An equity index is a measure of the performance of certain stocks that are included in a particular portfolio in relation to a base value established earlier. A measure of performance refers to a method used to evaluate the effectiveness of an investment strategy.
In the context of investing, a measure of performance can be used to assess the performance of certain stocks that are included in a particular portfolio in relation to a base value established earlier. This base value is usually a benchmark that represents the average performance of the market or a specific sector.
By comparing the performance of individual stocks or a portfolio to this benchmark, investors can determine whether their investments are performing better or worse than the overall market. This information can help investors make informed decisions about whether to buy, hold or sell stocks in their portfolio.
In summary, a measure of performance is a vital tool for investors to evaluate the effectiveness of their investment strategy, and it enables them to make informed decisions that can lead to better investment outcomes.
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sakait has done some extra work to appease a client. now the client is asking her to do one more task, which is significant and not part of project scope. what should sakait do?
If a client is asking Sakait to do a task that is not part of the project scope, then she should approach the situation professionally. Sakait should review the client's request, and determine if the request is feasible to complete without disrupting the current project scope or affecting the project deadline.
She can also provide an estimated cost for the extra work that would have to be done. In this case, Sakait can:
1. Explain that the new request is outside the project scope, and provide a valid explanation to the client.
2. Provide the client with an estimate of the cost to complete the additional task and the timeline.
3. If the client agrees to the additional work, Sakait should ensure the details of the work are documented to avoid confusion later.
If the extra work is not feasible, and the client insists that the work be completed, Sakait should decline the request. In this case, Sakait would have to explain the reasons to the client why the extra work cannot be performed without disrupting the project schedule or causing other significant problems.
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Food ____ measure the food available for consumption from imports and domestic food production minus the food through exports, waste, or spoilage.
a. records
b. questionnaires
c. histories
d. balance sheets
Balance sheets are financial statements that provide a snapshot of an organization's financial position by showing its assets, liabilities, and equity at a specific point in timeThe correct answer is d. balance sheets.
In the context of the given question, balance sheets are used to measure the food available for consumption by calculating the net quantity of food from imports and domestic production after subtracting food losses through exports, waste, or spoilage.
Balance sheets provide a comprehensive overview of the food supply situation by taking into account both the sources of food (imports and domestic production) and the factors that reduce the available food (exports, waste, or spoilage). They are a valuable tool for analyzing and managing food resources and can be used by policymakers, researchers, and organizations involved in food security and agriculture.
On the other hand, options such as records, questionnaires, and histories are not specifically designed to measure the available food for consumption or account for factors like exports, waste, or spoilage. While these methods may be used in gathering data for food analysis, balance sheets are the most appropriate choice for quantifying the net food available for consumption after accounting for various factors affecting the food supply.
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Zander is beginning to take college courses to prepare for a career in computer science, which is the study of using logic to create new and improved computer programs. He just finished a class that covered skills for using certain computer programs, but was not required for a degree. What did Zander take steps to improve by taking this class?
A. career definition and career requirements
B. career requirements and current status
C. current status and intermediate goals
D. intermediate goals and career definition
(20 points)
Answer: A career definition and career requirements
Explanation:
edge2020
Zander has taken steps to improve career definition and career requirements by taking this course.
How to choose the ideal career?It is essential that the individual collects as much information as possible about the career from diverse sources, such as qualified professionals, books and institutional websites, increasing their knowledge of roles and responsibilities.
Therefore, when choosing a course in the intended career, Zander is trying to improve his career requirements.
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Edge Company produces two models of its product with the same machine. The machine has a capacity of 142 hours per month. The following information is available.
Standard = (70 units * 1) = 70 hours
Deluxe = (140 - 70) = (70 hours / 2) = 35 units.
How to find the contribution marginRequired 1: Determine the contribution margin per machine hour for each model.
Product Contribution Margin
Standard
Deluxe
Contribution margin per unit
$50
$40
(/) Machine hours per unit
1
2
Contribution margin per machine hour
$50
$20
Step 2/3
Required 2: How many units of each model should the company produce?
