...5.17 | Q1, Q2, Q3Job costing, service sector Consider the following budgeted data for a client job of Bob Crachit’s accounting firm. The client wants a fixed price quotation. Direct professional labor | $20,000 | Direct support labor | 10,000 | Fringe benefits for direct labor | 13,000 | Photocopying | 2,000 | Telephone calls | 2,000 | Computer equipment | 6,000 | Overhead is allocated at the rate of 100% of direct labor cost.REQUIRED: | A. | Prepare a schedule of the budgeted total costs for the client. Show subtotals for total direct labor costs and total costs as a basis for markup. | | B. | Assume that the partner’s policy is to quote a fixed fee at 10% above the total costs. What fee would be quoted? | | C. | Explain why the listed estimates for costs might not be similar to the actual costs for the job. What factors could affect the accuracy of these estimates? List as many factors as you can. | | 6.55 | Q1, Q8Costs of workplace health and safety Britain’s Health and Safety Executive (HSE) is a national regulatory body overseeing workplace health and safety. In its 2007 performance report, HSE reported the following statistics: * 241 workers were killed at work. * 141,350 employees suffered serious injuries at work. * 2.2 million people were suffering from an illness they believed was caused or made worse by their current or past work. 646,000 of these were new cases in the last 12 months. * 36 million days were lost overall (1.5 days per...
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...ACC/543 Sample Questions for Midterm and Final Examinations The sample exam below is a representation of the Midterm and Final Examinations your students will take in Weeks Three and Six of this course. As in the sample exam below, the Midterm and Final Examinations will include questions that assess the course objectives. Although the sample exam contains one question per objective, the Midterm and Final Examinations will contain three questions per course objective. Refer to the questions in the sample exam below as a representation of the type of questions your students will be asked in the Midterm and Final Examinations. Refer your students to the weekly readings and content outlines for each week as study references for the final exam. The questions contained in the Sample Examination, Midterm and Final Examinations were selected from Operations Management for Competitive Advantage, Fundamental Financial & Managerial Accounting Concepts, and Business Law: Legal Environment, Online Commerce, Business Ethics, and International Issues. Week One: Managerial Accounting and Capital Budgeting Objective: Determine the present value of future cash flows from an investment. 1. Torvald's Hardware paid a contractor $45,000 to expand the store. The investment increased annual cash inflows by $8,000 per year six years. Torvald's has a desired rate of return of 10%. The net present value of this investment is which of the following? (round to the nearest dollar) A) ($10,160) ...
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...Capital Budget Recommendation for Guillermo Lynda D. Keller ACC543 June 23, 2014 Richard Collins Capital Budget Recommendation for Guillermo The first and most necessary goal of any organization is to maximize shareholder wealth. Maximizing shareholder wealth includes identifying and analyzing future projects that can provide value. Typically in a risk-return trade off the greater the risk, the higher the return. According to Krenz and Miller, “organizations undertake risky directions when the outcomes are so desirable that the probability of failure makes it worthwhile,” (Krenz & Miller, 2011, p. 18). Guillermo’s Furniture Store is facing increased competition, especially through consolidation of competitors. One option for Guillermo is to upgrade to current technology. This option is costly but can result in a substantial decrease in labor cost. Another option for Guillermo is to change the focus of his business from manufacturing to distribution using his existing distributor network. Keeping in mind that the main goal in capital budgeting is maximizing shareholder wealth managers will need to determine which projects will need to determine which projects will bring the largest return for the least amount of investment. In evaluating projects, there are many capital budgeting tools available to managers. These tools include net present value, weighted average cost of capital, and internal rate of return. According to a Duke University study, “75% of the...
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...Capital budget recommendation ACC543 September 9, 2013 Capital budget recommendation As an industry leader of furniture production in Sonora Mexico, Guillermo Furniture has enjoyed many years of success. This success can be attributed to many factors such as the inexpensive labor found in the region, the ability to price furniture at a premium due to the lack of competition, and the abundant supply of materials found in the area that were needed to produce products. However, new competition as well has a growth in the economy causing increased labor cost has caused the profit margins of Guillermo Furniture to shrink substantially. The need for a new business structure and model has emerged in order for Guillermo Furniture to continue enjoying success and again obtain comfortable profit margins. Capital investment decisions can be critical to the success or failure of a business. Understanding the process of capital budget evaluation techniques is therefore an important step to decision making. Two basic categories of techniques exist, techniques that consider the time value of money and techniques that ignore the time value of money the later producing less accurate results but being easier to understand and compute. The time value of money concept takes into account that the current value of a dollar that is received in the future is less valuable than it is if received today (Edmonds, Olds, McNair, Tsay, Schneider, & Milam, 2007). The two most common time value...
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...Capital Budget Recommendation By Sara Hinton ACC543 Professor Gayle Mackay July 17, 2012 Located in Sonora Mexico is a furniture company owned by one Guillermo Navallez called Guillermo Furniture Company. The Guillermo Furniture Company has had quite the success since opening, however in the late nineteen nineties this success began to waiver. The reason for such a change in success for the Guillermo Furniture Company is due to globalization. Due to the automation embraced by the company’s competitors, which has caused a reduction in profit margins as well as raise production costs for the Guillermo Furniture Company, there has been significant decline in business. Mr. Navallez is now faced with a plethora of decisions that may or may not dramatically change the way in which the Guillermo Furniture Company is operated. The accountant that has been hired by the Guillermo Furniture Company has been assigned to analyze capital budget techniques that will help determine which course of action should be taken by Mr. Navallez. This has been accomplished by not only examining capital budget techniques but through extensive research in understanding business alternatives available to the Guillermo Furniture Company as well. There are different business alternatives available to Mr. Guillermo Navallez. Like many of his competitors, Mr. Navallez has the option of merging his business with that of a larger company or he...
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...Employment Regulations Carl Newell ACC543 June 26, 2011 Tom Benscoter Employment Regulations The relationship between employer and employee is complex and involve numerous legal and ethical issues. It is imperative that employers be fully versed in the pertinent areas of employment law. The current issue is a prime example of this fact of life. Situation Review The company is involved in a legal dispute with a former contractor. The contractor was injured in route to a sales call in her personal vehicle and failed to attend the sales meeting. This resulted in the loss of the sale. Subsequently, the contractual relationship with the individual was terminated. The former contractor has sued the company alleging wrongful termination. Independent Contractor In Section 2 of the Restatement (Second) of Agency an independent contractor is defined as “a person who contracts with another to do something for him who is not controlled by the other nor subject to the other’s right to control with respect to his physical conduct in the performance of the undertaking.” (Cheeseman, 2007, p. 471). Labeling someone and independent contractor does not in make them one in fact. The degree of control the principal has over the agent determines the independent contractor status. In this case the salient issue is that the principal set the work hours and assignments for Beth. This indicates a high level of control and in general the courts have concluded that this is not an...
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