Exercise 6A-1 High-Low Method [LO6-10] The Cheyenne Hotel in Big Sky, Montana, has accumulated records of the total electrical costs of the hotel and the number of occupancy-days over the last year. An occupancy-day represents a room rented for one day. The hotel's business is highly seasonal, with peaks occurring during the ski season and in the summer. Month Occupancy-Days Electrical Costs January 1,736 $ 4,127 February 1,904 $ 4,207 March 2,356 $ 5,083 April 960 $ 2,857 May 360 $ 1,871 June 744 $ 2,696 July 2,108 $ 4,670 August 2,406 $ 5,148 September 840 $ 2,691 October 124 $ 1,588 November 720 $ 2,454 December 1,364 $ 3,529 Required: 1. Using the high-low method, estimate the fixed cost of electricity per month and the variable cost of electricity per occupancy-day. (Do not round your intermediate calculations. Round your Variable cost answer to 2 decimal places and Fixed cost element answer to nearest whole dollar amount.) 2. What other factors in addition to occupancy-days are likely to affect the variation in electrical costs from month to month

Answer:

1) variable cost = $1.56 per day

fixed costs = $1,395 per month

2) another aspect that increases or decreases electrical consumption is the weather. During very hot days, more people use the air conditioner, which increases electricity costs. Very cold weather will result in a similar increase in electric consumption.

Explanation:

Month Occupancy-Days Electrical Costs

January 1,736 $ 4,127

February 1,904 $ 4,207

March 2,356 $ 5,083

April 960 $ 2,857

May 360 $ 1,871

June 744 $ 2,696

July 2,108 $ 4,670

August 2,406 $ 5,148

September 840 $ 2,691

October 124 $ 1,588

November 720 $ 2,454

December 1,364 $ 3,529

variable cost = (highest activity cost - lowest activity cost) / (highest activity level - lowest activity level) = ($5,148 - $1,588) / (2,406 - 124) = $1.56 per day

fixed costs = $5,148 - ($1.56 x 2,406) = $1,395

Use Apple's financial statements in Appendix A to answer the following. Required: 1. Using fiscal 2014 as the base year, compute trend percents for fiscal years 2014, 2015, and 2016 for net sales, cost of sales, operating income, other income (expense) net, provision for income taxes, and net income. 2. Compute common-size percents for fiscal years 2015 and 2016 for the following categories of assets: (a) total current assets; (b) property, plant and equipment, net; and (c) goodwill plus acquired intangible assets, net. 3. Using current assets as a percent of total assets to measure liquidity, did Apple's asset makeup become more liquid or less liquid in 2016

What is one argument in favor of the Fed using aggressive expansionary monetary policy during an economic crisis?

Devon, the CEO believes that his staff just needs a little push by giving them an understanding of the importance of each of their positions to the company while allowing them to also see each of their own direct impact. Each position, from product development to sales plays a crucial role in Change It Pharmaceuticals. Devon feels that giving timely information regarding their job performance and letting them know the importance of their roles to the company will improve work performance.

Required:
Devon has focused on which two characteristics of the job characteristic model?

Jocko works for IBM, a publicly traded company that sponsors a stock bonus plan. Which of the following statements is not correct regarding the plan? a. If the distribution of IBM stock is made to Jocko in installments over a two year period, then the fair market value of all employer securities distributed in the installment distribution will be taxable as ordinary income. b. Jocko is permitted to vote the shares of IBM within his account. c. Upon termination, Jocko must be given the right to receive IBM stock held in the plan as part of a distribution. d. If Jocko has less than three years of service, he is permitted to diversify one-half of company match contributions that consist of IBM stock.

Suppose that you start working for a company at age 25. You are offered two rather unlikely, but quite enticing, retirement plans from which you are allowed to choose one. [Round all answers to the nearest dollar.]Retirement plan 1: When you retire, you will receive $20,000 for each year of service.Retirement plan 2: When you start work, the company deposits $2500 into a savings account that is guaranteed to pay a yearly rate of 18%. When you retire, the account will be closed and the balance given to you.A. Determine the amount you would receive under plan 1, if you retired at age 55.

g The Dynatech Brewing Company is a small craft brewer that produces five standard varieties of beer. The beers sell for $6 per six-pack, and the company currently sells 7,000 six-packs per month. The company is considering producing a seasonal beer that will be sold in October, November, and December. The company estimates that at $6 per six-pack, the company will sell 1,400 six-packs. At $7 per six-pack, sales will be 700 six-packs. The company also estimates that sales of the seasonal beer will eat into sales of its standard items. Specifically, for every 700 six-packs of the seasonal beer that are sold, 210 six-packs of the standard varieties will not be sold. The variable production costs of all beers is $1.70 per six-pack. Calculate the incremental profit associated with the two selling prices under consideration for the seasonal beer (i.e., $6 and $7 per six-pack). (Enter loss using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) $6 per six-pack $7 per six-pack Incremental profit/(loss) $enter a dollar amount $enter a dollar amount eTextbook and Media Should Dynatech Brewing produce the beer

