Jason Corporation has invested in a machine that cost $76,000, that has a useful life of eight years, and that has no salvage value at the end of its useful life. The machine is being depreciated by the straight-line method, based on its useful life. It will have a payback period of ve years. Given these data, the simple rate of return on the machine is closest to: (Ignore income taxes in this problem.) (Round your answer to 1 decimal place.) 0 3.9% O 5.0% Fimbrez Corporation has provided the following data concerning an investment project that it is considering: Initial investment $240,000- Annual cash flow $133,000 Expected life of the project '- Discount rate 13% Click here to view Exhibit 113-1 and Exhibit "3-2, to determine the appropriate discount factor(s) using tables. The net present value of the project is closest to: (Round discount factor(s) to 3 decimal places, intermediate and nal answers to the nearest dollar amount.) 0 $155,542 0 $240,000 0 $i107,000) 0 $055,542) (Ignore income taxes in this problem.) The management of Cantell Corporation is considering a project that would require an initial investment of $41,000. No other cash outflows would be required. The present value of the cash inows would be $52,580. The protability index of the project is closest to: 1.28 0.72 0.28 0000 0.22 \f(Ignore income taxes in this problem.) Baldock Inc. is considering the acquisition of a new machine that costs $370,000 and has a useful life of 5 years with no salvage value. The incremental net operating income and incremental net cash ows that would be produced by the machine are: Incremental Net Incremental Net -- $94900 $175,000 $51000 $159,000 $99,000 $161,000 Assume cash ows occur uniformly throughout a year except for the initial investment. The payback period of this investment is closest to: Alesi Corporation is considering purchasing a machine that would cost $735,120 and have a useful life of 10 years. The machine would reduce cash operating costs by $102,100 per year. The machine would have a salvage value of $107,310 at the end of the project. (Ignore income taxes.) Required: a Compute the payback period for the machine. (Round your answer to 2 decimal places.) I). Compute the simple rate of return for the machine. (Round your intermediate answers to nearest whole dollar and your nal answer to 2 decimal places.) Dunay Corporation is considering investing $770,000 in a project. The life of the project would be 11 years. The project would require additional working capital of $27,000, which would be released for use elsewhere at the end of the project. The annual net cash inows would be $164,000. The salvage value of the assets used in the project would be $37,000. The company uses a discount rate of 18%. (Ignore income taxes.) Click here to view Exhibit 11 3-1 and Exhibit 11 3-2, to determine the appropriate discount factor(s) using tables. Required: Compute the net present value of the project. (Negative amount should be indicated by a minus sign. Round discount factor(s) to 3 decimal places, intermediate and final answers to the nearest dollar amount.) Management of Childers Corporation is considering whether to purchase a new model 370 machine costing $465,000 or a new model 240 machine costing $411,000 to replace a machine that was purchased 7 years ago for $431,000. The old machine was used to make product M25A until it broke down last week. Unfortunately, the old machine cannot be repaired. Management has decided to buy the new model 240 machine. It has less capacity than the new model 370 machine, but its capacity is sufcient to continue making product M25A. Management also considered, but rejected, the alternative of simply dropping product M25A. If that were done, instead of investing $411,000 in the new machine, the money could be invested in a project that would return a total of $439,000. In making the decision to buy the model 240 machine rather than the model 370 machine, the differential cost was: 0 $8,000 0 $20,000 0 $54,000 0 $34,000 Harris Corporation produces a single product. Last year, Harris manufactured 32,210 units and sold 26,700 units. Production costs for the year were as follows: Fixed manufacturing overhead $418,730 Variable manufacturing overhead $251,238 Direct labor $157,829 Direct materials $241,575 Sales were $1,241,550, for the year, variable selling and administrative expenses were $138,840, and fixed selling and administrative expenses were $199,702. There was no beginning inventory. Assume that direct labor is a variable cost. The contribution margin per unit would be: (Do not round intermediate calculations.) 