Fast Manufacturers PLC have reconsidered their new project and the initial investment required of 1,000,000 is now 25% less than the original conception. The project will remain will have a three year life span and
have no scrap value.
However, this new conception has operating costs of 150,000 in year 1, and increasing by 5% due to inflation the following years. The gross revenue will also be higher across the board. The new project conception is forecasting a gross revenue of 525,000 in year 1 and again increasing with inflation 5% for years 2 and 3.
If the cost of capital has remained at 14%, should Fast Manufacturers PLC go ahead with the revised project?
Refer to the exhibit.
Which is the correct journal entry required to record a favourable material usage variance in an integrated accounting system?
The correct journal entry required to record a favourable material usage variance in an integrated accounting system is:
Refer to the exhibit.
The standard variable cost per unit of Product W is $26. The budgeted sales of Product W in April was 3,300 units. The company recorded the following variances for the month of April:
During April 3,600 units of Product W were actually sold.
What was the actual sales revenue for Product W in April?
Within a relevant range of output, the variable cost per unit of output will:
A company can increase its margin of safety by which of the following independent actions?
(a) Increasing sales and production
(b) Raising the selling price per unit
(c) Raising the variable cost per unit
(d) Lowering fixed costs
