a.
Concept Introduction:
Return on Investment = Net Income / Average Total Assets
Note: Average total assets are calculated as an average of beginning and ending total assets. The formula to calculate the average total assets is as follows:
To Calculate:
The interest earned on the savings account for six months.
b.
Concept Introduction:
Return on Investment: The Return on Investment is the profitability ratio that measures the percentage of profit earned on average assets invested in the business. Return on assets is calculated by dividing the net income by average total assets. The formula to calculate Return on assets is as follows:
Return on Investment = Net Income / Average Total Assets
Note: Average total assets are calculated as an average of beginning and ending total assets. The formula to calculate the average total assets is as follows:
To Calculate:
The
Concept Introduction:
Return on Investment: The Return on Investment is the profitability ratio that measures the percentage of profit earned on average assets invested in the business. Return on assets is calculated by dividing the net income by average total assets. The formula to calculate Return on assets is as follows:
Return on Investment = Net Income / Average Total Assets
Note: Average total assets are calculated as an average of beginning and ending total assets. The formula to calculate the average total assets is as follows:
The decision on investment.
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Chapter 3 Solutions
Accounting: What the Numbers Mean
- What is independence of the audit?arrow_forwardBruno Manufacturing uses direct labor-hours in its predetermined overhead rate. At the beginning of the year, the total estimated manufacturing overhead was $680,000. At the end of the year, actual direct labor-hours for the year were 42,500 hours, manufacturing overhead for the year was underapplied by $25,500, and the actual manufacturing overhead was $695,000. The predetermined overhead rate for the year must have been closest to: A) $16.00 B) $15.75 C) $16.35 D) $16.94arrow_forwardWhat was manufactured overhead?arrow_forward
- Which of the following choices is the correct status of manufacturing overhead at year-end?arrow_forwardMorris Corporation applies manufacturing overhead at the rate of $40 per machine hour. Budgeted machine hours for the current period were anticipated to be 200,000; however, higher than expected production resulted in actual machine hours worked of 225,000. Budgeted and actual manufacturing overhead figures for the year were $8,000,000 and $8,750,000, respectively. On the basis of this information, the company's year-end overhead was: A. overapplied by $250,000 B. underapplied by $250,000 C. overapplied by $750,000 D. underapplied by $750,000arrow_forwardAt the beginning of the year, manufacturing overhead for the year was estimated to be $560,000. At the end of the year, actual labor hours for the year were 35,000 hours, the actual manufacturing overhead for the year was $590,000, and the manufacturing overhead for the year was underapplied by $30,000. If the predetermined overhead rate is based on direct labor hours, then the estimated labor hours at the beginning of the year used in the predetermined overhead rate must have been ___ hours.arrow_forward
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