0 $21.10 per unit 0 $26.30 per unit 0 $22.80 per unit 0 $16.80 per unit The manufacturing overhead budget at Cardera Corporation is based on budgeted direct labor-hours. The direct labor budget indicates that 9,600 direct labor-hours will be required in January. The variable overhead rate is $8.40 per direct labor-hour. The company's budgeted fixed manufacturing overhead is $134.400 per month, which includes depreciation of $18,150. All other fixed manufacturing overhead costs represent current cash flows. The company recomputes its predetermined overhead rate every month. The predetermined overhead rate for January should be: 0 $8.40 per direct labor-hour 0 $14.00 per direct labor-hour 0 $22.40 per direct labor-hour 0 $20.10 per direct laborhour 2i. Gilder Corporation makes a product with the following standard costs: Standard Quantity or Standard Price or Standard Cost Hours Rate Per Unit Direct materials 5.6 grams $4.00 per gram $22.40 Direct labor 1.9 hours $19.00 per hour $36.10 Variable overhead 1.9 hours $4.00 per hour $7.60 The company reported the following results concerning this product in June. Originally budgeted output 5,400 units Actual output 5,300 units Raw materials used in production 28,500 grams Purchases of raw materials 33,000 grams Actual direct labor-hours 5,700 hours Actual cost of raw materials purchases $135,300 Actual direct labor cost $113,430 Actual variable overhead cost $21,090 The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased. The materials quantity variance for June is: O $4,720U O $4,838F O $4,720F O $4,838U Sawyer Manufacturing Corporation uses a predetermined overhead rate based on direct labor-hours to apply manufacturing overhead to jobs. Last year, the Corporation worked 55,000 actual direct labor-hours and incurred $1,000,000 of actual manufacturing overhead cost. The Corporation had estimated that it would work 50,000 direct labor-hours during the year and incur $900,000 of manufacturing overhead cost. The Corporation's manufacturing overhead cost for the year was: underapplied by $90,000 underapplied by $10,000 overapplied by $90,000 overapplied by $10,000 0000 Sohc Corporation has provided the following data for the most recent month: Raw materials, beginning balance $ 10,700 Work in process, beginning balance $ 22,100 Finished goods, beginning balance $ 52,500 Tm: {1) Raw materials purchases 95 ?5,600 [2) Raw materials used in production [all direct matelials) S ?B,B00 {3) Direct labor S T2,200 [4) Manufacturing overhead costs incurred $ 82,300 {5) Manufacturing overhead applied 95 T6,300 {6)Cost of units completed and transferred from work in process to nished goods 5 234,000 {7)Any overapp-Iied or underapplied manufacturing overhead is closed to cost of goods sold ? {8) Finished goods are sold 5 266,000 Required: Prepare Tacoounts for Raw Matelials, Work in Process. Finished Goods, Manufactung Overhead, and Cost of Goods Sold. Record the beginning balances and each of the transactions listed above. Finally, determine the ending balances. Beg. Bal. Beg. Bal. End. Bal. End. Bal. Beg. Bal. Beg. Bal. End. Bal. End. Bal. Beg. Bal. End. Bal. Dace Company manufactures two products, Product F and Product G. The company cam-acts to produce and sell 2,200 units of Product F and 9,000 units of Product G during the current year. "the company um actitybesed costing to compute unit product costs for external reports. Data relating to the company's three activity cost pools are given below for the current year: MW Expected Activity ActivityCcetPecl OverheadOoala PreductF PreductG Total Machine setups 5 19,240 156 10-4 260 Purchase orders 5 34,000 700 1,300 2,000 General factory 5 40,640 1,330 1230 2,560 Required: Determine the overhead cost per unit for each product using the activityham costing approach. [Do not round your intermediate calculations. Round your nal answers to 2 decimal places.) Overhead cost per unit Rosmen, Inc., manufaomres and sells two products: Product 01 and Product Ga The companyr currently uses a planlwide predetermined overhead rate new on direct labor-hours. Data concerning the expected production of each product and the expected total direct laborhours {DLHs} required to produce that output appear below: Expected Direct TotelDi'ed Production Labor-How's Labor-Hours Per Uni Produd 01 420 10.2 3,060 Product (32 520 7.2 2,340 Total direct laborhoum 5,?00 b The direct labor rate is $25.00 per DLH. The direct materials cost per unit for each product is given below: Direct Maternah' ' Gent per Unit Product 01 $279.60 Product G2 $1?2.80 The company is cono'dering adopting an aothritybased (testing system with the following activity cost pools, activity measures, and expected activity: Activity Goat Activity trlaeeuee Overt-iced Cost Product 01 Prcdmt 62 TM Labor-related DLHs 59?,656 3,060 2.640 5.?00 Product testing Tests ?2,[IZIB TED 1.040 1,820 General factory MHs 390,000 4, 500 4,000 0,500 $559,664 Required: Calculate the difference between the unit product costs under the traditional costing method and the activity-based costing system for each of the two products. (Round your intermediate calculations and nal answers to 2 decimal places. Enter your answers as positive values.} Traditional unit product cost . ABC unit produdcost : i Dierenoe I Dybala Corporations produces and sells a slngle product. Data concernlng that product appear below: Percent of Per Unlt Sales Se Illng price $160 10096 Variable expenses 80 5995 Contribution margin 5 30 5096 The company is currently selllng 6,800 units per month. Fixed expenses are $488,800 per month. The marketing manager belleves that a $1200 Increase In the monthly advertising budget would result In a 180 unit Increase In monthly sales. What should be the overall eect on the company's monthly net operating Income of this change? 0 Decrease of $1200 0 Encrea se of $14,400 0 increase of $7,200 0 Decrease of$1200 10. Data concerning Wang Corporatlon's slngle product appear below: [Do not round your lntermedlate calculannsJ Selling price per unlt I! 20000 Varlable expense per unlt I! ?2.00 leed expense per mcmh I! 135.580 The breakeven in monthly dollar sales is closest to: 0 $212,000 0 $233320 0 $135,530 0 $42 4,000 11. A cement manufacturer has supplied the following data: Tons of cement produced and sold 320000 Sales revenue 51.024000 Vanable manufacturing expense 5241'000 leed manufactunng expense $340000 Vanable selling and administratlve expense $148,120 leed selllng and administrative expense 5102.000 Net operang Income $192,880 The company's contribution margin ratio is closest to: 43.3% 62.0% 66.8% 0000 13.8% 12. Nash Comraon manufactures and sells custom snowmobiles. From The Time an order is placed tIJI The rne the snowmobile reaches The customer averages 113 days. Th Is 113 days is spem as follows: Walt time 24 days Move time 19 days Process time 29 days Queue flme 2? days Inspectlon time 19 days What Is Nash's manufacturing cycle eiclenqr {NICE} for Its snowmoblles? [Round you answer to 1 decimal place: 40.7% 30.9% 593% 0000 55.8% 1 Answer 32.5% 2 Answer 155,542 3 Answer 1.28 4 Answer 10.32% 5 Answer 6 Payback Period 2.3 years 4.46 years Simple rate of return 22.43% 7 Net Present Value (23,052) 1 Answer 54,000 2 Answer 26.30 3 Answer $ 4 Answer $4,720F 5 Answer Underappled by $10,000 Year Inv CF PVF PVCF NPV 16.27% CF CCF Payback CF CCF Payback Year Inv CF NCF PVF PVCF NPV 22.40 per direct labor hour OH rate AH Applied Actual Oh Underapplied 6 beg. Bal. Ending Bal. beg. Bal. Ending Bal. Raw Material 10,700 78,800 75,600 7,500 Finished Goods 52,500 266,000 234,000 20,500 Cost of goods sold 266,000 272,000 6,000 272,000 272,000 7 Overhead cost per unit 8 Traditiona unit product cost ABC Unit product cost Difference Product F 30.10 Product G 9.52 Product Q1 1,536.14 1,219.91 316.23 Product G2 1,059.77 875.55 184.22 9 Answer Increase of $7,200 10 Answer 212,000 11 Answer 62.0% 12 Answer 30.9 In CM IN Adv Increase CM ratio FC BEP dollars CM ratio MC time Process time MCE 0 (240,000) 1 2 3 4 133,000 0.885 117,699 133,000 0.783 104,159 133,000 0.693 92,176 133,000 0.613 81,571 (370,000) (370,000) 2.3 (735,120) (735,120) 4.46 153,000 (217,000) 162,000 (55,000) 175,000 120,000 159,000 279,000 161,000 440,000 164,881 (570,239) 164,881 (405,358) 164,881 (240,477) 164,881 (75,596) 164,881 89,285 0 (797,000) 1 2 3 4 5 6 164,000 164,000 0.847 138,983 164,000 164,000 0.718 117,782 164,000 164,000 0.609 99,815 164,000 164,000 0.516 84,589 ### 164,000 0.437 71,686 164,000 164,000 0.370 60,751 1 (240,000) 155,605 (797,000) 1 (797,000) (23,052) SP per unit VC per unit VOH DL DM TVC CM/unit MQV= $ 46.50 7.80 4.90 7.50 20.20 26.30 (SQ-AQ)*SR 18.00 55,000 4,720 990,000 1,000,000 10,000 al beg. Bal. Ending Bal. ods Work In Process 22,100 234,000 78,800 72,200 76,300 15,400 Manufacturing Overheads 82,300 76,300 6,000 82,300 82,300 sold ACP EOHC Total A Cost/activity F Machine setups Purchase orders General Factory Totals Units OH/unit 19,240 84,000 48,640 Total OH Total DLH OH rate per DLH $ DM DL OH Product cost $ $ $ $ ACP EOHC 