Lisa is a contractor, and she owns a small home renovation company that specializes in kitchen renovations. Lisa fears she has been underbidding her projects, and that translates into lost profits that could help sustain her through slow periods. She is putting together an estimate for a potential client and has determined the following activities: Activity Demo of Existing Space Cabinet Installation Countertop Installation Final bid price Cost Driver $ Square Footage # of Hours Square Footage Rate $3.26 /square foot $205 /hour $12.00 /square foot Estimated Use for Job 520 square feet 8 hours Previously, Lisa was billing at a flat rate of $16 per square foot of the demo space with no additional markup. Lisa would like to add a 20% markup to the cost to arrive at the final bid price. Using Activity-Based Costing (ABC), what is the final bid price for her potential customer? (Round intermediate calculations and final answ to 2 decimal places, e.g. 25,000.25.) 280 square feet

Lisa is a contractor, and she owns a small home renovation company that specializes in kitchen renovations. Lisa fears she has been underbidding her projects, and that translates into lost profits that could help sustain her through slow periods. She is putting together an estimate for a potential client and has determined the following activities: Activity Demo of Existing Space Cabinet Installation Countertop Installation Final bid price Cost Driver $ Square Footage # of Hours Square Footage Rate $3.26 /square foot $205 /hour $12.00 /square foot Estimated Use for Job 520 square feet 8 hours Previously, Lisa was billing at a flat rate of $16 per square foot of the demo space with no additional markup. Lisa would like to add a 20% markup to the cost to arrive at the final bid price. Using Activity-Based Costing (ABC), what is the final bid price for her potential customer? (Round intermediate calculations and final answ to 2 decimal places, e.g. 25,000.25.) 280 square feet

Excel Applications for Accounting Principles

4th Edition

ISBN:9781111581565

Author:Gaylord N. Smith

Publisher:Gaylord N. Smith

Chapter26: Capital Budgeting (capbud)

