Cortez Company is planning to introduce a new product that will sell for $108 a unit. The following manufacturing cost estimates have been made on 20,000 units to be produced the first year; Manufacturing overhead costs have not yet been estimated for the new product, but monthly date on total production and overhead costs for the post 24 months have been analyzed using simple linear regression. The following results were derive from the simple regression and provide the basis for overhead cost estimates for the new product. What percentage of the variation in overhead costs is explained by the independent variable? 82.8% 91.1% 99.4% 74.5% None of the above. What is the total overhead cost for an estimated activity level of 60,000 direct labor-hours? $410,000.
$420,000.
$400,000.
$430,000.
Answers
Question: What percentage of the variation in overhead costs is explained by the independent variable
Answer: 82.8%
Explanation:
= 0.848 (84.8%), the explanation of variation in Y from the X regress
Question: What is the total overhead cost for an estimated activity level of 60,000 direct labor-hours
Answer: $410,000
Explanation:
The equation resulting from this regression analysis is:
Total overhead = Estimated fixed cost + Estimated variable cost per labor hour x Labor hours
= Intercept estimate + Coefficient estimate on independent variable x 60,000 DLH
= 110000 + 5 x 60000 DLH
= 110000 + 300000
= 410000
Here is the full question with the appropriate tables.
Cortez Company is planning to introduce a new product that will sell for $108 a unit. The following manufacturing cost estimates have been made on 20,000 units to be produced the first year;
Direct Materials $700,000
Direct Labor $720,000 (= $18 per hour × 40,000 hours)
Manufacturing overhead costs have not yet been estimated for the new product, but monthly date on total production and overhead costs for the post 24 months have been analyzed using simple linear regression. The following results were derive from the simple regression and provide the basis for overhead cost estimates for the new product.
Simple Regression Analysis Results.
Dependent variable-Factory overhead cost-Independent Variable-Direct labor hours Computed values
Intercept $ 120,0000
Coefficient on independent variable $ 5.00
Coefficient of correlation .920
R² .828
What percentage of the variation in overhead costs is explained by the independent variable? 82.8% 91.1% 99.4% 74.5% None of the above.
What is the total overhead cost for an estimated activity level of 60,000 direct labor-hours?
$410,000.
$420,000.
$400,000.
$430,000.
Answer:
R² = 82.8%
$420,000
Explanation:
Given that:
R² = .828
The percentage of the variation in overhead costs explained by the independent variable in Y from the X regressor = %
= 82.8%
Given that:
direct labor-hours = 60,000
To calculate the Total overhead cost; we have:
(Total overhead) to be = Estimated fixed cost + estimated variable cost per
labor hour × labor-hours
= Intercept estimate + Coefficient estimate on
independent variable × 60,000 direct labor-hours
= $120,000 + ($5 × 60,000) direct labor-hours
= $120,000 + $300,000
= $420,000
∴ the total overhead cost for an estimated activity level of 60,000 direct labor-hours = $420,000.
Related Questions
Pelican, Inc. had revenues of $395,000, expenses of $155,000, and dividends of $54,000 during the current year. Based on the given information, which of the following statements is true?a. Net income for the current year totaled $186,000. b. Total retained earnings decreased by $186,000 during the current year. c. Total retained earnings increased by $240,000 during the current year. d. Net income for the current year totaled $240,000
What role should government play in a free market economy?
The following data are taken from the financial statements of Marigold Company: 2022 2021 Average accounts receivable $539,000 $577,000 Net sales on account 5,605,600 5,308,400 Terms for all sales are 2/10, n/30. Compute for each year the accounts receivable turnover, accounts receivable was $572,000.
The Organization for the Promotion of Brussels Sprouts has convinced the government of Ironia to institute a price floor on the sale of Brussels sprouts, at $8 per bushel. Demand is given by:P = 9 – Qand supply by:P = 2Q,where Q is measured in thousands of bushels.(a) At market equilibrium, the price is $________ per bushel, and the equilibrium quantity is_______ thousand bushels.(b) With the price floor, the price is $_________ per bushel, and the quantity sold is________ thousand bushels.
to quit. Fidelity gives Ron a week to decide whether to
accept. Two days later, Monica signs an employment
contract with Fidelity for another year. The next day,
Monica tells Ron of the new contract. Ron immediately
sends a formal letter of acceptance to Fidelity. Do Fidel-
ity and Ron have a contract? Why or why not? (See Ter-
mination of the Offer.)
