3. Given the following data (based on 8,000 units produced and sold each month): direct materials, P6;direct labor, P9; variable overhead, P2; fixed overhead, P8; variable selling, P3; and fixed selling andadministrative expenses, P5. The company computes target selling prices by adding a mark-up of 75%by the contribution approach, or by adding a 40% mark-up by the absorption approach. Based on thesedata, the "floor" and the "ceiling" between the company should operate in special pricing decisions are,respectively:a. P20 and P35b. P20 and P25e. None of these; answer isc. P33 and P35d. P25 and P35

Answered: Iministrative expense the contribution…

Business

Accounting

Iministrative expense the contribution app ata, the "floor" and th spectively: P20 and P35

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: windaer Lomparry buyan speratiuma un Jeruary 1, 2018. and uaa the everupe-coat muthud of pris ng…

A: Under average cost method, Inventory is valued at average cost. Under FIFO method, inventory is…

Q: onj on june 15, 2013 , ioleal faremitura eoquipment discardend that Rad a cont d lo, o00$ amd was…

A: Fixed asset: It is a long-term asset used in the business for long period and is depreciated for its…

Q: At the break-even point: O a Sales would be equal to contribution margin. Ob Sales Would be equal to…

A: Break-Even Point: This is a point where total revenue and total cost are equal and the company is…

Q: Refer to the following given information. The cost of inventory sold to customer 220,000 Advertising…

A: Ratio analysis: Ratio analysis is a tool that establishes a relationship between the different…

Q: LC8Q3.Which of the following is a variable cost? Loan interest rate Salary Rent Salesperson s…

A: A variable cost is a type of cost which changes in accordance to the change in the level of output.

Q: • Use the below information to fill out the income statement and answer the questions 4-10 below:…

A: Calculation of Net Income :- Operating leverage 5 =Contribution / Net Income ( EBIT) 5 EBIT =…

Q: The amount of money that you are willing to pay from the total price of the asset is called; O a.…

A: THE AMOUNT OF MONEY THAT YOU ARE WILLING TO PAY FROM THE TOTAL PRICE OF THE ASSET IS IMMEDIATE…

Q: When should a company recognize revenue under GAAP? Multiple Choice When the promised performance…

A: According to generally accepted accounting principles (GAAP), the following two criteria must be…

Q: 5.) EUAC=P(A/P, i, n) - S (A/F, i, n) - Eqtn 1 EUAC=P-S (A/F, i, n) + Pi - Eqtn 2 EUAC=P-S (A/P, I,…

A: The equivalent uniform annual cost (EUAC) is a financial statistic that translates a series of cash…

Q: In any construction project, the total bill to the owner must equal a. Gross profit b. Net profit c.…

A: The construction contract accounting is the accounting system suitable for businesses engaged in…

Q: A & B D. Consider a port folio of E CRA) : 207. E CR): 30% 2. assets where nsky = 10% A,B :20% hnd…

A: Solution:- Minimum Variance Portfolio is that portfolio in which the weights of securities are such…

Q: Cost recovery can be .18 related to capital maintenance

A: Cost recovery can be related to capital maintenance. Because both cost recovery and capital…

Q: Net defined benefit asset results in Current service cost Interest expense Interest revenue

A: As per IAS 19 of IFRS mentions how the accounting should be done to employee benefit other than…

Q: Which of the following methods is being described by a transfer price equal to 130% of full cost?…

A: The concept of transfer price generally arises when one division sells goods or services to another…

Q: In the Economic Order Quantity (EOQ) Theory, if CO £20, D 24,000, EOQ 400, calculate the…

A: EOQ theory state and calculate the ideal order quantity that an organization needs to be purchased…

Q: Fringe benefits are reported as on the income statement. Multiple Choice Assets Expenses Liabilities…

A: Fringe benefits - These are the benefits offered to employees apart from the salary given to…

Q: Calculate the VAT amount of an item if the VAT inclusive amount is R250. A) R32.61 B) R30.62…

A: Valued Added Tax: It implies to a financial levy that is charged by the government on the value…

Q: d. Margin Calculation (Net Margin amount pp = Add PP net costs and margin to get - Final Net Selling…

A: In the context of the given question, we are required to compute the margin and retail travel agent…

Q: Which one is fixed cost اخترأحد الخیارات a. Both A & B O b. Rent,salaries, Insurance O c. Only B…

A: The fixed costs are the costs which remain fixed for the period of time.

