After reviewing financial reports of her company's daycare service, Camila determines it should be closed due to a loss.$120965Variable costs$47970Traceable (avoidable) fixed costs$70687Allocated corporate overhead$45828What would be the impact to net income of closing the daycare? State loss as negative, gain as positive. Round only your finalanswer to the nearest dollar.Revenues

Net loss or income is calculated by substracting cost from revenue. avoidable fixed cost are those…

Answered: After reviewing financial reports of…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Recently, the owner of a Trader Joe's franchise decided to change how she compensated her top manager. Last year, she paid him a fixed salary of $65,000, and her store made $120,000 in profits (not counting payment to her top manager). She suspected the store could do much better and feared the fixed salary was causing her top manager to shirk on the job. Therefore, this year she decided to offer him a fixed salary of $30,000 plus 15 percent of the store's profits. Since the change, the store is performing much better, and she forecasts profits this year to be $280,000 (again, not counting the payment to her top manager). Assuming the change in compensation is the reason for the increased profits, and that the forecast is accurate, (a) Which compensation method (the old one or the new one) will the manager prefer? Please explain why. (b) Which compensation method (the old one or the new one) would the owner of the franchise prefer? Please explain why. (c) If there was another…
Kory operates a sporting goods store. His records indicate that he had sales of $78,000. Customers return $1500 worth of sporting goods because of various defects. His cost of goods sold was $19,000. What is Kory's Schedule C (Form 1040) gross income? Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.
Infinity Designs, an interior design company,has experienced a drop in business due toan increase in interest rates and acorresponding slowdown in remodelingprojects. To smulate business, thecompany is considering exhibing at theHome and Garden Expo. The exhibit willcost the company $12,000 for space. At theshow, Infinity Designs will present a slideshow on a PC, pass out brochures that areprinted previously, (the company printedmore than needed), and show its porolio ofpreviousjobs.The companyesmates thatrevenue will increaseby $36,000 over thenext year as a resultof the exhibit. For theprevious year, profitwas as follows:Revenue $201,000Less:Design supplies (variable cost) $15,000Salary of Samantha Spade (owner) 80,000Salary of Kim Bridesdale (full meemployee)55,000Rent 18,000Ulies 6,000Depreciaon of office equipment 3,600Prinng of adversing materials 700Adversing in Middleton Journal 2,500Travel expenses other than depreciaonof autos (variable cost)$3,000Depreciaon of company cars…
Forman's Services is a small accounting firm that offers payroll and bookkeeping services to small businesses and individuals. A local merchant has approached Will Forman, the owner, about taking over his payroll disbursements, but is concerned about the fees Forman's normally charges. The costs and revenues at Forman's Services follow. Sales revenue Costs FORMAN'S SERVICES Annual Income Statement Labor Equipment lease Rent Supplies Owner's salary Other costs Total costs Operating profit (loss) If Forman's gets the merchant's business. It will incur an additional $31,000 in labor costs. Will also estimates that he will have to Increase equipment leases by about 10 percent, supplies by 15 percent, and other costs by 5 percent. There will be no additional rent. Required: a. What are the differential costs that would be incurred as a result of adding this new client? b. Will would normally charge about $51,000 in fees for the services the store would require. How much could he offer to…
Assume you wrote up a proposal requesting $5000 for charity. The money would be used to buy food that volunteers (employees from the company) would distribute to the homeless on Saturday. The proposal is approved and you receive the money. However, the CEO comes to you and asks, "What will be the return on the investment?" How would you reply?
Which of the following is NOT considered an Agency Problem? Multiple Choice The Chairman of the Board decides to throw his wife a lavish birthday party in Tahiti using company funds. A salesperson stops working after the commission payout has hit her annual limit. A manager makes a bad decision, but he has nothing to gain personally from it. The CEO of a company uses the company's jet for personal (non-business-related) travel. A purchasing manager passes up on a positive NPV project because he feels that his job will be in jeopardy if the project fails.
