Based on the CVP analysis of the three business plans provided by Digital Ltd‚ I would like to recommend the Alternative 1 as the most profitable one. This is mainly for three reasons‚ which are motivation factor‚ lower fixed cost and higher contribution margin and highest net income of all the three. Motivating is a very important factor in boosting the sales (Businessballs‚ 2012). Since there is a motivation factor included in Alternative 1‚ it would be highly beneficial for the company as the
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EXAM 1 Question 1 1.5 out of 1.5 points Managerial accounting stresses accounting concepts and procedures that are relevant to preparing reports for Selected Answer: internal users of accounting information. Correct Answer: internal users of accounting information. Question 2 1.5 out of 1.5 points The principle that managers follow when they only investigate departures from the plan that appear to be significant is commonly known as Selected Answer: management by exception. Correct
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Requirement 1 (a) Johnson’s believes that the transfer from the Cushion Division to the Furniture Division should be at market price rather than at cost however this depends on the capacity of the Cushion Division. Johnson’s believes that the transfer from the Cushion Division to the Furniture Division should be at market price rather than at cost however‚ if there is no idle or spare capacity in Cushion Division the market price minus the corresponding variable selling expense would be the
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manager of Jane-HW7 location is entitled to at least $1‚000 bonus. The total bonus amount = $1‚000 + ($5‚278 - $230) /10 x $1 = $1‚504.80 Budgeted Actual Cars washed 18‚400 12‚690 Price per car wash $10 $9.50 Variable cost $5 $4.75 Contribution margin $5 $4.75 Static budget variance = Actual results x Static budget amount (27 x 470 x $4.75) – ( 23 x 800 x $5) = $60‚277.50 - $92‚000 = $31‚ 722.50 U Flexible budget variance = Actual sales in units x (actual CM – Budgeted CM) 12‚690 x ($4
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Preparatory Investigation: The Water Resource‚ Land and and Buildings‚ Market and Prices The Entrepeneurs A young couple in Iceland‚ Johann and Rosa‚ have taken over Johann’s parents’ farm. Traditional husbandry of cattle and sheep for production of meat and dairy products has gone through a rough time so they have been looking for new opportunities in their farming. Johann believes that arctic charr might suit them well. Before making up their mind they inspect their water resources‚ the features
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was the rate of return for owning Serox in the most recent year? (Round to the nearest percent.) 32% 16% 12% 40% 5 The process of evaluating financial data that change under alternative courses of action is called: contribution margin analysis cost-benefit analysis double en... Complete course guide available here - https://bitly.com/1wyRXZE If you are returning to
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Ex. 20.9 B. Ex. 20.10 Contribution margins and selling prices Evaluating marketing strategies Selecting an activity base CVP with multiple products Exercises 20.1 Topic Accounting terminology 20.2 20.3 20.4 20.5 20.6 20.7 20.8 20.9 High-low method of cost estimation Determining required sales volumes Computing break-even points Solving for missing information Ethical implications of CVP Using CVP Using CVP Understanding break-even relationships 20.10 20.11 Margin of safety Applying CVP 20
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the contribution method and page 50 is using the absorption costing. 2. Because of the type of business the company does. The company uses a lot of variable costs and the cost of sales is included in calculating the contribution margin. 3. Because of the type of business the company does. The company uses a lot of variable costs and the cost of sales is included in calculating the contribution margin. | 2003 | 2004 | Total fixed costs | 464 | 436 | Contribution margin ratio
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MANAGEMENT ACCOUNTING (VOLUME II) - Solutions Manual CHAPTER 19 RELEVANT COSTS FOR DECISION MAKING I. Questions 1. Quantitative factors are those which may more easily be reduced in terms of pesos such as projected costs of materials‚ labor and overhead. Qualitative factors are those whose measurement in pesos is difficult and imprecise; yet a qualitative factor may be easily given more weight than the measurable cost savings. It can be seen that the accountant’s role in making decisions deals
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statements for E-company utilizing both variable (contribution margin) and traditional (absorption margin) methods. I will also show E-company’s computed contribution margin ratio‚ gross profit ratio and operating (net) income ratios‚ as well as explain the difference and reconcile operating income for the two methods. Additionally‚ I will discuss which method I would recommend to the CFO and why. INCOME STATEMENTS: Variable Costing Contribution Statement Sales: $10‚005‚000
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