Answers
Final answer:
Ron and Fidelity do not have a contract because the initial offer from Fidelity was terminated when Monica decided to stay. Hence, when Ron accepted, there was no standing offer for a contract.
Explanation:
No, Fidelity and Ron do not have a contract. The reason behind this is the concept of offer and acceptance in contract law. In this scenario, Fidelity Corporation’s offer was terminated when Monica decided to stay, making the earlier offer to Ron void since an employment position no longer existed.
When, Monica signed a new contract, Fidelity Corporation's offer to Ron was effectively withdrawn before Ron could accept it. Therefore, when Ron sent a formal letter of acceptance to Fidelity, there was no offer to accept, making the creation of a contract impossible.
The crux of the situation lies in the basic principles of contract formation, which dictate that a valid contract requires an offer, acceptance, and consideration. In this case, the essential element of offer was missing when Ron attempted to accept, thus, barring the formation of a valid contract.
Learn more about Contract Law here:
#SPJ2
B. not be covering their total fixed costs.
C. not be covering their total variable costs.
D. a and b b and c
Answers
In long-run competitive equilibrium SRATC = LRATC, because if SRATC > LRATC (at the quantity of output at which MR = MC) firms would have an incentive to change their plant size to produce their current output.
Option: A
Explanation:
In perfect competition, balance is the stage where consumer demands are equal to market supply. In the short term demand can impact stability. In the long run both a product's demand and supply would influence the balance in perfect competition.
The increase in the quantity of output generated is the SRTC i.e short-run total cost and LRTC i.e long-run total cost scales because generating more output needs more labor utilization for both the short and long runs, and since, in the long run, generating more output implies using more of the physical resource supply; and by using more of either supply means incurring more production costs.
Answers
Answer:
True.
Explanation:
The cable company will not have any incentive to cut costs. This is because it knows that its costs will be averaged to determine the average cost to which a certain percentage is then added to arrive at the selling price. Having the cost averaged in this way will not motivate the cable company to seek cost minimization strategies that it could use to increase its income.
Final answer:
The statement is false. Under the average-cost pricing policy, the cable company has the incentive to cut costs to potentially lower prices and increase market share.
Explanation:
False, under the average-cost pricing policy, the cable company does have incentives to cut costs. The average-cost pricing policy allows the firm to set the price equal to the average cost of production. If the cable company can lower its cost of production, it will be able to lower the price it charges, which could potentially increase its market share and profits. Consider an example where economies of scale come into play: if each firm produced at a higher average cost due to building their own power lines, they would raise prices to cover this cost. However, if a firm found a way to reduce the cost of power lines or production in general, they could lower their prices in comparison to other firms. This demonstrates the incentive for cost-cutting under average-cost pricing.
Learn more about average-cost pricing policy here:
#SPJ3
B. Transfer the knowledge of touchscreen capabilities and the Apple ecosystem from Apple to the TV manufacturer to use for the new Apple Smart TV
Answers
Answer:
B. Transfer the knowledge of touchscreen capabilities and the Apple ecosystem from Apple to the TV manufacturer to use for the new Apple Smart TV
Explanation:
In the first case, Apple doesn't have technical expertise on manfucturing the TV. Here the differences in both the devies with respect to the technology that applied in ports, operating system tec
So here the technology that adapted would be difficult for implementation
Instead of this, the apple would create the better position.
So, the option b is correct
Hence, the option a is incorrect
Final answer:
Apple would most benefit by transferring its knowledge of touchscreen capabilities and its ecosystem to the TV manufacturer for the new Apple Smart TV. This strategy leverages Apple's core competencies and shares them with the newly integrated TV manufacturer, enabling the creation of smart TVs that are as intuitive and user-friendly as Apple's other products.
Explanation:
To successfully integrate a TV manufacturer into its own company, Apple would most benefit from the scenario outlined in option B: Transfer the knowledge of touchscreen capabilities and the Apple ecosystem from Apple to the TV manufacturer to use for the new Apple Smart TV.