Cost of Bank Loans Gifts Galore Inc. borrowed $1.6 million from National City Bank. The loan was made at a simple annual interest rate of 12% a year for 3 months. A 25% compensating balance requirement raised the effective interest rate. Do not round intermediate calculations. Round your answers to two decimal places. The nominal annual rate on the loan was 11.5%. What is the true effective rate? % What would be the effective cost of the loan if the note required discount interest? % What would be the nominal annual interest rate on the loan if the bank did not require a compensating balance but required repayment in three equal monthly installments? %

c. Which asset was riskiest during the Great​ Depression? How does that fit with your​ intuition? ​ (Select the best choice​ below.) A. The riskiest assets were the corporate bonds. Intuition tells us that company debt should be riskiest. B. The riskiest assets were the stocks in the​ S&P 500. Intuition tells us that large companies should be the riskiest. C. The riskiest assets were the small stocks. Intuition tells us that smaller companies should be riskiest. D. The riskiest assets were the Treasury Bills. Intuition tells us that government securities would be the riskiest.

What is the purpose of a W-2 form?

A company has the following information available for the year ending December 31, 2019:_______.
Service Revenue $91,300
Operating Expenses $52,900
Gain on Sale of Land $32,000
Loss on Sale of Equipment ($2,000)
Retained Earnings, 12/31/2019 $100,000
Dividends declared in 2019 $22,000
Required:
Calculate the company's (A) net income or loss for the year ending December 31, 2019 and (B) the balance in Retained earnings on January 1, 2019, the beginning of the fiscal year.

Chance Company had two operating divisions, one manufacturing farm equipment and the other office supplies. Both divisions are considered separate components as defined by generally accepted accounting principles. The farm equipment component had been unprofitable, and on September 1, 2016, the company adopted a plan to sell the assets of the division. The actual sale was completed on December 15, 2016, at a price of $640,000. The book value of the division’s assets was $1,090,000, resulting in a before-tax loss of $450,000 on the sale. The division incurred a before-tax operating loss from operations of $120,000 from the beginning of the year through December 15. The income tax rate is 30%. Chance’s after-tax income from its continuing operations is $440,000.Required:Prepare an income statement for 2016 beginning with income from continuing operations. Include appropriate EPS disclosures assuming that 100,000 shares of common stock were outstanding throughout the year. (Amounts to be deducted should be indicated with a minus sign. Round EPS answers to 2 decimal places.)

Suppose that during the past 3​ years, equilibrium real GDP in a country rose​ steadily, from ​$ billion to ​$ ​billion, but even though the position of its aggregate demand curve remained​ unchanged, its equilibrium price level steadily​ declined, from to . What could have accounted for these​ outcomes, and what is the term for the change in the price level experienced by this​ country? A. Economic growth without an increase in aggregate​ demand; secular deflation. B. Recession with​ inflation; stagflation. C. Economic growth with an increase in aggregate​ demand; secular deflation. D. Increase in aggregate demand without economic​ growth: disinflation.

Local Broad Cost Leader - Low priced products for the local region: our brands offer solid value. Our primary stakeholders are bondholders, customers, stockholders, and management. Global Broad Differentiator - Premium products for the industry across the globe: our brands withstand the test of time. Our primary stakeholders are customers, stockholders, management, and employees. Global Niche Cost Leader - Reliable products for low technology customers across the globe: our brands offer value. Our primary stakeholders are bondholders, stockholders, customers, and management. Global Niche Differentiator - Premium, tailored products for technology-oriented customers across the globe: our brands define the cutting edge. Our primary stakeholders are customers, stockholders, management, and employees. Which mission statement best represents the Baldwin Company

A highly visible IT project has attracted some of the brightest developers in the company. Unfortunately, the potential for conflict is also high. The project manager will rely on all her skill sets to complete the project successfully. She is very aware that her interpersonal skills can influence the project outcome. What are the specific interpersonal skills she is most likely to utilize? Select one: a. Leadership, negotiation, and influencing b. Active listening, negotiation skills, accommodating, and influencing c. Active listening, cultural awareness, leadership, networking, political awareness d. Leadership, effective decision-making, active listening, and influencing

The Mazzanti Wholesale Food Company's fiscal year-end is June 30. The company issues quarterly financial statements requiring the company to prepare adjusting entries at the end of each quarter. Assuming all quarterly adjusting entries were properly recorded, prepare the necessary year-end adjusting entries at the end of June 30, 2016, for the following situations.

a. On December 1, 2020, the company paid its annual fire insurance premium of $6,800 for the year beginning December 1 and debited prepaid insurance.
b. On August 31, 2020, the company borrowed $107,500 from a local bank. The note requires principal and interest at 8% to be paid on August 31, 2021.
c. Mazzanti owns a warehouse that it rents to another company. On January 1, 2021, Mazzanti collected $25,600 representing rent for the 2021 calendar year and credited deferred rent revenue.
d. Depreciation on the office building is $18,600 for the fiscal year.
e. Employee salaries for the month of June 2021 $19,000 will be paid on July 20, 2021.

