Answer:
The correct answers are letters "A", "B", "D" and "E".
Explanation:
A service system is a combination of Information Technology (IT) technologies and corporate networks that provide services to customers. Service systems have added values that differentiates and include the efforts of people in the operations. Online education programs are examples of service systems.
Manufacturing systems are the traditional organizations in which a product is created with the use of materials, labor, managerial support, and equipment to produce goods in organized and established cycles aiming to offer a product that satisfies consumers' needs.
Compared to manufacturing systems, service systems are intangible because even if people can make use of them, they are not physic; they cannot be inventoried since there is no specific form of measuring service systems by units; they cannot be patented because most service systems add value to already existing services with the use of technology; and, the process of providing the service is the product itself.
Service systems differ from manufacturing systems in several ways, particularly in that services can't be inventoried, they usually can't be patented, and the process of service delivery is often considered part of the product itself. Hence the correct option is (b, d).
Significant ways in which service systems differ from manufacturing systems include the fact that you cannot inventory service and the service itself cannot usually be patented. These characteristics highlight major differences between services and physical products.
In addition, the process of delivering the service is often considered part of the product in a service system. For instance, customer experience is integral to services delivery, unlike in manufacturing where the product and its manufacturing process are usually distinct.
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b. The WTO seeks to reduce remaining trade barriers through multilateral negotiations.
c. The WTO is headquartered in Belgium.
d. Existence of the WTO has allowed most member countries to replace their local currencies with a universal currency beginning in 2002.
Answer:
a) & b) are true. c) & d) are false.
Explanation:
WTO is an international (intergovernmental) organisation, supervising international trade between countries.
a) is true. It seeks to establish impartial procedures for resolving trade disputes among its members.
It seeks to reduce remaining trade barriers through multilateral negotiations, b) is true
c) is false. It is headquartered in Geneva, Switzerland (not Belgium)
d) is false. Existence of the WTO has allowed most member countries to replace their local currencies with a universal currency beginning in 2002. It is an international trade organisation, not monetary policy organisation.
Answer:
break-even level of revenues increases from $2,890,625 to $3,500,000
Explanation:
Break even point is the level of sales at which the company makes neither a Profit nor a loss.
Break -even Sales revenue = Fixed Cost / Contribution Margin Ratio
Old Break -even Sales revenue
Break -even Sales revenue = ( $800,000 + $125,000)/(1.00-0.68)
= $925,000/ 0.32
= $2,890,625
Old Break -even Sales revenue
Break -even Sales revenue = ( $600,000 + $100,000)/(1.00-0.80)
= $700,000/ 0.20
= $3,500,000
Answer:
The possible topics for writing a research paper:
Answer:
D. recorded as an indefinite-lived intangible asset, and annually tested for impairment.
Explanation:
In-process research and development acquired in a business combination is recorded as an indefinite-lived intangible asset, and annually tested for impairment.
In-process research and development costs are essential part of the financial income statement, it assist investors to make good, well-informed and tangible investment decisions in a newly acquired company.
D. Recorded as an indefinite-lived intangible asset, and annually tested for impairment, consistent with accounting standards for intangible assets.
In-process research and development (IPR&D) acquired in a business combination is accounted for as follows:
D. Recorded as an indefinite-lived intangible asset, and annually tested for impairment.
Here's why:
1. Indefinite-Lived Intangible Asset: IPR&D represents the value associated with ongoing research and development projects that have not yet reached the point of commercialization or technological feasibility. It is recognized as an indefinite-lived intangible asset because its future benefits are not constrained by a specific time period. This is in contrast to definite-lived intangible assets, which have a finite useful life and are subject to amortization.
2. Annual Impairment Testing: While IPR&D is initially recognized as an indefinite-lived asset, it is subject to annual impairment testing. This means that, at least annually, the company must assess whether there has been any impairment in the value of the IPR&D asset. If there is an indication that the asset's value has decreased (e.g., the research project is no longer viable or promising), an impairment charge is recorded to reduce the asset's carrying value to its recoverable amount.
3. Consistency with Accounting Standards: The accounting treatment of IPR&D acquired in a business combination is consistent with international accounting standards (e.g., IFRS) and generally accepted accounting principles (GAAP) in many jurisdictions. It reflects the economic reality that IPR&D represents valuable intellectual property that can contribute to the company's future profitability once successfully developed.
In summary, IPR&D acquired in a business combination is initially recognized as an indefinite-lived intangible asset, and it is subject to annual impairment testing to ensure its carrying value accurately reflects its recoverable amount based on its expected future benefits. This accounting treatment aligns with the treatment of other intangible assets and financial reporting standards.
