unit) Skis Boots parkas Historical cost $190 $106 $53 Selling price 212 145 73.75 Cost to distribute 19 8 2.50 Current replacement cost 203 105 51 Normal profit margin 32 29 21.25 Determine the following: a) the two limits to market value (i.e., the ceiling and the floor)that should be used in the lower-of-cost-market computation for risk, b) the cost amount that should be used to value the lower-of-cost-or-market comparison of boots, and c) the market
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is a publicly traded company, which operates in the unbranded market segment. It is a manufacturer and distributor of non-fashion casual knitwear. The main business comes in from Wholesalers and Retail Channels. Recently, the company has been able to take advantage of low production costs through their state-of-the-art offshore production facility, established in the Dominican Republic. Due to Classic Knitwear’s moderate cost advantage over other US producers, rival companies such as JamesBrands and
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CHAPTER 16 COST ALLOCATION: JOINT PRODUCTS AND BYPRODUCTS 161 Exhibit 161 presents many examples of joint products from four different general industries. These include: Industry Separable Products at the Splitoff Point Food Processing: • Lamb • Lamb cuts, tripe, hides, bones, fat • Turkey • Breasts, wings, thighs, poultry meal Extractive: • Petroleum • Crude oil, natural gas 162 A joint cost is a cost of a production process that yields multiple products simultaneously
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3. Do products or services have a larger gross profit margin in 2014? Show your calculations. Products gross profit margin:(Revenue-COGS)/Revenue=(73,726,000,000-56,469,000,000)/73,726,000,000=0.234 Services gross profit margin:(37,327,000,000-28,093,000,000)/37,327,000,000=0.247 4. If the trends in question 3 persist, what do your answers to question 2 and 3 suggest about likely changes in the overall gross profit margin for HP in 2014? With this information all
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Competition Bikes. The cost of goods sold increased $1,048,000. This was a 31.8% increase. The fact that net sales increased by 33.3%, and cost of goods sold increased by only 31.8% was a significant factor in these two years. This was a positive result, because net sales increased more than what the cost of goods sold increased. Competition Bikes found a way to sell more bikes at a lower cost for the company. This is why the company had an increase of 37.5% in gross profit. Selling Expenses Total
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They are: (1) balance sheets; (2) income statements; (3) cash flow statements; and (4) statements of shareholders’ equity. Balance sheets show what a company owns and what it owes at a fixed point in time. Income statements show how much money a company made and spent over a period of time. Cash flow statements show the exchange of money between a company and the outside world also over a period of time. The fourth financial statement, called a “statement of shareholders’ equity,” shows changes in the
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not surprising because the company was going through a restructuring phase. There sales are then projected to increase to $870,000,000 in 2005, this would be an increase of around 6.5%. This projection can be contributed to the company’s new Artificial Workforce products. The company expected domestic revenues from these products to total $90M in 2005 and $150M in 2006. They had also expected to receive $150M in revenue from international sales by 2007. The companies cost of sales has dropped in both
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different subgroups: profit ratios, liquidity ratios, activity ratios, leverage ratios, and shareholder-return ratios. These ratios should be compared with the industry average or the company's prior years of performance. It should be noted, however, that deviation from the average is not necessarily bad; it simply warrants further investigation. For example, young companies will have purchased assets at a different price and will likely have a different capital structure than older companies. In addition
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Comparative Income Statements Auto Wash Bot Ltd. & Popeye’s Muscle Wash Ltd. (for the year ended December 31, 2015) | Auto Wash Bot Ltd. | Popeye’s Muscle Wash Ltd | Revenue | 375,000 | 375,000 | Cost of Goods Sold | 86,250 | 163,125 | Gross Profit | 288,750 | 211,875 | Other Expenses: | | | Advertising | 35,400 | 5,200 | Office Expense | 22,750 | 17,400 | Research | 195,000 | | Repairs & Maintenance | | 85
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E5-11 a) Compute Payton's gross profit. GROSS PROFIT = 900,00 - 540,000 = $ 360,000 ______________________________________ b) Compute the gross profit rate. Why is this rate computed by financial statement users? (360,000/900,000)/100 = 4/10of 100 = 40% This is known as the GROSS PROFIT MARGIN. ______________________________________ c) What is Payton's income from operations and net income? 1)Income from Operations = 360,000 - 230,000 = $130,000. 2)Net Income = 130,000 - 11,000
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