The operating income calculated using variable costing and absorption costing amounts to $9,100 and $11,200. There were no beginning inventories. Determine the total fixed manufacturing overhead that will be expensed under absorption costing for the year.

Answers

Answer 1

Answer:

$2,100

Explanation:

The difference between variable costing income and absorption costing income arises due to fixed cost deferred in inventory. This is the  total fixed manufacturing overhead that will be expensed under absorption costing.

Calculation :

Fixed Cost in Inventory = $11,200 - $9,100

                                       = $2,100


Related Questions

The following data were accumulated for use in reconciling the bank account of Creative Design Co. for August 20Y6:
1. Cash balance according to the company’s records at August 31, $24,270.2. Cash balance according to the bank statement at August 31, $32,278.3. Checks outstanding, $14,668.4. Deposit in transit, not recorded by bank, $7,170.5. A check for $58 in payment of an account was erroneously recorded in the check register as $580.6. Bank debit memo for service charges, $12.A. Prepare a bank reconciliation, using the format shown in
B. If the balance sheet were prepared for Creative Design Co. on August 31 what amount should be reported for cash?
C. Must a bank reconciliation always balance (reconcile)
A) NoB) Yes.
Amount DescriptionsAdjusted balanceBank service chargeBank error in charging check as $58 instead of $580Bank error in charging check as $580 instead of $58Deposit in transit, not recorded by bankError in recording check as $58 instead of $580Error in recording check as $580 instead of $58Outstanding checksTotal adjustments

Answers

Answer:

Creative Design Co.

A. Bank Reconciliation Statement as of August 31:

Balance as per bank statement       $32,278

Deposit in transit,                                 $7,170

Checks outstanding,                        ($14,668)

Balance as per adjusted cash bal.   $24,780

B. The amount that should be reported for cash is $32,278.

C. B) Yes. A bank reconciliation must always balance (reconcile), otherwise, the purpose of the reconciliation is defeated.

Explanation:

a) Data and Calculations:

1. Cash balance according to the company’s records at August 31, $24,270.

2. Cash balance according to the bank statement at August 31, $32,278

3. Checks outstanding, $14,668

4. Deposit in transit, not recorded by bank, $7,170

5. A check for $58 in payment of an account was erroneously recorded in the check register as $580.

6. Bank debit memo for service charges, $12

Cash Book Adjustment:

August 31 balance           $24,270

add overstatement of check 522

less bank charges                    12

Adjusted balance           $24,780

At the beginning of the year, Crane Company estimates annual overhead costs to be $2400000 and that 400000 machine hours will be operated. Using machine hours as a base, the amount of overhead applied during the year if actual machine hours for the year was 375000 hours is

Answers

Answer:

the amount of overhead applied during the year is $2,250,000

Explanation:

The computation of the overhead applied is shown below;

= Estimated annual overhead ÷ machine hours × actual machine hours

= $2,400,000 ÷ 400,000 machine hours × 375,000 hours

= $2,250,000

hence, the amount of overhead applied during the year is $2,250,000

Wolfe Company had the following beginning inventory and purchases during 2018 Date Transaction Number of units Unit Cost 1/1 Beginning inventory 2,000 $22.00 4/12 Purchase No. 1 2,300 $26.00 7/11 Purchase No. 2 800 $28.00 10/5 Purchase No. 3 1,250 $30.00 Wolfe sold 4,100 units Determine the amount of ending inventory and cost of goods sold using the following methods: Method Ending inventory Cost of Goods Sold LIFO FIFO Weighted average

Answers

Answer:

Wolfe Company

The amount of:

                                      LIFO         FIFO    Weighted Average

Ending inventory      $50,500    $65,100        $58,005

Cost of goods sold  $113,200   $98,600       $105,698

Explanation:

a) Data and Calculations:

Date Transaction             Number of units   Unit Cost   Cost Value

1/1     Beginning inventory             2,000        $22.00    $44,000

4/12  Purchase No. 1                      2,300        $26.00      59,800

7/11   Purchase No. 2                        800        $28.00      22,400

10/5 Purchase No. 3                      1,250        $30.00      37,500

Total inventory available              6,350                       $163,700

Wolfe sold                                      4,100

Ending Inventory                          2,250

LIFO

Ending Inventory = $50,500 (250 * $26 + 2,000 * $22)

Cost of goods sold:

4/12  Purchase No. 1                      2,050        $26.00      53,300

7/11   Purchase No. 2                        800        $28.00      22,400

10/5 Purchase No. 3                      1,250        $30.00      37,500

Total cost of goods sold =            4,100                        $113,200

FIFO:

Ending Inventory = Cost of goods available for sale - Cost of goods sold

= $65,100 ($163,700 - $98,600)

Cost of goods sold:

1/1     Beginning inventory             2,000        $22.00    $44,000

4/12  Purchase No. 1                      2,100        $26.00        54,600

Total cost of goods sold = $98,600

Weighted average:

Weighted average cost = $25.78 ($163,700/6,350)

Ending inventory = $58,005 (2,250 * $25.78)

Cost of goods sold = $105,698 (4,100 * $25.78)

Anthony Walker plans to invest $28,400 a year at the end of each year for the next seven years in an investment that will pay him a rate of return of 9.8 percent. How much money will Anthony have at the end of seven years

Answers

Answer:

267,785.95

Explanation:

28400 X (1.098)^7 = 267,785.95

The price elasticity of demand measures: Group of answer choices how responsive consumers are in the quantity they want when consumer incomes change how responsive producers are in the quantity they produce when the price changes how responsive consumers are in the quantity they want when the price changes how responsive producers are in the quantity they produce when consumer incomes change

Answers

Answer:

how responsive consumers are in the quantity they want when the price changes

Explanation:

The price elasticity of demand is

= Percentage change in quantity demanded ÷ percentage change in demand

So based on the above formula it shows that the consumers are responsive with regard to the quantity they need at the time when the price is changed

Therefore the above represent the answer

Answer:

Price

Inelastic

Elastic

Explanation:

got it right on edg

Scenario 34-1. Take the following information as given for a small, imaginary economy: When income is $10,000, consumption spending is $6,500. When income is $11,000, consumption spending is $7,250. Refer to Scenario 34-1. The marginal propensity to consume (MPC) for this economy is

Answers

Answer:

0.75

Explanation:

Marginal Propensity to Consume (MPC) is the change in consumption due to change in income

Change in consumption = $7,250 - $6,500 = $750

Change in income = $11,000 - $10,000 = $1,000

MPC = Change in consumption / Change in income

MPC = 750 / 100

MPC = 0.75

The Sneed Corporation issues 10,000 shares of $50 par preferred stock for cash at $75 per share. The entry to record the transaction will consist of a debit to Cash for $750,000 and a credit or credits to a.Paid-In Capital from Preferred Stock for $750,000 b.Preferred Stock for $500,000 and Retained Earnings for $250,000 c.Preferred Stock for $500,000 and Paid-In Capital in Excess of Par—Preferred Stock for $250,000 d.Preferred Stock for $750,000

Answers

Answer:

b) Preferred Stock for $500,000.00 and Paid-In Capital in Excess of Par-Preferred Stock for $250,000.00

Explanation:

Based on the information given The Appropriate journal entry to record the transaction will consist of a debit to Cash for $750,000 and a credit or credits to PREFERRED STOCK FOR $500,000.00 and PAID-IN CAPITAL IN EXCESS OF PAR-PREFERRED STOCK FOR $250,000.00

Dr Cash $750,000

(10,000 shares *$75)

Cr Preferred Stock for $500,000.00

(10,000 shares *$50)

Cr Paid-In Capital in Excess of Par-Preferred Stock for $250,000.00

($750,000-$500,000]

Suppose that the U.S. government decides to charge wine producers a tax. Before the tax, 40 billion bottles of wine were sold every year at a price of $7 per bottle. After the tax, 35 billion bottles of wine are sold every year; consumers pay $9 per bottle, and producers receive $6 per bottle (after paying the tax). The amount of the tax on a bottle of wine isper bottle. Of this amount, the burden that falls on consumers isper bottle, and the burden that falls on producers isper bottle. True or False: The effect of the tax on the quantity sold would have been larger if the tax had been levied on consumers.

Answers

Answer and Explanation:

The computation is shown below:

The amount of the tax for the wine bottle is

= $9 per bottle - $6 per bottle

= $3 per bottle

Before the tax, the price per bottle is $7 per bottle

The Tax burden on consumers is

= $9 - $7

= $2 per bottle

And, the tax burden on producers is

= $7 per bottle - $6 per bottle

= $1 per bottle

So, the given statement is false as the impact would remain the same whether it is for producer or consumer

Acme Air Compressor Company has decided to limit the number of compressors it will supply to some of its distributors that it suspects are selling a line of compressors made by one of its competitors. Acme is using its referent power in its distribution channel.

a. True
b. False

Answers

Answer:

b. False

Explanation:

A Referent power in an organization my be defined as the power of a person or a company that is based on high level of identification with that of admiration or inspiration or out of respect.

Thus in the context, the Acme company does not uses its referent power to its distribution channel when the company decides to limit the supply of the its compressors to some of its distributors as the distributors are selling some of the air compressors of the competitor company.

Hence the answer is FALSE.

Nike has so far had $30,000,000 in losses at its shoe factory in Vietnam in 2017. The additional revenue that it will earn from producing an additional shoe is $100 while the additional cots incurred for that additional shoe is $99.99. Should Nike continue operations in that factory and produce that additional shoe

Answers

Answer: c. Yes, because the marginal revenue from producing the additional shoe is greater than the marginal costs.

Explanation:

When making financial decisions, companies abide by the principle of Sunk Costs. This means that money that has already been spent, should not have any effect on future financial decisions. The $30 million that has been lost already will therefore not be considered.

The only figures now are the additional cost and revenue. The additional revenue is more than the additional cost so this shoe should be produced because it brings in a profit of $0.01.

Novak Financial Services performs bookkeeping and tax-reporting services to startup companies in the Oconomowoc area. On January 1, 2020, Novak entered into a 3-year service contract with Walleye Tech. Walleye promises to pay $10,900 at the beginning of each year, which at contract inception is the standalone selling price for these services. At the end of the second year, the contract is modified and the fee for the third year of services is reduced to $8,700. In addition, Walleye agrees to pay an additional $21,800 at the beginning of the third year to cover the contract for 3 additional years (i.e., 4 years remain after the modification). The extended contract services are similar to those provided in the first 2 years of the contract.

Required:
a. Prepare the journal entries for Tyler in 2019 and 2020 related to this service contract.
b. Prepare the journal entries for Tyler in 2020 related to the modified service contract, assuming a prospective approach.
c. Repeat the requirements for part (b), assuming Tyler and Walleye agree on a revised set of services (fewer bookkeeping services but more tax services) in the extended contract period and the modification results in a separate performance obligation

Answers

Answer: See explanation

Explanation:

a. 1 jan 2020

Debit Cash $10,900

Credit Unearned revenue $10,900

31st dec 2020

Debit Unearned revenue $10,900

Credit Service revenue $10,900

1 jan 2020

Debit Cash $10,900

Credit Unearned revenue $10,900

31st dec 2020

Debit Unearned revenue $10,900

Credit Service revenue $10,900

b. 1 Jan 2021

Debit Cash $30500

Credit Unearned revenue $30500

31st dec 2020

Debit Unearned revenue $7,625

Credit Service revenue $7,625 ($30500/4)

c. 1 Jan 2020

Debit Cash $30500

Credit Unearned revenue $30500

31st Dec 2020

Debit Unearned revenue $8,700

Credit Service revenue $8,700

The reporting of net cash provided or used by operating activities that lists the major items of operating cash receipts, such as receipts from customers, and subtracts the major items of operating cash disbursements, such as cash paid for merchandise, is referred to as the:

Answers

Direct method

Explanation:

A cost-cutting project will decrease costs by $66,100 a year. The annual depreciation will be $15,750 and the tax rate is 35 percent. What is the operating cash flow for this project?

