Ralph's Auto Repair uses time and material pricing. The body shop, which anticipates 10,000 direct labor...
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Ralph's Auto Repair uses time and material pricing. The body shop, which anticipates 10,000 direct labor hours of activity, has the following data: Annual overhead costs: Material handling and storage Other overhead costs Annual cost of materials used Labor rate per hour, including fringe benefits. Hourly charge to achieve profit margin The time charge per hour is? $ 30,000 90,000 195,000 21.75 14.75 In 6 years, Hopkins Company plans to receive $9,200 cash from the sale of a machine that has a $5,000 book value. PV of an ordinary FV of $1 at 8% 1.080 FV of an ordinary annuity at 8% 1.000 PV of $1 at 8% 0.926 annuity at 8% 1.166 2.080 0.857 1.260 3.246 0.794 1.360 4.506 0.735 1.469 5.867 0.681 1.587 7.336 0.630 Year 1 2 3 4 5 6 0.926 1.783 2.577 3.312 3.993 4.623 If the firm is subject to a 30% income tax rate and has a(n) 8% after-tax hurdle rate, the correct discounted net cash flow would be: Ralph's Auto Repair uses time and material pricing. The body shop, which anticipates 10,000 direct labor hours of activity, has the following data: Annual overhead costs: Material handling and storage Other overhead costs Annual cost of materials used Labor rate per hour, including fringe benefits. Hourly charge to achieve profit margin The time charge per hour is? $ 30,000 90,000 195,000 21.75 14.75 In 6 years, Hopkins Company plans to receive $9,200 cash from the sale of a machine that has a $5,000 book value. PV of an ordinary FV of $1 at 8% 1.080 FV of an ordinary annuity at 8% 1.000 PV of $1 at 8% 0.926 annuity at 8% 1.166 2.080 0.857 1.260 3.246 0.794 1.360 4.506 0.735 1.469 5.867 0.681 1.587 7.336 0.630 Year 1 2 3 4 5 6 0.926 1.783 2.577 3.312 3.993 4.623 If the firm is subject to a 30% income tax rate and has a(n) 8% after-tax hurdle rate, the correct discounted net cash flow would be:
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To calculate the time charge per hour for Ralphs Auto Repair we need to determine the total overhead ... View the full answer
Related Book For
Managerial Accounting Creating Value in a Dynamic Business Environment
ISBN: 978-1259569562
11th edition
Authors: Ronald W. Hilton
Posted Date:
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