Section: Chapter Questions

Problem 5R

See similar textbooks

Similar questions

Lisa is a contractor, and she owns a small home renovation company that specializes in kitchen renovations. Lisa fears she has been underbidding her projects, and that translates into lost profits that could help sustain her through slow periods. She is putting together an estimate for a potential client and has determined the following activities: Activity Cost Driver Rate Estimated Use for Job Demo of Existing Space Square Footage $3.26 /square foot 520 square feet Cabinet Installation # of Hours $205 /hour 8 hours Countertop Installation Square Footage $12.00/square foot 280 square feet Previously, Lisa was billing at a flat rate of $16 per square foot of the demo space with no additional markup. Lisa would like to add a 20% markup to the cost to arrive at the final bid price. Using Activity-Based Costing (ABC), what is the final bid price for her potential customer? (Round intermediate calculations and final answer to 2 decimal places, eg. 25,000.25.) Final bid price $
Johnson Filtration. Inc., provides maintenance service for water filtration systems throughout southern Florida. Customers contact Johnson with requests for maintenance service on their water filtration systems. To estimate the service time and the service cost. Johnson’s managers want to predict the repair time necessary for each maintenance request. Hence, repair time in hours is the dependent variable. Repair time is believed to be related to three factors: the number of months since the last maintenance service, the type of repair problem (mechanical or electrical), and the repairperson who performs the repair (Donna Newton or Bob Jones). Data for a sample of 10 service calls are reported in the following table: Develop the simple linear regression equation to predict repair time given the number of months since the last maintenance service, and use the results to test the hypothesis that no relationship exists between repair time and the number of months since the last maintenance service at the 0.05 level of significance. What is the interpretation of this relationship? What does the coefficient of determination tell you about this model? Using the simple linear regression model developed in part (a), calculate the predicted repair time and residual for each of the 10 repairs in the data. Sort the data in ascending order by value of the residual. Do you see any pattern in the residuals for the two types of repair? Do you see any pattern in the residuals for the two repairpersons? Do these results suggest any potential modifications to your simple linear regression model? Now create a scatter chart with months since last service on the x-axis and repair time in hours on the y-axis for which the points representing electrical and mechanical repairs are shown in different shapes and/or colors. Create a similar scatter chart of months since last service and repair time in hours for which the points representing repairs by Bob Jones and Donna Newton are shown in different shapes and/or colors. Do these charts and the results of your residual analysis suggest the same potential modifications to your simple linear regression model? Create a new dummy variable that is equal to zero if the type of repair is mechanical and one if the type of repair is electrical. Develop the multiple regression equation to predict repair time, given the number of months since the last maintenance service and the type of repair. What are the interpretations of the estimated regression parameters? What does the coefficient of determination tell you about this model? Create a new dummy variable that is equal to zero if the repairperson is Bob Jones and one if the repairperson is Donna Newton. Develop the multiple regression equation to predict repair time, given the number of months since the last maintenance service and the repairperson. What are the interpretations of the estimated regression parameters? What does the coefficient of determination tell you about this model? Develop the multiple regression equation to predict repair time, given the number of months since the last maintenance service, the type of repair, and the repairperson. What are the interpretations of the estimated regression parameters? What does the coefficient of determination tell you about this model? Which of these models would you use? Why?
Penny is compiling a list of costs incurred so far on a project. She must categorize these costs so that she can present the amount of direct cost incurred. Which of the following should Penny include in this list?This type of question contains radio buttons and checkboxes for selection of options. Use Tab for navigation and Enter or space to select the option. option A Expense incurred in meeting the regulatory standards for the company option B Benefits for employees in the organization option C Travel expenses to the customer’s office option D Costs incurred for maintaining coffee stations around the office.
Suppose that you have been given a summer job as an Intern at Issac Alrcams, a company that manufactures sophisticated spy cameras for remote-controlled millitary reconnalssance alrcraft. The company, which is privately owned, has approached a bank for a loan to help finance its growth. The bank requires financlal statements before approving the loan. Requlred: Classify each cost listed below as elther a product cost or a perlod cost for the purpose of preparing financial statements for the bank. Costs Product Cost or Period Cost 1. Depreciation on salespersons' cars. 2. Rent on equipment used in the factory. 3. Lubricants used for machine maintenance. 4. Salaries of personnel who work in the finished goods warehouse. 5. Soap and paper towels used by factory workers at the end of a shift. 6. Factory supervisors' salaries. 7. Heat, water, and power consumed in the factory. 8. Materials used for boxing products for shipment overseas. (Units are not normally boxed.) 9. Advertising costs.…
Danielle Hastings was recently hired as a cost analyst by CareNet Medical Supplies Inc. One of Danielle's first assignments was to perform a net present value analysis for a new warehouse. Danielle performed the analysis and calculated a present value index of 0.75. The plant manager, Jerrod Moore, is intent on purchasing the warehouse because he believes that more storage space is needed. Jerrod asks Danielle to come to his office, where the following conversation takes place: Jerrod: Danielle, you're new here, aren't you? Danielle: Yes, I am. Jerrod: Well, Danielle, I'm not at all pleased with the capital investment analysis that you performed on this new warehouse. I need that warehouse for my production. If I don't get it, where am I going to place our output? Danielle: Well, we need to get product into our customers' hands. Jerrod: I agree, and we need a warehouse to do that. Danielle: My analysis does not support constructing a new warehouse. The numbers…
Danielle Hastings was recently hired as a cost analyst by CareNet Medical Supplies Inc. One of Danielle’s first assignments was to perform a net present value analysis for a new warehouse. Danielle performed the analysis and calculated a present value index of 0.75. The plant manager, Jerrod Moore, is very intent on purchasing the warehouse because be believes that more storage space is needed. Jerrod asks Danielle into his office and the following conversation takes place: Jerrod: Danielle, you’re new here, aren’t you? Danielle: Yes, I am. Jerrod: Well, Danielle, I’m not at all pleased with capital investment analysis that you performed on this new warehouse. I need that warehouse for my production. If I don’t get it, where am I going to place out output? Danielle: Well, we need to get product into our customer’s hands. Jerrod: I agree, and we need a warehouse to do that. Danielle: My analysis does not support constructing a new warehouse. The numbers don’t lie; the warehouse does not…
Suppose that you have been given a summer job as an intern at Issac Aircams, a company that manufacturessophisticated spy cameras for remote-controlled military reconnaissance aircraft. The company, which isprivately owned, has approached a bank for a loan to help it finance its growth. The bank requires financialstatements before approving such a loan. You have been asked to help prepare the financial statements andwere given the following list of costs:1. Depreciation on salespersons’ cars.2. Rent on equipment used in the factory.3. Lubricants used for machine maintenance.4. Salaries of personnel who work in the finished goods warehouse.5. Soap and paper towels used by factory workers at the end of a shift.6. Factory supervisors’ salaries.7. Heat, water, and power consumed in the factory.8. Materials used for boxing products for shipment overseas. (Units are not normally boxed.)9. Advertising costs.10. Workers’ compensation insurance for factory employees.11. Depreciation on chairs…
help now please. ! Required information [The following information applies to the questions displayed below] The following information is provided for each Investment Center. Investment Center Cameras Phones Computers Income Less: Target income Residual income (loss) $ Income $ 6,350,000 1,806,000 1,100,000 $ Compute return on investment for each investment center. Which center performed the best based on return on investment? A 3 Cameras 6,350,000 $ 3,444,000 (2,906,000) $ Average Assets $ 28,700,000 12,900,000 17,000,000 Phones Ĉ 1,806,000 $ 216,720 (1,589,280) $ Computers 1,100,000 132,000 (968,000)
XYZ Co. hires a financial consultant to help evaluate whether or not to launch a new line of perfumed shark attractants. The consultant charges a fee of $10,000, half of which must be paid up-front and half to be paid when the project evaluation is completed. The consultant’s fees can be considered a/an _______ of the project. Select one: a. financing cost b. sunk cost c. opportunity cost d. side effect e. cash outflow
The production department is proposing the purchase of an automatic insertion machine. It has identified three machines and has asked the accountant to analyze them to determine which one has the best average rate of return. Machine A Machine B Machine C $83,087.40 $73,001.40 322,364.00 276,958.00 486,676.00 Estimated average income $45,130.96 Average investment Oa. Machine B Ob. Machine C Oc. Machine A Od. Machines B and C have the same preferred average rate of return.
The production department is proposing the purchase of an automatic insertion machine. It has identified three machines and has asked the accountant to analyze them to determine which one has the best average rate of return. Machine A $43,529.50 $80,697.00 Machine B Machine C $64,675.95 310,925.00 268,990.00 431,173.00 Estimated average income Average investment Oa. Machine B Ob. Machine A Oc. Machine C Od. Machines B and C have the same preferred average rate of return.
1. Determining transaction costs Kyoko has decided to replace her old deck, because it is rotting away and has lots of splinters. She is looking for a contractor to build her a new deck and is willing to pay up to $12,000. Jacques, a contractor, is willing to build Kyoko a new deck for as little as $6,000. Kyoko finds Jacques through an online ad. Jacques paid $165 to post the ad online. Kyoko and Jacques agree on a price of $8,000 for the new deck. Kyoko pays a law firm $270 to write up a contract stating that Jacques will build Kyoko a new deck for $8,000. The transaction costs associated with this trade are $