Answers

Answer:

$48,478

Explanation:

Calculation to determine What is the operating cash flow for this project

Operating cash flow = [$66,100 ×(1 -.35)] + [$15,750 ×.35]

Operating cash flow = [$66,100 ×.65)+5,513.

Operating cash flow = 42,965+5,513

Operating cash flow = $48,478

Therefore the operating cash flow for this project will be $48,478

The manager of Quick Car Inspection reviewed the monthly operating costs for the past year. The costs ranged from $4,400 for 1,400 inspections to $4,200 for 1,000 inspections. Please use the high-low method to calculate the variable cost per inspection.

Answers

Answer:

Variable cost per unit= $0.5 per inspection

Explanation:

Giving the following information:

The costs ranged from $4,400 for 1,400 inspections to $4,200 for 1,000 inspections.

To calculate the variable cost under the high-low method, we need to use the following formula:

Variable cost per unit= (Highest activity cost - Lowest activity cost)/ (Highest activity units - Lowest activity units)

Variable cost per unit= (4,400 - 4,200) / (1,400 - 1,000)

Variable cost per unit= $0.5 per inspection

In a continuous review inventory​ system, the lead time for door knobs is weeks. The standard deviation of demand during the lead time is units. The desired​ cycle-service level is percent. The supplier of door knobs streamlined its operations and now quotes a 1 week lead time. Refer to the standard normal tableLOADING... for​ z-values. How much can the safety stock be reduced without reducing the percent​ cycle-service level? The safety stock can be reduced by nothing door knobs. ​(Enter your response rounded to the nearest whole​ number.)

Answers

Answer:

The answer is "116 doorknobs".

Explanation:

The standard deviation of the demand before the (four weeks) protection intervals = [tex]\sigma-d \times (\sqrt{L}) = 100 \ units\\[/tex]

The desired cycle service level is [tex]99\%[/tex].Therefore, [tex]z = 2.33[/tex]

The safety stocks for the four-weeks protecting interval are:

Safety stock [tex]= z\times [ \sigma-d \times (\sqrt{L})][/tex]

                     [tex]= 2.33 \times 100 \\\\= 233\ door\ knobs[/tex]

The safety stocks require for the one-week protection interval are: [tex]\sigma-dLT = \sigma-dt \times (\sqrt{L}) = \sigma-dt \times (\sqrt{4}) = 100\ door\ knobs\\\\\sigma-d = \frac{100}{(\sqrt{4})} = \frac{100}{2} = 50 \ door\ knobs\\\\[/tex]

Safety stock [tex]= z\times \sigma-dt = 2.33 \times 50 = 116.5 \ or\ 117 \ door\ knobs\\\\[/tex]

Safety stock reduction[tex]= 233 -117 = 116 \ door\ knobs[/tex]

________ is the process of coordinating all messages, media and activities used by an organization to communicate with the market across different communication methods

Answers

Answer:

integrated Marketing communication

Explanation:

This method is used by firms and companies to brand their communications and also in their coordination. It makes sure that all the various forms of communications are well linked together. This would create a unified communication channel for the consumer during their interactions with the enterprise. the aspects it integrates includes, advertising, public relations, social media and promotion of sales.

Finisher Inc. sells merchandise of $250,000 in 2020 that includes a three-year limited warranty. Warranty costs are estimated to be 1% of sales. The company incurred actual costs of $800 in 2020 related to the warranties. a. Record the warranty accrual at the time of sale in 2020. b. Record the adjustment to the warranty accrual for actual warranty costs in 2020.

Answers

Answer: See explanation

Explanation:

a. Record the warranty accrual at the time of sale in 2020.

Debit Warranty expense = $250,000 × 1% = $2,500

Credit Warranty Liability $2,500

(To record the warranty accrual)

b. Record the adjustment to the warranty accrual for actual warranty costs in 2020.