For such more questions on intangible assets.
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Weight per engine 22 pounds
Order processing cost $125 per order
Inventory carry cost 20 percent of the average value of inventory per year
Assume that half of lot size is in inventory on average (1,000/2 = 500 units).
Two qualified suppliers have submitted the following quotations:
ORDER QUANTITY SUPPLIER 1 UNIT PRICE SUPPLIER 2 UNIT PRICE
1 to 1,499 units/order $510.00 $505.00
1,500 to 2,999 units/order 500.00 505.00
3,000 + units/order 490.00 488.00
Tooling costs $22,000 $20,000
Distance 125 miles 100 miles
Your assistant has obtained the following freight rates from your carrier:
Truckload (40.000 lbs. each load): $0.80 per ton-mile
Less-than-truckload: $1.20 per ton-mile
Required:
a. Calculate the total cost for each supplier.
b. Which supplier would you select?
c. If you could move the lot size up to ship in truckload quantities, calculate the total cost for each supplier.
d. Would your supplier selection change?
Answer:
a. Cost of Supplier 1 : $6,214,300 per year
Cost of Supplier 2 : $6,147,840
b. Supplier 2 will be selected as it costs $66,460 less than supplier 1.
c. 1,818
d. No.
Explanation:
Supplier : 1 ; 2
Unit price : $510 ; $505
Annual Purchase cost: $6,120,000 ; $6,060,000
One time cost: $22,000 ; $20,000
Orders per year: 12 , 12
Order processing cost: $1,500 ; $1,500
Inventory carrying cost: $51,000 ; $50,500
Distance: 125 ; 100
Weight per load: 22000
Transportation: $19,800 ; $15,840
Total Cost : $6,214,300 ; $6,147,840
Annual Purchase Cost = Demand * Units price
Orders per year = Demand / Lot size
Inventory Carrying cost = [ Lot size / 2 ] * Carrying cost * unit price
Order processing cost = Number of orders * order processing cost.
c. Required lot size for truck : 40,000 / 22 ≈ 1,818
To select a supplier for engines, the total cost for each supplier is calculated based on various factors such as order quantity, unit price, tooling costs, distance, freight rates, order processing cost, and inventory carry cost. Supplier 2 is selected as the preferred choice due to its lower total cost. If the lot size is increased to ship in truckload quantities, the total cost for both suppliers changes, but the supplier selection remains the same.
To calculate the total cost for each supplier, we need to consider the order quantity, unit price, tooling costs, distance, freight rates, order processing cost, and inventory carry cost. By multiplying the order quantity by the unit price and adding the tooling costs, we can calculate the total cost. For supplier 1, the total cost is $488,000 and for supplier 2, the total cost is $487,625. Considering the lower total cost, supplier 2 would be selected. If the lot size is increased to ship in truckload quantities, the freight rates will change. With a truckload rate of $0.80 per ton-mile, the total cost for supplier 1 becomes $486,650 and for supplier 2 becomes $486,794. Therefore, the supplier selection remains the same, with supplier 2 as the preferred choice.
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Employees – 29 40 31
Transactions 38,000 – 19,000 76,000
Department direct costs $ 350,000 $ 147,000 $ 950,000 $ 3,750,000
Allocate the cost of the service departments to the operating departments using the direct method.
Answer:
Administration Cost Allocated To Domestic is $197,183.
Administration Cost Allocated To International is $152,817.
Accounting Cost Allocated To Domestic is $29,400.
Accounting Cost Allocated To International is $117,600.
Explanation:
The Direct Method used for allocating Services Departments Cost to Operating Departments ignores the services used by service departments and allocate costs just to operating departments based on each department's consumption of allocation base. So, the costs of Administration and Accounting departments will be allocated to Domestic and International Departments.
Allocation of Administration Department Cost:
Domestic
Direct Cost of Administration * (No. of Employees in Domestic / Total No. of Employee in Operating Departments)
⇒ 350,000 * (40 / 71) = $197,183.
International
Administration Cost Allocated = 350,000 * (31 / 71) = $152,817.
Allocation of Accounting Department Cost:
Domestic
Direct Cost of Accounting * (No. of Transactions in Domestic / Total No. of Transactions in Operating Departments)
⇒ 147,000 * (19,000 / 95,000) = $29,400.
International
Accounting Cost Allocated = 147,000 * (76,000 / 95,000) = $117,600.