260 $ 2,000 $ 2,560 $ 74.00 42.00 19.00 Actvity used G 156 104 700 1,300 1,330 1,230 559,664 5,700 98.19 Q1 279.60 255.00 1,001.54 1,536.14 $ $ $ $ G2 172.80 180.00 706.97 1,059.77 Total A Cost/activity Actvity used Q1 Labor related Product Testing General Factory Totals Units OH/unit DM DL OH Product cost 14,400 7,200 7,200 64% 135,680 212,000 62.0% 94 days 29 30.9% 97,656 72,008 390,000 $ $ $ $ Q1 279.60 255.00 685.31 1,219.91 5,700 $ 1,820 $ 8,580 $ $ $ $ $ G2 172.80 180.00 522.75 875.55 17.13 39.56 45.45 G2 3,060 780 4,500 2,640 1,040 4,080 7 8 9 10 164,000 164,000 0.314 51,484 164,000 164,000 0.266 43,630 ### 164,000 0.225 36,975 164,000 164,000 0.191 31,335 11 64,000 ### 228,000 0.162 36,918 Cost allocated F G 11,544 7,696 29,400 54,600 25,270 23,370 66,214.00 85,666.00 2,200 9,000 $ 30.10 $ 9.52 Cost allocated Q1 G2 52,426 45,230 30,861 41,147 204,545 185,455 287,831.88 271,832.12 420 520 $ 685.31 $ 522.75 00000 AT&T "5*" 10:53 PM C9} '1 28% :1' connect.mheducation.com C -'-., 1. Award: 0 out of 1.42 points Jason Corporation has invested in a machine that cost $76,000, that has a useful life of eight years, and that has no salvage value at the end of its useful life. The machine is being depreciated by the straightline method, based on its useful life. It will have a payback period of five years. Given these data, the simple rate of return on the machine is closest to: (Ignore income taxes in this problem.) (Round your answer to 1 decimal place.) Explanation: Annual net cash inow\" $15,200 Annual incremental expenses: Annual depreciation ($76,000 - $0)/8 m Annual incremental net operating income $5.700 *Payback period = Investment required + Annual net cash inflow 5 years = $76,000 + Annual net cash inflow Annual net cash inflow = $76,000 + 5 years = $15,200 yearly cash flow Simple rate of return = Annual incremental net operating income + Initial investment = $5,700 + $76,000 = 7.5% Product Blog I Contact Us I Troubleshooting l Accessibili: __-4..-... .. 'v. ., Award: 1.42 out of 1.42 points Fimbrez Corporation has provided the following data concerning an investment project that it is considering: initial investment $240,000- maooo per Expected life of the project _m 13% Discount rate Click here to view Exhibit 118-1 and Exhibit 11B-2, to determine the appropriate discount factor(5) using tables. The net present value of the project is closest to: (Round discount factor(s) to 3 decimal places, intermediate and nal answers to the nearest dollar amount.) 0 . $155,542 0 $240,000 0 $001000) 0 551155.542) Explanation: Year _-:-- _____ _____ _ $133900 = _ Total cash flow (e) 311240000) $133,000 $133,000 $133,000 $133,000 Discounlfactor{13%l(b) 0.885 0.733 0.693 0.513 Present value of cash ows (a) x (bi $[240.000) $117705 $104,139 $92,159 $81,529 $155542 Award: 0 out of 1.42 points (Ignore income taxes in this problem) The management of Cantell Corporation is considering a project that would require an initial investment of $41,000. No other cash outflows would be required. The present value of the cash inows would be $52,580. The protability index of the project is closest to: Explanation: Investment required {a} I ${41.000] Present value of cash inflows 52,580 Net present value (b) $11,580 Project protability index (b) + (a) _ Award: 1.42 out of 1.42 palms {Ignore income taxes in this problem.) Baidock Inc Is considering the acquisition of a new machine that costs $3?0,000 and has a useful lite of 5 years with no saivage value. The incremental net operating income and incremental net cash flows that would be produced by the machine are: Year 5 $99,000 $161,000 Assume cash flows occur uniformly throughout a year except for the initial investment. The payback period of this investment is closest to: O 3.5 years 0 5.0 years 0 4.7 years a . 2.3 years Explanation: Uncovered _ Investment Cash Inow Investment _ $370,000 $153 000 $217,000 $162 000 $55,000 $175,000 al 059.000 _ . 061.000 Year 3: $55,000 + $175,000 = 0.3 (rounded) Payback = 2.3 years ( Question 6 (01' T) V ) Alesi Corporation is considering purchasing a machine that would cost $735,120 and have a useful life of 10 years. The machine would reduce cash operating costs by $102,100 per year. The machine would have a salvage value of $107,310 at the end of the project. (Ignore income taxes.) Required: Compute the payback period for the machine. (Round your an. answer to 2 decimal places.) "' Compute the simple rate of return for the machine. (Round your intermediate answers to nearest whole dollar and your final answer to 2 decimal places.)