Debit Warranty Liability $800

Credit Cash and Payables $800

Test Tech has preferred stock outstanding that pays an $10.85 annual dividend. It price is $125. What is the required rate of return on the preferred stock

Answers

Answer:

8.7%

Explanation:

Calculation to determine the required rate of return on the preferred stock

Using this formula

Required rate of return=Annual dividend/Price

Let plug in the formula

Required rate of return=$10.85/$125

Required rate of return=0.087*100

Required rate of return=8.7%

Therefore the required rate of return on the preferred stock is 8.7%

The net asset value of shares in a closed-end investment company is $36. An investor buys the shares for $34 in the secondary market. The company distributes $1 and after one year, the net asset rises to $42. The investor sells the shares for $43 in the secondary market. What is the percentage return on the investment

Answers

Answer:

Closed-End Investment Company

The percentage return on the investment is:

= = 29.41%

Explanation:

a) Data and Calculations:

Net asset value of share = $36

Price paid by an investor = $34

Dividend distributed = $1

Net asset value after one year = $42

Selling price in the secondary market by the investor = $43

Total amount realized by the investor = $44 ($43 + $1)

Cost of investment = $34

Dollar return on the investment = $10 ($44 - $34)

Percentage return on the investment = Return on investment/Cost of investment * 100

= $10/$34 * 100

= 29.41%

Winston Company reported net income of $50,000 for the year. During the year, accounts receivable decreased by $7,000, accounts payable increased by $3,000 and depreciation expense of $5,000 was recorded. Net cash provided by operating activities for the year is Group of answer choices $40,000. $65,000. $49,000. $45,000.

Answers

Answer:

$65000

Explanation:

Below is the calculation:

To find the net cash from the operating activity, we are required to add depreciation, accounts payable and accounts receivables.

Net income of the company = $50000

Add- expenses of depreciation = 5000

Add - Increase in accounts payable = 3000

Add - Decrease in accounts receivable = $7000

Thus net cash from operating activity =  50000 + 5000 + 3000 + 7000 = $65000

Which of the following statements about striving to reduce labor costs per pair produced at each of the company's plants is true?

a. A company cannot achieve labor costs per pair produced that are close to the lowest in the industry (in those geographic regions where it has plants) unless its annual total compensation of plant workers is below the average annual total compensation paid by all companies with plants in these same regions.

b. All companies, regardless of the strategy being employed, should pursue actions to manage employee compensation and labor productivity in a manner that results in labor costs per pair produced that are equal to (or very close to) the industry-low in each region where the company has plants.

c. It is very difficult for a company producing branded footwear with a high S/Q rating to achieve labor costs per pair produced that are below the industry average in each geographic region where the company has plants.
d. A company pursuing a low-cost provider strategy is better able to pursue actions aimed at achieving low labor costs per pair produced in each of its plants (as compared to the labor costs of companies with plants in the same regions) than is a company pursuing a differentiation strategy.
e. It is more cost effective for a company to compensate plant workers at levels that are close to the highest in the industry in each geographic region where it has plants than it is for a company to pursue actions to keep labor costs per pair produced below the industry average in each geographic region where it has plants.

Answers

Answer:

b. All companies, regardless of the strategy being employed, should pursue actions to manage employee compensation and labor productivity in a manner that results in labor costs per pair produced that are equal to (or very close to) the industry-low in each region where the company has plants.

Explanation:

The less labor cost of production per pair could be attained in following two ways

1. The productivity level is icnreased

2. The compensation should be managed and it provides the combination of both fixed and variable. Also it pays the high compensation but at the more productivity rate due to which the labor cost per pair would fall

So as per the given situation, the option b is correct

You are an investment manager and one of your clients is a famous soccer player. She is promised to be paid $5million three years from now. What is the present value of this cash flow today

Answers

Answer:

$4,153,268.86

Explanation:

The below is missing from the question:

Your discount rate for real cash flows is 5% APR, compounded monthly and you are expecting inflation of 1.2% per year (APR, annual compounding).

