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Tuesday, January 26, 2010
Solution to MGT101
solution of MGT 101 can be downloaded from this link :
http://www.4shared.com/file/207738713/25f8a2e1/MGT_101_SOLUTION.html
http://www.4shared.com/file/207738713/25f8a2e1/MGT_101_SOLUTION.html
solution to MGT402
MGT 402 – COST AND MANAGEMENT
ACCOUNTING
1- Units stared and completed during January:
Total units transferred to the next department 60,000
Less: unit in the January 01 inventory 10,000
Units started and completed in January 50,000
2- Equivalent units:
= Units transferred to next department + Completed portion of W.I.P inventory
Material Cost:
= 60,000 + 8,000 x 75%
= 60,000 + 6,000
= 66,000 units
Conversion Cost:
= 60,000 + 8,000 x 50%
= 60,000 + 4,000
= 64,000 units
3- Costs per equivalent unit for January:
Material cost per unit:
= Material cost / Equivalent units of materials cost
= (18,000 + 114,000) / 66,000
= 132,000 / 66,000
= £ 2.00 per units
Conversion cost per unit:
= Conversion cost / Equivalent units of Conversion cost
= (8,800 + 61,600) / 64,000
= 70,400 / 64,000
= £ 1.10 per units
Total per unit cost:
Material cost per unit + Conversion cost per unit
= 2.00 + 1.10
= £ 3.10 per units
4-The ending work in process inventory figure is verified as:
Material cost £ 12,000
(8,000 x 75% x 2)
(6,000 x 2.00)
Conversion cost 4,400
(8,000 x 50% x 1.10)
(4,000 x 1.10)
Total W.I.P inventory £ 16,400
5-
The FIFO method is superior because current performance should be measured in relation
to costs of the current period only. And the weighted – average method mixes these costs
in with costs of the prior period. Unit costs are influenced to some extent by what
happened in a prior period. This problem becomes particularly significant when
attempting to measure performance in the current period. Good or bad cost control in the
current period might be concealed to some degree by the costs that have been brought
forwarded in the beginning inventory.
solution to ECO401
ECONOMICS
Question 01
A firm pays in cash $250000 in wages, $55430 in interest on borrowed money capital and $74320 for the yearly rental of its factory building. If the entrepreneur worked for somebody else as a manager, he would earn at most $44500 per year and if he lent out his money capital to somebody else in a similarly risky business, he would at most receive $16600 per year. Keeping in view the above information:
(A) Calculate:
a) The explicit cost of the firm.
b) The implicit cost of the firm.
c) The total cost of the firm.
(B) If the entrepreneur received $495680 from selling his years output, then calculate his total profit.
(C) What will be the total profit if the entrepreneur’s total revenue were $413934 instead?
ANSWER:
(A)
a. Explixit cost of the firm:
Explicit cost = $25,000+$74320
= $324,320
b. Implicit cost of the firm:
Implicit cost = $44500+$16600
= 61,100
c. Total cost:
Total cost = explicit+implicit
= $324320+$61100
= $385420
(B) TOTAL PROFIT:
Profit=Revenue-Cost
= $495680-$385420
= $ 110260
(D) TOTAL PROFIT:
Profit= $413934-$385420
=$28514
Ans
Question 02
(A) Find the value of multiplier if:
a) MPC = 0.39
b) MPS = 0.64
(B) If the value of multiplier is 2.49 then find out:
a) MPC
b) MPS
(C) What is the relationship between the value of multiplier and MPC?
(D) Find the change in equilibrium level of output when there is a $25 increase in investment spending and the MPC is 0.75.
ANSWER:
A. Value of multilpier:
a. Mpc=0.39
K=1/1-mpc
=1/1-0.39
=1/0.61
=1.6
b. Mps=0.64
K=1/mps
=1/0.64
=1.56
B.
a. K=2.49 , Mpc=?
K=1/1-mpc
2.49(1-mpc0=1
2.49-2.49mpc=1
2.49-1=2.49mpc
1.49=2.49mpc
Mpc=0.6
b. K=2.49 mps?
K=1/mps
2.49=1/mps
2.49(mps)=1
Mps=0.40
C. RELATIONSHIP BETWEEN THE VALUE OF MULTILPER AND MPC:
k is strong when mpc increase
Or k is weak when mpc is decrese
K=more than 1 and less than infinity
MPC=less than 1 more than 0
D. CHANGE IN EQUILBRIUM LEVEL OF OUTPUT:
If the invest is increase 25 the change in equilibrium level of output will increase.if mpc=0.75 will be stronger
Question 01
A firm pays in cash $250000 in wages, $55430 in interest on borrowed money capital and $74320 for the yearly rental of its factory building. If the entrepreneur worked for somebody else as a manager, he would earn at most $44500 per year and if he lent out his money capital to somebody else in a similarly risky business, he would at most receive $16600 per year. Keeping in view the above information:
(A) Calculate:
a) The explicit cost of the firm.
b) The implicit cost of the firm.
c) The total cost of the firm.
(B) If the entrepreneur received $495680 from selling his years output, then calculate his total profit.
(C) What will be the total profit if the entrepreneur’s total revenue were $413934 instead?
ANSWER:
(A)
a. Explixit cost of the firm:
Explicit cost = $25,000+$74320
= $324,320
b. Implicit cost of the firm:
Implicit cost = $44500+$16600
= 61,100
c. Total cost:
Total cost = explicit+implicit
= $324320+$61100
= $385420
(B) TOTAL PROFIT:
Profit=Revenue-Cost
= $495680-$385420
= $ 110260
(D) TOTAL PROFIT:
Profit= $413934-$385420
=$28514
Ans
Question 02
(A) Find the value of multiplier if:
a) MPC = 0.39
b) MPS = 0.64
(B) If the value of multiplier is 2.49 then find out:
a) MPC
b) MPS
(C) What is the relationship between the value of multiplier and MPC?
(D) Find the change in equilibrium level of output when there is a $25 increase in investment spending and the MPC is 0.75.
ANSWER:
A. Value of multilpier:
a. Mpc=0.39
K=1/1-mpc
=1/1-0.39
=1/0.61
=1.6
b. Mps=0.64
K=1/mps
=1/0.64
=1.56
B.
a. K=2.49 , Mpc=?
K=1/1-mpc
2.49(1-mpc0=1
2.49-2.49mpc=1
2.49-1=2.49mpc
1.49=2.49mpc
Mpc=0.6
b. K=2.49 mps?
K=1/mps
2.49=1/mps
2.49(mps)=1
Mps=0.40
C. RELATIONSHIP BETWEEN THE VALUE OF MULTILPER AND MPC:
k is strong when mpc increase
Or k is weak when mpc is decrese
K=more than 1 and less than infinity
MPC=less than 1 more than 0
D. CHANGE IN EQUILBRIUM LEVEL OF OUTPUT:
If the invest is increase 25 the change in equilibrium level of output will increase.if mpc=0.75 will be stronger
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