12-The project manager for a large project being developed in northern Ontario recognizes that it will be necessary for her tomaintain a close presence at the construction site during its development and has negotiated the use of a building for her team nearthe construction project. The cost of the building must be factored into the project cost and will increase with use: that is, the cost ofheating and other utilities is subject to change depending upon weather and team use. What type of cost would this buildingrepresent?A. Variable directB. IndirectC. NonrecurringD. None of the above

Costing is a technique to note down in the business records the expenses incurred by an entity to…

Answered: 12-The project manager for a large…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Use the following information to answer questions 1 to 5. A development corporation purchased land that will be the site of a new luxury condominium complex. Management is considering a six month market research study designed to learn more about potential market acceptance of the condominium project. Management anticipates that, if conducted, the market research study will provide one of the following two results. 1. Favorable report (F): A significant number of the individuals contacted express interest in purchasing a condominium. 2. Unfavorable report (U): Very few of the individuals contacted express interest in purchasing a condo- minium. After deciding whether to conduct the market research study, they have the following two decision alternatives. d1 = a small complex with 30 condominiumsd2 = a medium complex with 60 condominiumsFollowing this, a chance event concerning the demand for the condominiums has two states of nature. s1 = strong demand for the condominiumss2 = weak…
Refer to Picture, Please answer Part A and B
A new storm drainage system must be constructed right away to reduce periodic flooding that occurs in a city that is in a valley. Five mutually exclusive designs have been proposed, and their present worth (in thousands of dollars) of costs and benefits are the following. Solve, a. Which system has the greatest B–C ratio? b. Which system has the largest incremental B–C ratio(based on differences between alternatives)? c. Which system should be chosen ?
You’re called out of an investment committee meeting at your real estate company for an important phone call. Stepping back into the meeting you find you’ve missed the initial description of the Subject Property, but a heated debate on which Comparable Properties should be used to evaluate the property is underway. Glancing at a handout your analysts have prepared, you see observe the following table: Comp A Comp B Comp C Comp D Comp E Distance from Subject 0.50 Miles 0.75 miles 1 mile 0.25 miles 0.90 miles Year of Construction 1990 2005 1985 2015 2006 Sq. Ft. 14,000 SF 24,000 SF 10,000 SF 25,000 SF 37,000 SF Months Since Sale 3 months 9 months 12 months 4 months 2 months
During 2020, BLACKPINK INC. incurred costs to develop and produce a routine, low-risk computer software product as follows: • Completion of detailed program design or working model- 1,000,000 • Cost incurred for coding and testing to establish technological feasibility- 200,000 • Other coding costs after the establishment of technological feasibility- 2,000,000 • Other testing costs after the establishment of technological feasibility- 1,500,000 • Costs of producing product masters for training materials- 2,500,000 • Duplication of computer software and training materials from product master- 3,000,000 • Production overhead- 1,000,000 • Packaging product- 500,000 • Administrative overhead- 750,000 • Promotional cost of the finished software- 200,000 • Abnormal amount of wasted materials and labor costs- 250,000 In the December 31, 2020 balance sheet, what amount should be reported as inventory?
6. In a company's renovation of a small office building, two feasible alternatives for upgrading the heating, ventilation, and air conditioning (HVAC) system have been identified. Either Alternative A or Alternative Bmust be implemented. The costs are as follows: Alternative A: Rebuild (overhaul) the existing HVAC system V Equipment, labor, and materials to rebuild. v Annual cost of electricity v Annual maintenance expenses . ETB 18,000 ETB 32,000 ЕТВ 2,400 Alternative B: Install a new HVAC system that utilizes existing ductwork V Equipment, labor, and materials to install. v Annual cost of electricity. . ETB 60,000 .ЕТВ 9,000 V Annual maintenance expenses ETB 16,000 v Replacement of a major component four years hence.. ETB 9,400 At the end of eight years, the estimated market value for Alternative A is ETB 2,000 and for Alternative B it is ETB 8,000. Assume that both alternatives will provide comparable service (comfort) over an eight-year period, by using 8% discount rate Select the…
Check each of the following that are sunk costs. Group of answer choices A machine then was used to research a new product that can be used in the production process if we go forward with the project, or sold if we do not The market value of the land on which we plan to build a factory The original cost of the land on which we plan to build a factory The amount we paid our research scientists to determine the feasibility of a product we are now considering. The cost to construct a factory we will build if we launch the a new product
The first step in the development process is to gain control of the site. What is the most common, and lowest risk, method to obtain control of a site from another owner? O By purchasing directly from the existing owner By negotiating an option to purchase from the existing owner O By purchasing land at auction from the city O By borrowing money from a construction lender
Example: It is proposed to construct a self-financing road tunnel. The criterion is that the toll paid by the vehicles over the life of the project must be sufficient to cover both the initial capital and the other costs which will be incurred over the project's life. Determine a suitable charge on each vehicle passing through the tunnel using the following estimated figures based on 1996 prices. 1. Capital cost Construction cost Land cost Professional fees 2. Annual OMR cost 3. Annual administration cost 4. Replacement cost of autopay ticket machine 5. Estimated annual traffic flow 6. Life of project 7. Required rate of return (real) 8. Estimated inflation rate in the next 20 years $100,000,000 $2,500,000 $5,000,000 $1,000,000 every 5 years 10,000 vehicles per day in the first five years; the growth rate of traffic flow is 30% every 5 years 20 years 12% 10% p.a. (average)
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