Standard
Deluxe
Total
Hours dedicated to the production of each product
140
0
$140
Units produce for the most profitable sales mix
140
0
Contribution margin per unit
$50
0
Total contribution margin
$7,000
$0
$7,000
Required 3: Assume the maximum demand for the standard model is 70 units (not 600 units). How many units of each model should the company produce?
Standard
Deluxe
Total
Hours dedicated to the production of each product
70
70
140
Units produce for the most profitable sales mix
70
35
Contribution margin per unit
$50
$40
Total contribution margin
$3,500
$1,400
$4,900
Total available hours = 140 hours
Standard = (70 units * 1) = 70 hours
Deluxe = (140 - 70) = (70 hours / 2) = 35 units.
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Cute Camel Woodcraft Company is a small firm, & several of its managers are worried about how soon the firm will be able to recover its initial investment from Project Omega’s expected future cash flows. To answer this question, Cute Camel’s CFO has asked that you compute the project’s payback period using the following expected net cash flows & assuming that the cash flows are received evenly throughout each year.
Cute Camel Woodcraft Company is a small company that is interested in knowing how long it would take for the firm to recover its initial investment from Project Omega’s expected future cash flows. The expected net cash flows have been provided, and it has been assumed that the cash flows will be received evenly throughout each year.
To determine the payback period, we need to calculate the time it would take for the project's cash inflows to equal its initial investment. To calculate the payback period, we need to add the expected net cash flows until the sum equals the initial investment. The initial investment for Project Omega is not provided, so we will not be able to calculate the payback period without it. However, we can use a general formula to calculate the payback period. Suppose the expected net cash flows for each year are CF1, CF2, CF3, and so on. Then the payback period is given by the formula:
Payback Period = A + (B / C)
Where, A = the last period with a negative cumulative cash flow
B = absolute value of cumulative cash flow at the end of the A period
C = cash flow during the period after A.
Let's say the expected net cash flows for Project Omega are as follows:
Year 1: $20,000
Year 2: $30,000
Year 3: $40,000
Year 4: $50,000
Year 5: $60,000
If the initial investment is $100,000, then we can calculate the payback period as follows:
Year 1: $20,000 (cumulative cash flow: $20,000, still $80,000 to recover)
Year 2: $30,000 (cumulative cash flow: $50,000, still $50,000 to recover)
Year 3: $40,000 (cumulative cash flow: $90,000, still $10,000 to recover)
Year 4: $50,000 (cumulative cash flow: $140,000, fully recovered)
In this case, the payback period would be 3 years since it took three years to recover the initial investment. However, this calculation assumes that the cash flows are received evenly throughout each year, which may not be the case. Therefore, it is essential to analyze the project's cash flow pattern in more detail to get a more accurate estimate of the payback period.
Therefore, Cute Camel's CFO wants to compute Project Omega's payback period to estimate the time it would take for the company to recover its initial investment from the project's expected cash flows. The payback period can be calculated by adding the expected net cash flows until the sum equals the initial investment. The payback period formula is given as Payback Period = A + (B / C). The payback period is useful for assessing the project's risk and for comparing different projects with similar investment requirements.
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In Country A, the State controls ALL the factors of production. Country A could be described as a country that is operating within a:
A. free market economic system
B. laissez-faire economic system
C. mixed economic system
D. planned economic system
the level of savings in an economy: multiple choice can be an important determinant of future productivity. can be an important determinant of capital investment. can be a source of funding for physical capital. all of these are true.
the level of savings in an economy:
determinant of future productivity. can be an important determinant of capital investment. can be a source of funding for physical capital.Thus, all of these are true and correct.
What is saving?Savings are unspent income or deferred consumption. One way to save is to spend money. Set aside in a savings account, retirement account, mutual fund, or cash. Savings also means reducing expenses, such as recurring expenses.Savings are the portion of your income that is not spent on current expenses. In other words, it is money that is reserved for future use and not immediately spent.Saving is a way out of life's uncertainties and offers opportunities for quality living. Many hurdles and obstacles in life can be overcome by systematically investing large sums of money.
Thus, saving means a determinant of future productivity which can be an important determinant of capital investment and it can be a source of funding for physical capital.
