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We have shown in this module that poor decision making may result when acceptable prices are determined by adding a fixed percentage to the "full cost" of a product when that "full cost" includes a unitized fixed cost. The lesson in the module is that any selling price above the contribution margin will add to the wealth of the firm. This being the case, is there a danger in the decision rule that states "always accept any offer that has a positive contribution margin?" Please expand on your explanation by giving examples. Also, what about the issue of capacity? Does it have any impact on the above decision making process if a company operates at full capacity or have idle capacity? Why is it sometimes important to allocate overhead costs among products, services or some other grouping? Other times the allocations should be disregarded as in this case - why?
Evaluate GenMet's net income for fiscal year 2013. Round your calculations and answer to one decimal place. Enter the amount in millions.
Quick Fix Services, Inc. is trying to establish the standard labor cost of a typical oil change.The following data have been collected from time and motion studies conducted over the past month. Find out the standard direct labor hours per oil ch..
Find out the contribution margin in dollars, per unit, and as a ratio. Using the contribution margin technique, compute the break-even point in dollars and in units.
GST's federal-plus -tax rate is 40%. Illustrate what is the total dollar call premium required to call the old issue?
Determine the current year's overhead application rate
Preparation of journal entries for various transactions in corporate - Prepare the journal entries for the following 2008 transactions. Place your answers below the rest of these questions.
NFP's flexible budget allows how many kg's of inputs for the most current operating period
Which depreciation method would result in the highest amount of income tax expense being paid in the first year of an asset's useful life
If a single-rate cost-allocation method is used, what amount of operating costs will be budgeted for the Lamp Division each month? For the Flashlight Division each month?
Calculation of Over heads to be assigned to a unit of output - what amount of overhead will be assigned to a unit of output which requires 0.5 machine hours and 0.25 labor hours to complete?
Journalize the required adjusting entries for Drake at the end of 2013.
Recognize who, other than O'Conner, could be harmed by this theft. In what ways would they be harmed? Show the role accounting plays in this situation.
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