The Rodgers Company makes 27,000 units of a certain component each year for use inone of its products. The cost per unit for the component at this level of activity is asfollows:Direct materials.$4.20Direct labor.$12.00$5.80Variable manufacturing overhead.Fixed manufacturing overhead$6.50******Rodgers has received an offer from an outside supplier who is willing to provide 27,000units of this component each year at a price of $25 per component. Assume that directlabor is a variable cost. None of the fixed manufacturing overhead would be avoidable ifthis component were purchased from the outside supplier.Assume that there is no other use for the capacity now being used to produce thecomponent and the total fixed manufacturing overhead of the company would beunaffected by this decision. If Rodgers Company purchases the components rather thanmaking them internally, what would be the impact on the company's annual net operatingincome?Select one:a. $94,500 increaseb. $81,000 decreaseC. $237,600 decreased: $124,000 increase

Option (b) $81000 decrease is the correct option. Please see the attached solution for the…

Answered: ct one: a. $94,500 increase b. $81,000…

FINANCIAL ACCOUNTING

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ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

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Question A Franklin’s investment fund had a balance of $290,000 on January 1, 1995 and a balance of $448,000 two years later. The amount of interest earned during the two years was $34,000, and the annual yield rate on the fund was 5.4%. Estimate the (dollar-weighted) average date of contributions to the account. Answer: September 26, 1996 Full explain this question and text typing work only We should answer our question within 2 hours takes more time then we will reduce Rating Dont ignore this line
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Year 0 2 Project A -$50,000 $24,200 $16,800 $46,500 Project B -$45,000 $39,000 $18,000 $18,000 Assume these projects are mutually exclusive and the cost of capital is 12.6%. Which of the following statements are true? A. The payback period of project A is 2.19 years. B. You'll accept project A since its NPV is about $872.85 greater than that of project B. C. You'll accept project B since its payback period is shorter than project A. D. Both (A) and (B) are true. E. Both (A) and (C) are true.
Attached is a schedule of five proposed changes at the end of the year. Before the Change After the Change $18,800,000 (a) $200,000 $19,000,000 Proposed Change 400,000 13,600,000 13,200,000 (b) 1,600,000 (c) (100,000) 1,500,000 ($ in 000's) Net sales Cost of goods sold. Operating expenses Other revenue Other expense Net income 500,000 (d) 450,000 (e) Net sales Cost of goods sold Operating expenses Other revenue Other expense Total effect $4,050,000 50,000 (50,000) 550,000 400,000 $4,050,000 Required: 1. & 2. Select whether each of the proposed changes and the total effect of all the changes are conservative, aggressive, or neutral.
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Clearcast Communications Inc. is considering allocating a limited amount of capital investment funds among four proposals. The amount of proposed investment, estimated operating income, and net cash flow for each proposal are as follows: Operating Income Net Cash Flow Investment Year Proposal A: $450,000 $ 30,000 1 $120,000 2 30,000 120,000 3 20,000 110,000 4 10,000 100,000 (30,000) $ 60,000 $ 60,000 40,000 60,000 $510,000 $100,000 Proposal B: $200,000 1 80,000 3 20,000 60,000 4 (10,000) 30,000 (20.000) $ 90,000 20.000 $290,000 (Continued)
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Consider the following sets of investment projects n(years) A($) B($) C($) D($) 0 -3,500 -5,800 -5,200 -40,000 1 600 3,000 2,000 12,000 2 600 2,000 4,000 14,000 3 1,000 1,000 2,000 18,000 4 1,000 500 4,000 18,000 5 1,000 500 2,000 14,000 Compute the equivalent annual worth of each project at i=10% and determine the acceptability of each project.
Question Four Two plants (A) and (B) are suggested to be constructed. Plant (A) with an investment of 105,000$, and Plant (B) with an investment of 25,000 $. End of year 0 1234 Plant (A) (103) Plant (B) (103) 105 25 35 10 35 10 35 10 35 10 35 10 5 a. The net present value at rate of 20 % (2 marks) b. The discounted cash flow rate of return (initial guess 20%). c. Which project you will select and justify your selection.
Problem 25-6 (AICPA Adapted) Chum Company started construction of a new office building on January 1, 2020 and moved into the finished building. on July 1, 2021. Of the P25,000,000 total cost of the building, P20,000,000 was incurred in 2020. evenly throughout the year. The entity's incremental borrowing rate was 12% throughout 2020, and the total amount of interest incurred.was P1,020,000. S, What amount should be reported as capitalized interest on December 31, 2020? а. 1,020,000 b. 1,200,000 с. 1,500,000 d. 2,400,000 CS Scanned with CamScanner
Accounting Problem 10-10 (Algo) Interest capitalization; weighted-average method [LO10- 7] On January 1, 2021, the company obtained a $3 million loan with a 12% interest rate. The building was completed on September 30, 2022. Expenditures on the project were as follows: January 1, 2021 $ 1,230,000 March 1, 2021 720,000 June 30, 2021 380,000 October 1, 2021 670,000 January 31, 2022 990,000 April 30, 2022 1,305,000 August 31, 2022 2,340,000 On January 1, 2021, the company obtained a $3 million construction loan with a 12% interest rate. Assume the $3 million loan is not specifically tied to construction of the building. The loan was outstanding all of 2021 and 2022. The company's other interest-bearing debt included two long-term notes of $5,600,000 and $7,600,000 with interest rates of 8% and 10%, respectively. Both notes were outstanding during all of 2021 and 2022. Interest is paid annually on all debt. The company's fiscal year-end is December 31. Required: 1. Calculate the amount of…

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ct one: a. $94,500 increase b. $81,000 decrease c. $237,600 decrease d: $124,000 increase