Q: The tree diagram in figure below describes the uncertain cash flows for an engineering project. The…

A: Answer) The tree diagram shows a starting node (A) showing a value of -$27,000 and gives rise to…

Q: P write the likelytrandactony thet the ace result in the equation. a) tnerease in ealited,…

A: Accounting equation is the one which is used for the representation of the financial statements. The…

Q: Present and future value tables of $1 at 3% are presented below. PVAD $1 N FV $1 PV $1 1 1.03000…

A: It is a question that requires calculating the initial deposit so that its value becomes $50000 in 5…

Q: #E=P28,091.16 and N = P11,213.00, what is the value of D? Note: E= Total Earnings D-Deduction N =…

A: Formula: Net pay = Total earnings - Deductions

Q: Determine the FW of the foliowing engineering project when the MARR is 18% por year. Is the project…

A: From the given information, Annual net benefit ($) = Receipt - Expense = 7,500 - 3,000 = 4,500 FW…

Q: Determine the present value of the following single amounts (EV of $1. PV of S1. EVA of S1 EVA.of…

A: Present Value refers to the discounted value of a single cash flow or multiple cash flows today…

Q: 00. Trade and other receivable will be

A: Trade and other receivables are assets to the entity.

Q: Windsor Enterprises is using a discounted cash flow model Identify which model Windsor might use to…

A: The time value of money is a concept related to the change in the value of money as time passes. The…

Q: what is the value of N?

A: Net pay is the pay which has been received by the employee from the employer in hand means net pay…

Q: Interpret the figure below: find (a) Presen additional maintenance cost, (b) Present worth of all…

A: Present value is the equivalent value today of the future cost based on the time period and interest…

Q: Profit equals: O (P x Q-V x Q) - fixed expenses.

A: PROFIT=[P X Q - V X Q]- FIXED EXPENSES

Q: Distinguish betwenn program service expenses and supporting service expenses.

A: Expenditures related to the public services offered by the NFP are referred to as program service…

Q: am. 176.

A: Step 1NPV = Sum of Present Value of Cash Flows.IRR = Rate at which NPV of a project is zero. a-1)…

Q: What is the situation that best describes the following amortization schedule? Payment # Amount Paid…

A: From the above table the opening principal balance is 12,000. Thus we can say that the amount of…

Q: The following information relates to four assets: Probability Return on E Return on F Return on G…

A: Step 1: Expected return on each asset value = P1.R1 + P2.R2 + . . . + Pn.Rn Step 2: Variance on…

Q: Galy Oricss considering an investment innewping evement ceng S514.000 The ment w be deorecated on a…

A: The question is related to the Capital Budgeting. The pay back period is the length of time…

Q: Help please

A: Capital budgeting is a technique that is used by investors to evaluate various investment proposals…

Q: Annual equivalent cost (AEC),

A: The Annual Equivalent Cost (AEC) is the annual cost of acquiring an asset over its entire life. The…

Concept explainers

Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.

Question

100%

3. Given the following data (based on 8,000 units produced and sold each month): direct materials, P6;
direct labor, P9; variable overhead, P2; fixed overhead, P8; variable selling, P3; and fixed selling and
administrative expenses, P5. The company computes target selling prices by adding a mark-up of 75%
by the contribution approach, or by adding a 40% mark-up by the absorption approach. Based on these
data, the "floor" and the "ceiling" between the company should operate in special pricing decisions are,
respectively:
a. P20 and P35
b. P20 and P25
e. None of these; answer is
c. P33 and P35
d. P25 and P35