If you can buy a pack of candy bars 5.99 or a 2 pack 3.49,what is the unit cost for a bar in each case?

Use the information in each of the following separate cases to calculate the unknown amount. Corentine Co. had $171,000 of accounts payable on September 30 and $142,000 on October 31. Total purchases on credit during October were $300,000. Determine how much cash was paid on accounts payable during October. On September 30, Valerian Co. had a $112,000 balance in Accounts Receivable. During October, the company collected $112,390 from its credit customers. The October 31 balance in Accounts Receivable was $108,000. Determine the amount of sales on credit that occurred in October. During October, Alameda Company had $121,500 of cash receipts and $122,150 of cash disbursements. The October 31 Cash balance was $28,100. Determine how much cash the company had at the close of business on September 30.

Acme Inc. has 200 total employees, 150 of which are nonexcludable employees. Ten employees are highly compensated. Seven of the 10 highly compensated and 100 of the 140 nonhighly compensated employees are covered under Acme's qualified plan. The average accrued benefits for the highly compensated is 3% and the average accrued benefit for the nonhighly compensated is 1.5%. Which of the following statements is true regarding coverage? The Plan Passes the ratio percentage test. The plan passes the average benefits test. a. Both 1 and 2. b. 1 only. c. Neither 1 nor 2. d. 2 only.

Barton Steel is considering the purchase of a new steel mill. The first option is a top of the line high efficiency mill with a cost of $25 million. This mill will generate cash flows of $10 million per year for the next six years. At the end of the sixth year, Barton will have to reclaim the land under the new mill at a cost of $15 million. The second option is an economy mill that will generate $4 million in cash flows for the next six years, but require no land reclamation. This mill costs $12 million. If Barton estimates its cost of capital to be 9.5% which project should they accept

Firm A and B have identical business except that their financing is different: Firm A: EBIT = X = $10, D = $20 Firm B: EBIT = X = $10, D = $80 Suppose that corporate tax rate TC is 40%, cost of debt is RD is 10% for both. Please answer the following questions: Note: If your choice is A, then type in A. Do not type (A) or anything else. 1. Which firm has a greater FCF (free cash flow)? Your answer: (A) Firm A (B) Firm B (C) Both have the same FCF (D) Hard to say 2. What is firm A’s (annual) tax shield? Your answer: (A) $0 (B) $0.8 (C) $8 (D) $4 (E) Hard to say 3. What is firm B’s (annual) tax shield? Your answer: (A) $0 (B) $0.32 (C) $3.2 (D) $8 (E) Hard to say

The Hampton Inn in Stow, Ohio, has two sets of employees, the front desk staff and the housekeeping staff. There is always one front desk clerk on duty at all times, 24/7, and all of the front desk clerks make $8.00 an hour.The housekeeping staff is also paid $8.00 an hour, but they are paid for the number of hours that it takes them to clean the rooms in the hotel. Each room takes 30 minutes to clean, but if a room has not been used the night before, it does not have to be cleaned, so the housekeeping staff work fewer hours on days when the hotel is not as full.The hotel calculates its profitability on a per-room basis, since they have some costs that vary with the number of rooms that are occupied on a particular night. Right now, their costs other than staff wages are marketing expenses of $5,400 per month, management salaries of $60,000 per month, and general overhead (costs like utilities and insurance) of $30,000 per month.The hotel has 50 rooms, all of which rent for the same price per night.Assuming a 30-day month, what are the hotel’s total fixed costs per day? (Be careful, read all of the cost information carefully and think before you answer this question.)What is the hotel’s variable cost per room?If the hotel fills all of its rooms for the night, what price should they charge to break even?What price should they charge to break even with only 70% of the hotel’s rooms sold for the night?What price should they charge to earn a profit margin of 25% when 70% of the hotel’s rooms are sold for the night?