We need to convert the real interest rate to an effective annual rate as shown thus:

EAR=(1+APR/n)^n-1

APR=5%

number of times interest is compounded annually=12

EAR=(1+5%/12)^12-1

EAR=5.12%

Nominal Discount rate = [(1+ Real Discount rate)*(1+Inflation Rate)] - 1

Nominal Discount rate =(1+5.12%)*(1+1.2%)-1

Nominal discount rate=6.38%

Present value=future value/(1+nominal discount rate)^3

future value=$5,000,0000

nominal discount rate=6.38%

n=3 years

PV=$5,000,000/(1+6.38%)^3

PV= $4,153,268.86  

A certain machine will have a cost of $25,000 (then $) six years from now. Find the PW of the machine if the real interest rate is 10% per year and the inflation rate is 5% per year using (a) constant-value dollars, and (b) then-current dollars.

Answers

Answer:

The Present Worth of the machine if the real interest rate is 10% per year and the inflation rate is 5% per year, using:

(a) constant-value dollars

= $10,518.60

(b) then-current dollars

= $10,818.65

Explanation:

a) Data and Calculations:

Cost a certain machine six years from now = $25,000

Time period = 6 years

Real interest rate = 10%

Inflation rate = 5%

Nominal interest rate = 5% (10% - 5%)

Discount factor at 10% for 6 years = 0.564

Discount factor at 5% for 6 years = 0.746

PW using:

a) Constant-value dollars = $18,650 ($25,000 * 0.746)

PW = $10,518.60 ($18,650 * 0.564)

b) Then-current dollars:

The nominal rate = 0.1 + 0.05 + (0.1 * 0.05) = 0.155

$10,818.65 ($25,000 * 0.432746)

There are several attempts to explain Marvels Success via competetive strategy but they fall flat: competitve strategy, with this specific case neither predicts nor explains the outcome why?

Answers

Answer:

It has been a well known fact that competitive strategy creates a unique value for a target set of movie customers. However, it is not able to predict nor explain the outcome due to the fact that Marvel only focused on trying to compete to be the best in comic and superhero films which thus resulted in basically a case whereby there was a competition in which one participant wins totally and another loses without gaining any objectives and thus they were not able to win.

Explanation:

This question is taken from a book titled "The Marvel Way: Restoring a Blue Ocean". It was written by W. Chan Kim, Renee Mauborgne, Michael Olenick. The central theme of the book was about one of the greatest turnarounds in modern business history by the then Marvel CEO with the name Peter Cuneo who was responsible for turning the business around and succeeded in launching a blue ocean.

From the question, neither predicts nor explains the outcome because;

It has been a well known fact that competitive strategy creates a unique value for a target set of movie customers. However, it is not able to predict nor explain the outcome due to the fact that Marvel only focused on trying to compete to be the best in comic and superhero films which thus resulted in basically a case whereby there was a competition in which one participant wins totally and another loses without gaining any objectives and thus they were not able to win.

In (Noon) Company, direct materials are added at the beginning of the production process. Conversion costs are incurred evenly throughout the production process. Before inspection, some units are spoiled due to undetectable materials defects. Inspection occurs when units are 60% converted. Spoiled units generally constitute 6% of the good units. Data for December 2019 are as follows: WIP, beginning inventory 12/1/2019 Direct materials 22,500 units (100% complete) Conversion costs (55% complete) Started during December 76,700 units Completed and transferred out 12/31/2019 72,500 units WIP, ending inventory 12/31/2019 18,400 units Direct materials (100% complete) Conversion costs (65% complete) What is the number of normal spoilage units?​

Answers

Answer:

Following are the responses to the given question:

Explanation:

Statement In December the computation of typical spoiling units shall be shown:

Particulars                                   Units

WIP Inventory Start on 12 January 2019      22,500

Departments began in December             76,700

Total stock available for both the month     99,200

Less: transferred units on 31 December 2019       72,500

Inventory of Less: WIP on 31 December 2019        18,400

Inventory of Balance (Normal Spoilage units)        8,300

I’ll give 20 points to the best answer !!!