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

Use the NPV method to determine whether Root Products should invest in the following projects: • Project A: Costs $275,000 and offers eight annual net cash inflows of $53,000. Root Products requires an annual return of 12% on investments of this nature. Project B: Costs $380,000 and offers 9 annual net cash inflows of $74,000. Root Products demands an annual return of 10% on investments of this nature. E(Click the icon to view Present Value of $1 table.) E (Click the icon to view Present Value of Ordinary Annuity of $1 table.) Read the requirements. Requirement 1. What is the NPV of each project? Assume neither project has a residual value. Round to two decimal places. (Enter any factor amounts to three decimal places, X.XXX. Use parentheses or a minus sign for a negative net present value.) Caclulate the NPV (net present value) of each project. Begin by calculating the NPV of Project A. Project A: Net Cash Annuity PV Factor Present Years Inflow (i=12%, n=8) Value 1-8 Present value of…
Net Operating Income (-) Interest Expense (-) Cost Recovery Allowance (=) _________________ (or) NOI (minus) Interest Expense (minus) Cost Recovery Allowance (equals) ___________________ Group of answer choices
Following s theinfornaotion Conteiact. sueloting da amount $ Contsact paiice. Raw moterials wages Sub-(ontsiact plant matesials tsians ļ 0uued to othor 6,00,000 120,000 Li60,000 5,000 20,000 2.000 Cont'siact. 4oneral expenses At the end01 the , Cash rereived fm the Contsiactee wos $250.O00 being 80%% of wa Contified, yalue | the year was $ 18,000. plant do be depsieciated at 20%. DHepaue (onteiact account. 7.600 year, to motorials unused at he ond Contsiact.
29. Which of the following may increase by a relatively constant amount each period. a. First Cost b. Maintenance c. Repair O d. Replacement Cost O e. None of the above
27) Which among the following cost encourage management to focus on life cycle costing? a. All the options listed b. Maintenance costs c. Repair costs d. Warranty costs
bdhdhdjdjdjjdis plz dont answer current ration in the following: Current Asset $20000., Current Liability $20000
A company that was to be liquidated had the following liabilities: Income Taxes Notes Payable secured by land Accounts Payable $ 15,000 120,000 48,000 Salaries Payable ($18,000 for Employee #1 and $5,000 for Employee #2) Administrative expenses for liquidation The company had the following assets: 23,000 Current Assets Land Building Saved 25,000 Book Fair Value Value $130,000 $115,000 60,000 100,000 175,000 220,000 Total liabilities with priority are calculated to be what amount? Multiple Choice О $106,650. $38,000.
Statement I: IFRS 15 prescribes specific estimation techniques for variable consideration and only permits variable amounts to be included to the extent that it is probable that the revenue will not reverse.Statement Il: Transaction price (at inception) should be allocated to all the performance obligations in the contract in proportion to the cost of each performance obligation. • True, True • True, False • False, False • False, True
ote: Total Aet-Cuat linbiwbe Accumulated fundo tthistoation: The recepts and gagmetsalleunte of Liar c for the you Balane If Sub saptindn knded 2lst Delamt 1999 Wee ce Inserrance Rate l,000 ting 3,650 L, 700 600 Glavenalerpanes 6itor Reut fnnitume Sought lana /d 27,250 Sonatins 8,500 8,150 7,80 2,St0 27250 The fillowing nformetim Rates were 3600 2,F00 popaid Geneal Raputes prepaid Doo Raut Buing Subsaptim in Qureas 100 75 Foo 600 The foced assets funituns Cnd fifting Premies bepreciate thu Asets as at Ist jan 999 were; at1,500 A5,00 by o pepare; Youre veequired to Statemat of affats - m Come and"copenditwe allounts 2 Balane sheetas at 3lst Delember 1999,
for part b, you entered the figure £45.17... as the D0. where did you get this figure from as its nowhere else in your working out?
Period cost is O A. inventoriable cost B. allocated between sold and unsold C. fully expense in the period incurred D. none of the choices
Current Attempt in Progress Tamarisk Company reports the following costs and expenses in May. Factory utilities Depreciation on factory equipment Depreciation on delivery trucks Indirect factory labor Indirect materials Direct materials used Factory manager's salary From the information: $14,800 12,120 3,840 47,120 77,440 132,480 8,000 Direct labor Sales salaries Property taxes on factory building Repairs to office equipment Factory repairs Advertising Office supplies used $66,480 44,320 2,400 1,280 1,920 14,400 2,510