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can someone explain what bitcoin is? i don't get it is it illegal? how does it work?
Answer:
Bt Bicoins este o moneda virtuala care valorează extrem de mult, nu, nu este ilegal sa ai un bit coin
Answer: Bit coin is crypto-currency. It was made by a guy called Satoshi Nakamoto. No bit coin is perfectly legal. Basically how it works is frst you have to buy a bitcoin wallet. Once you buy that it will give you a bitcoin address so that way your friends and family or whoever can pay you. In a nutshell it's basically Pay-Pal.
Explanation: Also, I'm currently 3D printing the Tesla Cyber truck. This is the model I have so far. What do you think? Do you think I can go ahead and print it?
The journal entry a company uses to record accrued vacation privileges for its employees at the end of the year is:.
The record of accrued vacation privileges in Journal entry will includes a Debit of Cash& Interest Expense and Credit of Notes Payable
What is a Journal entry?The Journal entry helps to record all basic financial transaction.
In conclusion, the record of accrued vacation privileges in Journal entry will includes a Debit of Cash& Interest Expense and Credit of Notes Payable
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Preparation of Adjusting Entries Bartow Photographic Services takes wedding and graduation photographs. At December 31, the end of Bartow's accounting period, the following information is available: All wedding photographs are paid for in advance, and all cash collected for them is credited to Unearned Service Revenue. Except for a year end adjusting entry, no other entries are made for service revenue from wedding photographs. During the year, Bartow received $42,600 for wedding photographs. At year end, $37,480 of services had been performed. The beginning-of-the-year balance of Unearned Service Revenue was zero. During December, Bartow photographed 228 members of the next year's graduating class of Shaw High School. The school has asked Bartow to print one copy of a photograph of each student for the school files. Bartow delivers these photographs on December 28 and will bill the school $5.00 per student in January of next year. Revenue from photographs ordered by students will be recorded as the orders are received during the early months of next year. Equipment used for developing and printing was rented for $22,500. The rental term was for 1 year beginning on August 1 and the entire year of rent was paid on August 1. The payment was debited to Prepaid Rent. Depreciation on the firm's building for the current year is $9,390. Wages of $4,170 are owed but unpaid and unrecorded at December 31. Supplies at the beginning of the year were $2,400. During the year, supplies costing $19,600 were purchased from Kodak. When the purchases were made, their cost was debited to Supplies. At year end, a physical inventory indicated that supplies costing $4,100 were on hand.
Conceptual Connection: By how much would net income be overstated or understated if the accountant failed to make the adjusting entries?
Answer:
The enetres below suggests that the reader aka you doesnt know how to do work
Explanation:
study
whats the difference between net, gross, and operating profit
On January 1, 2024, the general ledger of Grand Finale Fireworks includes the following account balances:
Accounts Debit Credit Cash $ 43,100 Accounts Receivable 45,300 Supplies 7,900 Equipment 68,000 Accumulated Depreciation $ 9,400 Accounts Payable 15,000 Common Stock, $1 par value 14,000 Additional Paid-in Capital 84,000 Retained Earnings 41,900 Totals $ 164,300 $ 164,300
During January 2024, the following transactions occur:
January 2 Issue an additional 2,100 shares of $1 par value common stock for $42,000.
January 9 Provide services to customers on account, $15,300.
January 10 Purchase additional supplies on account, $5,300.
January 12 Purchase 1,100 shares of treasury stock for $19 per share.
January 15 Pay cash on accounts payable, $16,900.
January 21 Provide services to customers for cash, $49,500.
January 22 Receive cash on accounts receivable, $17,000.
January 29 Declare a cash dividend of $0. 20 per share to all shares outstanding on January 29. The dividend is payable on February 15. (Hint: Grand Finale Fireworks had 14,000 shares outstanding on January 1, 2021, and dividends are not paid on treasury stock. )
January 30 Resell 700 shares of treasury stock for $21 per share.
January 31 Pay cash for salaries during January, $42,400.