Answers

Answer:

The answer is "Slide Master View"

Explanation:

Slide Master Look is indeed the name of this feature. This can help you keep track of all the presentations you've created and change those ones that require work or even more information. The additional feature is the ability to change the presentation's actual picture, as it may be extended to all slides. Slide master view also allows you to change the text format & placeholders.

During January, Dream House Builders, Inc. incurred $550 of actual indirect materials costs, as supported by materials requisitions.

Required:
Draw the journal entry.

Answers

Answer and Explanation:

The journal entry is given below:

Factory overhead Dr $550

      To Raw material inventory $550

(being the actual indirect material cost is recorded)

Here the factory overhead is debited as it increased the expense while the raw material inventory is credited as it decreased the assets

Suppose the United States and Japan have the following production possibility tables:
Japan United States
Bolts of Cloth Tons of Wheat Bolts of Cloth Tons of Wheat
1,000 0 500 0
800 100 400 200
600 200 300 400
400 300 200 600
200 400 100 800
0 500 0 1,000
a. Draw each country’s production possibility curve.
b. In whatgooddoesthe United States have a comparative advantage?
c. Is there a possible trade that benefits both countries?
d. Draw their combinedproduction possibility curve. L04

Answers

Answer:

a) attached below

b) Wheat production

c) Yes there is a possible trade that benefits both countries

d) attached below

Explanation:

Opportunity cost can be expressed as

= Value/cost of alternative / value/cost of chosen alternative

a) Draw each country's production possibility curve

attached below

b) United state have a comparative advantage in Wheat production because of lower opportunity cost

c) The possible trade that would benefit both countries is when  both countries trade on goods that they have lower comparative opportunity cost

i.e. Japan producing just Bolt cloths while United states produce Wheat alone

d) combined production possibility curve

attached below

Mary makes 10 pies and 20 cakes a day and her opportunity cost of producing a cake is 2 pies. Tim makes 20 pies and 10 cakes a day and his opportunity cost of producing a cake is 4 pies. If Mary and Tim specialize in the good in which they have a comparative advantage, _________
A. Mary produces only cakes while Tim produces only pies
B. Mary produces only pies
C. Tim produces both pies and cakes
D. Tim produces only cakes while Mary produces only pies

Answers

Answer:

A. Mary produces only cakes while Tim produces only pies

Explanation:

I will start by describing the concept called comparative advantage. Comparative advantage can be described as a businesses ability to produce at a reduced or lower opportunity cost than others. Given this definition, we can see that Mary's opportunity cost of producing cakes is lower than Tims opportunity cost. So Mary has an advantage over Tim in the production of cakes. So the answer to this question is A. Mary should specialize in the making of cakes while Tim should specalize in pie making

gThe following data are available for Martin Solutions, Inc. Year 2 Year 1 Sales $1,139,600 $1,192,320 Beginning inventory 80,000 64,000 Cost of goods sold 500,800 606,000 Ending inventory 72,000 80,000 Required: Assume a 365-day year. Determine for each year:

Answers

Answer and Explanation:

The computation is shown below;

For Year 1

Average inventory = (Beginning inventory + Ending inventory)÷ 2

= ($64,000 + $80,000) ÷ 2

= $72,000

Inventory turnover = Cost of goods sold  ÷ Average inventory

= $606,000 ÷ 72,000

= 8.4 times

Days in inventory = 365 ÷ Inventory turnover ratio

= 365 ÷ 8.4

= 43.5 days

For Year 2

Average inventory = (Beginning inventory + Ending inventory) ÷ 2

= ($80,000 + $72,000) ÷ 2

= $76,000

Inventory turnover = Cost of goods sold ÷ Average inventory

= $500,800 ÷ 76,000

= 6.6 times

Days in inventory = 365 ÷ Inventory turnover ratio

= 365 ÷ 6.6

= 55.3 days

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