This strategy aligns with the concept of core competencies, which are the unique strengths and abilities that a corporation possesses. Apple is renowned for its touchscreen technology and unique ecosystem of interconnected products and services, which are two of its core competencies.
By transferring these to the TV manufacturer, Apple can leverage its existing advantages in the new smart TV market, ensuring that its smart TV products are as intuitive and user-friendly as its other offerings. Thus, more than integrating the TV manufacturer fully into its current computer business, what brings greater value and synergy to Apple is the use of its inherent strengths to lead the new venture into success.
Learn more about Business Strategy here:
#SPJ12
Answers
"There are fewer close substitutes for the product your team supports" will improve your bargaining position with customers.
Option: B
Explanation:
Bargaining is the procedure which is preferred by citizens not only with street shops but it is famous internationally too, where defense, economic trade deal, etc are signed between two different nations to corporate and shake hand of unity. Bargaining is more effective when one allow seller to know that the party itself have more substitutes if the product is not provided by the seller in appropriate rate.
For an instance, if India need to buy some rolling defense helicopters for nation from Russia but prices are high and United States is providing same material with lower price or may be with better rewards on buying from them.
a) Chart of accounts
Universal Garage
Chart of Accounts
100 ASSETS
110 CURRENT ASSETS
111 Cash
112 Accounts Receivable
114 Supplies
116 Prepaid Rent
117 Prepaid Insurance
120 PLANT ASSETS
121 Land
123 Machinery
123.1 Accumulated Depreciation-Machinery
125 Office Equipment
0.1 Accumulated Depreciation-Office Equipment
200 LIABILITIES
210 CURRENT LIABILITIES
211 Account Payable
213 Salaries Payable
216 Interest Payable
220 NON-CURRENT LIABILITIES
221 Long-term Bank Loan
300 OWNER'S EQUITY
301 Tahir, Capital
302 Tahir, Drawings
303 Incomes Summary
400 REVENUES
401 Fees Earned
410 Other Income
500 EXPENSES
501 Salary Expenses
502 Supplies Expenses
503 Rent Expenses
504 Insurance Expenses
505 Depreciation Expenses
506 Interest Expenses
510 Miscellaneous Expenses
b) Transactions
Mar 1 Received the following assets from its owner, Tahir:
Cash....................................... Br, 8,300
Supplies ................................. 2,000
Office Equipment................... 10,000
2 Borrowed Br 5,000 from Dashen Bank
3 Paid Br 1,800 for rent on a building leased for business purposes
3 Purchased welding and other repair machinery for Br 3,600 cash
4 Paid Br 200 for a radio advertisement
8 Sold for Br 200 cash an old office equipment with a recorded cost of Br 200
13 Paid weekly salary Br 1,200
16 Received Br 4,400 from services rendered on cash
20 Paid weekly salary Br 1,200
20 Received Br500 royalties for idle repair machinery it leased to other businesses
20 Delivered service on credit, Br 6,000
21 Purchased additional repair machinery on account for Br 2,000 from Sámi-Engineers
23 Received Br 5,000 additional cash investment from its owner
24 Repaid Br 1,000 bank loan and paid Br 100 interest on bank loan
26 Purchased supplies for Br 800 cash
27 Paid Br 100 for customer entertainment and other items
27 Paid weekly salary Br 1,200
31 Paid Br 500 for electricity and other utilities consumed during the month
31 Received Br 4,200 cash from credit customers
31 Paid Tahir Br 1,800 for personal uses
Required:
a) Journalize the above transactions in a two-column journal
b) Post the journal entries to “T” accounts
c) Prepare and complete a worksheet based on the following additional information
i. Cost of supplies remained unconsumed on Mar 31 is Br 900
ii. The amount paid on Mar 3 is for a three-month rent
iii. The amounts of depreciation for machinery and office equipment are estimated to be Br 560 and Br 1,900 respectively
iv. Universal Garage usually pays Br 1,200 for employee's salary every saturday for a six-day work week ended on that day
v. Interest on bank loan accrued but not paid on March 31 total Br 100
d) Prepare financial statements for the month
e) Journalize and post adjusting entries
f) Journalize and post closing entries
g) Prepare post-closing trial balance
Answers
Answer:
bla boa black sheep have u any wool no sir no sir