The following information is available on January 31, 2021.
a. Unpaid utilities for the month of January are $6,600.
b. Supplies at the end of January total $5,500.
c. Depreciation on the equipment for the month of January is calculated using the straightline method. At the time the equipment was purchased, the company estimated a service life of three years and a residual value of $10,400.
d. Accrued income taxes at the end of January are $2,400.
I need help with closing entry for revenue, expenses, and dividends. As well as an income statement, balance sheet, and analysis
It is impossible to produce a full set of closing entries or financial statements without further data on income, costs, and dividends. Debiting all revenue accounts and crediting the income summary account, as well as debiting the income summary account and crediting all expense accounts, would be the standard procedure for closing entries.
By making a debit to the retained profits account and a credit to the dividends account, dividends would be closed. The final balances in the revenue, expense, and dividend accounts should be zero once all closing entries have been made, and the balance in the income summary account should indicate the period's net profit or loss.
A formal income statement and balance sheet can be created using the closing entries. While the balance sheet would disclose all assets, liabilities, and equity accounts as of the end of the period, the income statement would indicate revenues, expenses, and net income or loss for the period. Comparing the results to prior quarters, industry benchmarks, and corporate goals would be part of an analysis of the financial statements, as well as highlighting areas of strength and weakness that could need further attention or action.
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Based on the lesson, what would most affect the price a consumer is willing to pay for a newer version of a laptop computer?
Answer:
sufficient products to meet consumer wants. Every economic decision has. a consequence or tradeoff.
Rating
Answer:
Thhe answer is B hope I helped. :)
Explanation:
KNX Corp commits to pay a dividend of $5.20 in year 1, $6.0 in year 2, and $7.5 in year 3, a share. After that, the annual dividend will be $11.00 per share indefinitely.
What is the value of KNX Corp today assuming investors require a return of 9.8 percent?
A.
$114.7
B.
$82.1
C.
$100.2
D.
$66.70
the value of KNX Corp today, assuming investors require a return of 9.8 percent, is $151.99. The closest answer choice to this value is (A) $114.7, which is incorrect.
To calculate the present value of KNX Corp, we need to find the present value of each of the individual dividend payments and the present value of the perpetual dividend.
First, let's calculate the present value of the first three years of dividends using the formula for the present value of a growing annuity:
PV = C / (r - g) * (1 - (1 + g / (1 + r))(-n))
where PV is the present value, C is the cash flow in year 1, r is the required rate of return, g is the growth rate, and n is the number of periods.
Using this formula, we get:
PV = 5.20 / (1 + 0.098 - 0.03) * (1 - (1 + 0.03 / (1 + 0.098))(-3)) + 6.00 / (1 + 0.098 - 0.05) * (1 - (1 + 0.05 / (1 + 0.098))(-2)) + 7.50 / (1 + 0.098 - 0.06) * (1 - (1 + 0.06 / (1 + 0.098))(-1))
PV = 16.42 + 16.09 + 7.24
PV = 39.75
Next, let's calculate the present value of the perpetual dividend using the formula for the present value of a perpetuity:
PV = C / r
where PV is the present value, C is the cash flow, and r is the required rate of return.
Using this formula, we get:
PV = 11.00 / 0.098
PV = 112.24
Finally, we can add the present value of the first three years of dividends to the present value of the perpetual dividend to get the total present value:
Total PV = 39.75 + 112.24
Total PV = 151.99
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hat is the difference between a real estate space market and the real estate asset market? group of answer choices
The difference between real estate space market and the real estate asset market is the real estate space market deals with physical capital. While the real estate asset market deals with financial capital.
The real estate assets generally can be described as a real property and shares. The real property in real estate assets including interests in real property and also interests in mortgages on real property or on interests in real property. The examples of commercial real estate market are office, industrial, retail, residential, and hospitality. Real estate property also can be classified as an asset class that plays a significant role in many investment portfolios.
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QUESTION 1 Suppose a firm has the following demand and cost
functions Q(P) = 67230 - 1245P and C(q) = 42 Q + 5820
Find profits at the profit maximizing price and quantity
To find the profits at the profit-maximizing price and quantity, we need to follow some steps given below.
Step 1: Find the revenue function.The revenue function can be found by multiplying the price (P) by the quantity demanded (Q).R(P) = P * Q(P)We have the demand function:Q(P) = 67230 - 1245PRearranging the above equation to express P in terms of Q:P = (67230 - Q) / 1245
Now, the revenue function can be written as:R(Q) = Q * P = Q * [(67230 - Q) / 1245]R(Q) = (67230Q - Q^2) / 1245
Step 2: Find the marginal revenue function.The marginal revenue (MR) function can be found by taking the derivative of the revenue function with respect to quantity demanded (Q).MR(Q) = dR(Q) / dQMR(Q) = (67230 - 2Q) / 1245
Step 3: Find the cost function.The cost function is given as:C(q) = 42 Q + 5820Where C(q) is the total cost of producing q units of the product.Step 4: Find the marginal cost function.
The marginal cost (MC) function can be found by taking the derivative of the cost function with respect to quantity produced (q).MC(q) = dC(q) / dqMC(q) = 42
Step 5: Find the profit-maximizing quantity.The profit-maximizing quantity is the quantity at which MR = MC.MR(Q) = MC(q)(67230 - 2Q) / 1245 = 42Solving for Q, we get:Q = 27570Plugging this value of Q into the demand function,
we get:P = (67230 - 27570) / 1245P = 26.12
Step 6: Find the maximum profit.The maximum profit can be found by subtracting the total cost from the total revenue.π = R(Q) - C(q)π = (67230Q - Q^2) / 1245 - (42 Q + 5820)π = (67230(27570) - (27570)^2) / 1245 - (42 (27570) + 5820)π = 54842460 / 1245 - 1170240π = $43,940.56,
the profits at the profit-maximizing price and quantity are $43,940.56.
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2. Choose any national or global chain with an online presence. Do a web search and spend time looking at their website. List the company's strengths in the space below. You may write in complete sentences or list form. (5-10 strengths) TIP: Look for strengths in different areas (product, price, promotion, place, sales, distribution).
The correct answer to this open question is the following.
I choose the Amazon website to answer this question.
These are the strengths of this global company.
-First, it has a presence almost worldwide, due to the benefits of e-commerce.
-Reputation. It has a good reputation because serves the customer well.
-Infrastructure. World-class facilities and delivery infrastructure to get the product on time.
-Variety of products. You access the company's website and can find anything. From books to toys, movies, and furniture.
-Prices. Accessible or competitive process because that is the advantage of e-commerce.
-Customer Service. Good client service that aims for entire satisfaction.
-Promise of delivery. Delivery time. Period.
a customer relationship management (crm) system helps a company in managing ______.
A customer relationship management (CRM) system helps a company in managing distribution and accounting.
What is meant by customer relationship management?Customer relationship management (CRM) is a technology that organizes all of your business's interactions and relationships with current and potential clients. Simple is the objective: Boost communication between companies. Companies can improve profitability, process efficiency, and client retention using a CRM system.
Customer relationship management is a method that helps businesses and other organizations manage their contacts with customers. This examination of a lot of data is often used in this process. Operational, analytical, and collaborative CRM systems are the three different categories. Throughout the customer lifecycle, businesses manage and analyze customer interactions and data using a variety of techniques, strategies, and technology together known as customer relationship management (CRM).
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1. In the POW camps of WWII, what did prisoners do with the contents of their Red Cross packages
that "maximized individual satisfaction"?*
(1 Point)
Prisoners gave away things they didn't want
Prisoners traded for what they wanted.
Prisoners hoarded their meager supplies.
Answer:
The correct option is;
Prisoners traded for what they wanted
Explanation:
In the war camps, being that there where no privileged persons, everyone had to trade what they where given as rations for what they needed and as such trading became predominant in the camp as those who could afford to manage without taking some of the package contents from the Red Cross such as beef, coffee, biscuits and cheese can trade for other items with some making small fortunes in cigarettes (which became more or less the currency) and biscuits.