Dacosta Corporation had only one job in process on May 1. The job had been charged with $2,400 of direct materials, $6,966 of direct labor, and $10,104 of manufacturing overhead cost. The company assigns overhead cost to jobs using the predetermined overhead rate of $19.60 per direct labor-hour. During May, the following activity was recorded: Raw materials (all direct materials): Beginning balance $ 9,100 Purchased during the month $ 38,600 Used in production $ 39,900 Labor: Direct labor-hours worked during the month 2,500 Direct labor cost incurred $ 25,110 Actual manufacturing overhead costs incurred $ 33,900 Inventories: Raw materials, May 30 ? Work in process, May 30 $ 17,093 Work in process inventory on May 30 contains $3,849 of direct labor cost. Raw materials consist solely of items that are classified as direct materials. The cost of goods manufactured for May was:

Transactions that affect earnings do not necessarily affect cash. Identify the effect, if any, that each of the following transactions would have upon cash and net income.

a. Purchased $125 of supplies for cash.
b. Recorded an adjusting entry to record use of $45 of the above supplies.
c. Made sales of $1,220, all on account.
d. Received $850 from customers in payment of their accounts.
e. Purchased equipment for cash, $2,500.
f. Recorded depreciation of building for period used, $610.

Explain why each function is continuous or discontinuous. (a) The outdoor temperature as a function of longitude, latitude, and time is ---Select--- . Small changes in longitude, latitude or time can produce ---Select--- changes in temperature. (b) Elevation (height above sea level) as a function of longitude, latitude, and time is ---Select--- . Small changes in longitude, latitude, or time can produce ---Select--- changes in elevation. (c) The cost of a taxi ride as a function of distance traveled and time is usually ---Select--- . Small changes in distance traveled or time can produce ---Select--- changes in cost.

A company’s capital structure decisions address the ways a firm’s assets are financed (using debt, preferred stock, and common equity capital) and is often presented as a percentage of the type of financing used. As with all financial decisions, the firm should try to set a capital structure that maximizes the stock price, or shareholder value. This is called the optimal capital structure. Which of the following statements regarding a firm’s optimal capital structure is true? The optimal capital structure maximizes the firm’s cost of equity. The optimal capital structure maximizes the firm’s earnings per share (EPS). The optimal capital structure maximizes the firm’s cost of debt. The optimal capital structure minimizes the firm’s weighted average cost of capital.

Luca wants to identify and quantify the chemicals causing air pollution in a city, but he is using a manual air sampler to collect air samples.The density of gold is 19.3 g/cm3. What is the volume of a 13 g gold nugget? (Density: D = )

Causwell Company began 2021 with 12,000 units of inventory on hand. The cost of each unit was $5.00. During 2021 an additional 32,000 units were purchased at a single unit cost, and 22,000 units remained on hand at the end of 2021 (22,000 units therefore were sold during 2021). Causwell uses a periodic inventory system. Cost of goods sold for 2021, applying the average cost method, is $118,800. The company is interested in determining what cost of goods sold would have been if the FIFO or LIFO methods were used.

Required:
a. Determine the cost of goods sold for 2018 using the FIFO method.
b. Determine the cost of goods sold for 2018 using the LIFO method.

How do you choose the brainliest answer?

babysits on the weekends for extra money. Suppose that three neighbors with children are interested in paying Elizabeth to babysit their children. In​ particular, Mr. and Dr. Brown would be willing to pay ​$31 to have Elizabeth babysit their​ children, Mr. Smith would be willing to pay ​$28 for Elizabeth​'s babysitting​ services, and Professor Jones and Mr. Jones would be willing to pay ​$22 to have her watch their children. If Elizabeth offers to babysit each set of children for an evening for ​$22​, what will be consumer​ surplus, considering the three sets of children​ combined? ​$nothing. ​(Enter your response using an integer.​)

Mesa Company produces wooden rocking chairs. The company has two production departments, Cutting and Assembly. The wood is cut and sanded in Cutting and then transferred to Assembly to be assembled and painted. From Assembly, the chairs are transferred to Finished Goods Inventory and then are sold.

Mesa has compiled the following information for the month of February:

Cutting Department Assembly Department
Direct materials $150,000 $24,000
Direct labor 130,000 198,000
Applied manufacturing overhead 300,000 334,000
Cost of goods completed and transferred out 468,000 506,000

Required:
Prepare journal entries for the transactions in the Cutting and Assembly Departments of Mesa Company.

1.Record the transfer of materials to production in the Cutting department.
2. Record the cost of labor in the Cutting department.
3. Record the application of manufacturing overhead in the Cutting department.
4. Record the transfer of work in process inventory from Cutting to Assembly.
5. Record the transfer of materials to production in the Assembly department.
6. Record the cost of labor in the Assembly department.
7. Record the application of manufacturing overhead in the Assembly department.
8. Record the transfer of work in process inventory from Assembly to Finished Goods Inventory.