programming (LP) formulation?
a. The decision variables will set the stage for the rest of the formulation steps. b. The value of the decision variables will determine how many units will be produced at any given time. c. The value of the decision variables will determine how many constraints are needed in the LP model. d. The decision variables also determine how many goals the decision maker must achieve.
Last year Hamdi Corp. had sales of $500,000, operating costs of $450,000, and year-end assets (which is equal to its total invested capital) of $385,000. The debt-to-total-capital ratio was 17%, the interest rate on the debt was 7.5%, and the firm's tax rate was 35%. The new CFO wants to see how the ROE would have been affected if the firm had used a 50% debt-to-total-capital ratio. Assume that sales, operating costs, total assets, total invested capital, and the tax rate would not be affected, but the interest rate would rise to 8.0%. By how much would the ROE change in response to the change in the capital structure? Do not round your intermediate calculations.
A. 2.08% B. 2.46% C. 2.01% D. 2.51% E. 2.64%