Advertising, sales promotion, public relations, and buzz building activities are all ________. A) channels that should be integrated under the concept of integrated marketing communications B) channels focused more on interactive marketing than traditional marketing C) promotional tools used for push strategies but not pull strategies D) promotional tools used for pull strategies but not push strategies
Answer:
B
Explanation:
Hope it helped you1
PLEASE HELP QUICKLY: (FIRST ANSWER GETS BRAINLIEST) PERSONAL & FAMILY FINANCE
Trina wants to start a company that makes clothing. She has a lot of ideas, but she doesn’t have any sewing machines to use to make the clothes. Which category of economic resource does she require?
labor
entrepreneurial ability
capital
Answer:I think b
Explanation:
Trina requires capital category of economic recourse because to buy sewing machines. The correct optin is (c).
What is capital in business?Capital in business refers to the cash, machines, any type of assets, bills receivable, patents etc. which is used for the business purpose.
Capital is the life line of every business. Every business assets which are used for the business activity they create the value of the business and consider as the capital of the business. Capital is the financial assets which is used in the business.
Trina wants to start the business for making clothes, so she wants to buying the sewing machines for their business and in this case the lack of capital resources. Trina wants cash to buy the sewing machines to the
start the business.
Capital is classified as assets in terms of accounting. Capital is the blood of business. Therefore to every entrepreneur needs the capital for their business/company.
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Which of the following could be a trade secret?
where are the questions there are not questions
how am i supposed to help you if there is no questions
Which of the following statement is correct? Primary markets are markets dealing in new securities such as IPO's. All of the statements are correct. Secondary markets are markets where existing securities are traded among investors. Foreign exchange market is a market where one currency is traded for another. Question 2 How is the coupon rate of a bond different from the required rate of return of Required rate of return is the contractually paying out rate whereas coupon rate fluctuates. The coupon rate of a bond is the total return earned by bond investors whereas the required rate of return of a bond is a part of the total return earned by bond investors. Required rate of return is the interest rate demanded by the investor whereas coupon rate is the fixed rate provided on the security. The coupon rate of a bond is the same as the required rate of return of a bond.
"Secondary markets are markets where existing securities are traded among investors." Investors trade existing securities among themselves in secondary markets, facilitating buying and selling of circulated financial instruments.
The coupon rate of a bond is the fixed rate provided on the security, while the required rate of return is the interest rate demanded by the investor. The coupon rate represents the annual interest payment a bondholder receives, expressed as a percentage of the bond's face value. On the other hand, the required rate of return is the minimum rate of return an investor expects to earn to compensate for the risk of investing in the bond. It is influenced by factors such as market conditions, the bond's creditworthiness, and the investor's own risk preferences. Therefore, the coupon rate and the required rate of return are different aspects of bond investing, serving different purposes in determining the bond's attractiveness to investors.
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True or false? when creating a budget to repay your student loans, you can save money by paying only the interest.
According to the budget office, Biden's plan to cancel student loans will cost $400 billion. The Congressional Budget Office stated in a report that the cost of the White House's student loan forgiveness plan is an estimate over a 30-year period and will increase the nation's deficit.
Explain about the budget to repay student loans?
Paying more than the required minimum each month is the most effective approach to pay off student debt. The more you put toward your debts, the more you'll save on interest and the faster the sum will be paid off. Use a student loan payoff calculator to determine how quickly you might pay off your debt and how much you would save on interest.
To save money, you can pay your student loans with interest alone. Making these payments prior to graduating, or while deferring repayment, can prevent the addition of thousands of dollars in interest to the balance of your loan.
Since you'll be paying less interest, paying off your private or federal loans early can help you save thousands of dollars over the course of your loan. If you do have high-interest debt, refinancing it will make your money work harder for you.
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Project selection criteria are typically classified as:__________
The selection criteria for projects are often divided into qualitative and quantitative categories.
What standards apply to a project?The triple constraints—cost, scope, and time—are the three requirements for project success. Although the specifications may vary based on the project's business, employer, or aim, success depends on these three factors.
What three project criteria are there?The three components are scope, time, and cost. Any modification to one of these components will require a change in another component as well. This article describes the project management triangle's theory and how to apply it to successfully manage projects even while requirements and circumstances change ineluctably.
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mike started a calendar-year business on september 1st of this year by paying 12 months of rent on his shop at $700 per month. what is the maximum amount of rent that mike can deduct this year under each type of accounting method?
The maximum amount of rent that Mike can deduct this year depends on the accounting method he is using. That is $ 2800 under the cash method and $ 8400 under the accrual method.
If Mike is using the cash method of accounting, he can deduct the rent payments that he actually paid during the tax year. Since he started the business on September 1st, he would have paid rent for the months of September, October, November, and December, a total of 4 months. Therefore, the maximum amount of rent that he can deduct this year is $700 x 4 = $2800.
If Mike is using the accrual method of accounting, he can deduct rent payments for the period that he is entitled to the use of the property, regardless of when he paid the rent. Since he started the business on September 1st and paid 12 months of rent in advance, he is entitled to use the property for the entire year. Therefore, the maximum amount of rent that he can deduct this year is $700 x 12 = $8400.
It's important to note that if Mike elected to use the cash method of accounting, he must stick with it for at least the first year of business and for future years unless he receives the IRS approval to change it.
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A product in the __________ stage of the product life cycle has a high number of competitors and competitive products.
Answer:
Maturity stage
Explanation:
dose anyone know the answer to this question?
(Appendix 4B) Sequential Method of Support Department Cost Allocation Stevenson Company is divided into two operating divisions: Battery and Small Motors. The company allocates power and general factory costs to each operating division using the sequential method. General Factory is allocated first in the sequential method for the company. Support department cost allocations using the sequential method are based on the following data: Support Departments Operating Divisions Power General Factory Battery Small Motors Overhead costs $160,000 $430,000 $163,000 $84,600 Machine hours 2,000 2,000 9,000 3,000 Square footage 1,000 1,500 10,000 20,000 Direct labor hours 18,000 60,000 Required: 1. Calculate the allocation ratios for Power and General Factory. (Note: Carry these calculations out to four decimal places.) Allocation ratios for General Factory
The allocation ratios for the Power support department are calculated in the same way, using the overhead costs and the same three allocation base ratios (machine hours, square footage, and direct labor hours).
How do you calculate the allocation ratios for the General Factory support department?The allocation ratios for the General Factory support department can be calculated as follows:
Machine hours ratio:
Battery: 9,000 machine hours / 2,000 total machine hours = 4.5
Small Motors: 3,000 machine hours / 2,000 total machine hours = 1.5
Square footage ratio:
Battery: 10,000 square feet / (1,000 total square feet + 1,500 total square feet) = .625
Small Motors: 20,000 square feet / (1,000 total square feet + 1,500 total square feet) = 1.375
Direct labor hours ratio:
Battery: 60,000 direct labor hours / 18,000 total direct labor hours = 3.333
Small Motors: 18,000 direct labor hours /18,000 total direct labor hours= 1
The allocation ratios for the General Factory support department are calculated by taking the average of the three ratios.
Machine hours ratio: (4.5 + 1.5) / 2 = 3
Square footage ratio: (.625 + 1.375) / 2 = 1.5
Direct labor hours ratio: (3.333 + 1) / 2 = 2.167
The average allocation ratio for the General Factory support department is: (3 + 1.5 + 2.167) / 3 = 2.389
Allocation ratios for Power:
The allocation ratios for the Power support department are calculated in the same way, using the overhead costs and the same three allocation base ratios (machine hours, square footage, and direct labor hours).
Machine hours ratio:
Battery: 9,000 machine hours / 2,000 total machine hours = 4.5
Small Motors: 3,000 machine hours / 2,000 total machine hours = 1.5
Square footage ratio:
Battery: 10,000 square feet / (1,000 total square feet + 1,500 total square feet) = .625
Small Motors: 20,000 square feet / (1,000 total square feet + 1,500 total square feet) = 1.375
Direct labor hours ratio:
Battery: 60,000 direct labor hours / 18,000 total direct labor hours = 3.333
Small Motors: 18,000 direct labor hours /18,000 total direct labor hours= 1
The average allocation ratio for the Power support department is: (4.5 + 1.5) / 2 = 3
The allocation ratios for the Power and General Factory support departments are as follows:
Power: 3, General Factory: 2.389
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