What is the VC for this please? I came up with 1.44 but getting a message this is incorrect. After graduating from dental school two years ago, Dr. Lauren Farish purchased the dental practice of a long-time dentist who was retiring. In January of this year, she had to replace the outdated autoclave equipment she inherited from the previous dentist. Now, as she is preparing her budget for next year, she is concerned about understanding how her cost for sterilizing her dental instruments has changed. She has gathered the following information from her records: Month Number of instruments used Total autoclave cost January 850 $7,600 February 750 6,800 March 920 8,200 April 950 8,600 May 1,150 9,900 June 900 8,100 July 1,050 9,600 August 975 8,700 (a) Partially correct answer icon Your answer is partially correct. Identify the high…
The basis for recognizing patient care revenue is not always obvious. In a particular month Northwest Medical Clinic reported the following: 1. It provided direct care services to patients, billing them $400,000. Of this amount it received $120,000 in cash, but as a consequence of bad debts it expects to collect a total of only $330,000. 2. It provided direct care to patients covered by insurance and who are members of various group health plans for which, at standard rates, it would have billed $650,000. However, owing to contractual arrangements with the payers, it actually billed them for, and expects to collect, only $480,000. 3. It provided charity care for which it would have billed, at standard rates, $82,000. 4. It received capitation fees of $1,400,000 from health care plans and provided services to members of those plans for which it would have billed, at standard rates, $1,600,000. Prepare appropriate journal entries to recognize revenue.
Consultants notify management of Discount Pharmaceuticals that a stroke medication poses a potential health hazard. Counsel indicates a product recall is probable and is estimated to cost the company $10.00 million. Required: How will this affect the company's income statement and balance sheet this period? Note: Enter your answers in dollars, not in millions (i.e., $5.5 million should be entered as $5,500,000). Amounts to be deducted should be indicated by a minus sign. Assets Balance Sheet Stockholders' Equity Liabilities Revenues Common Stock Retained Earnings Income Statement Expenses Net Income
Ronald Roth started his new job as controller with Aerosystems today. Carole, the employee benefits clerk, gave Ronald a packet that contains information on the company's health insurance options. Aerosystems offers its employees the choice between a private insurance company plan (Blue Cross/Blue Shield), an HMO, and a PPO. Ronald needs to review the packet and make a decision on which health care program fits his needs. The following is an overview of that information. a) The monthly premium cost to Ronald for the Blue Cross/Blue Shield plan will be $59.79. For all doctor office visits, prescriptions, and major medical charges, Ronald will be responsible for 20 percent, and the insurance company will cover 80 percent of covered charges. The annual deductible is $840. b) The HMO is provided to employees free of charge. The copayment for doctors' office visits and major medical charges is $25. Prescription copayments are $20. The HMO pays 100 percent after Ronald's copayment. There is…

Recommended textbooks for you

FINANCIAL ACCOUNTING

Accounting

ISBN:

9781259964947

Author:

Libby

Publisher:

MCG

Accounting

ISBN:

9781337272094

Author:

WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.

Publisher:

Cengage Learning,

Accounting Information Systems

Accounting

ISBN:

9781337619202

Author:

Hall, James A.

Publisher:

Cengage Learning,

FINANCIAL ACCOUNTING

Accounting

ISBN:

9781259964947

Author:

Libby

Publisher:

MCG

Accounting

ISBN:

9781337272094

Author:

WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.

Publisher:

Cengage Learning,

Accounting Information Systems

Accounting

ISBN:

9781337619202

Author:

Hall, James A.

Publisher:

Cengage Learning,

Horngren's Cost Accounting: A Managerial Emphasis…

Accounting

ISBN:

9780134475585

Author:

Srikant M. Datar, Madhav V. Rajan

Publisher:

PEARSON

Intermediate Accounting

Accounting

ISBN:

9781259722660

Author:

J. David Spiceland, Mark W. Nelson, Wayne M Thomas

Publisher:

McGraw-Hill Education

Financial and Managerial Accounting

Accounting

ISBN:

9781259726705

Author:

John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS