User Account

All Pages

What selling price should acme inc

Assignment Help Managerial Accounting
Reference no: EM133534132

Case Study: ACME Inc. has current assets of $450,000 and capital assets of $630,000. Its budgeted production volume for the next fiscal year is 200,000 units. Fixed costs are projected at $400,000 and variable unit costs for the one product produced total $5/unit. The company defines ROI as Operating Income/Total Assets and its required rate of return is 14%.

Required:

  • What selling price should ACME Inc. charge for its product if it wishes to achieve a 25% ROI? What is the operating income at this price?
  • The general manager for ACME Inc. receives a bonus equal to 12% of the residual income for the period. Calculate the amount of the bonus assuming the selling price calculated in part a).
  • Explain in your own word's advantages and disadvantages of ROI and Residual Income. Include your recommendations for the most appropriate method for calculating the bonus

 

Reference no: EM133534132

Questions Cloud

What is the importance of followership in this regard : What would be examples of how various theories support innovation and entrepreneurial spirit within organizations. What is the importance of followership
What is the accounts payable at the end of march : Estimate the purchases (in units) for the months of January through March. Estimate the cash disbursements on purchases for the months of January through March.
Reflect on ways that factors influence clinical presentation : Reflect on ways that these factors, or intersectionality, might influence clinical presentation, assessment, diagnosis, and/or treatment of PTSD.
What level of production will the make-versus-buy costs : what level of production will the make-versus-buy costs be equal? What are some of the qualitative factors the manager needs to consider with the relevant
What selling price should acme inc : What selling price should ACME Inc. charge for its product if it wishes to achieve a 25% ROI? What is the operating income at this price?
Do you think you can try method of test-retest reliability : You explained the assessment of validity very well and how each one of them has a function. Do you think you can try the method of test-retest reliability?
How will the competencies lead to your success : Choose which competencies you think relate best to the GCU Mission. How will these competencies lead to your success as a student and beyond?
What are your financial responsibilities when you drop class : What happens if you do not pass a class? What are your financial responsibilities when you drop a class or fail a class? What do you have as a backup plan?
Describe the three methods of allocating manufacturing : describe the three methods of allocating manufacturing overhead to products? What are the benefits of using an activity-based costing (ABC) system?

Reviews

Write a Review

Managerial Accounting Questions & Answers

  Manage budgets and financial plans

Explain the budgeting process and its importance to a business, identifying the components of different budgets, forecast estimates for inclusion in the budgets.

  Prepare a retained earnings statement

Prepare a retained earnings statement for the year and Prepare a stockholders' equity section of given case.

  Prepare a master budget for the three-month period

Prepare a master budget for the three-month period.

  Construct the companys direct labor budget

Construct the company's direct labor budget for the upcoming fiscal year, assuming that the direct labor workforce is adjusted each quarter to match the number of hours required to produce the forecasted number of units produced.

  Evaluate the predetermined overhead rate

Evaluate the Predetermined Overhead Rate

  Determine the company''s bid

Determine the company's bid if activity-based costing is used and the bid is based upon full manufacturing cost plus 30 percent.

  Compute the pool rates for the different activities

Complete the schedule to compute the pool rates for the different activities.

  Prepare Company financial statements

Prepare Company financial statements

  Prepare an analysis of terracycles

This individual assignment is based on the TerraCycle Inc.

  Discuss the ethical issues

Discuss the ethical issues

  Political resources in emerging markets

Calculate the GDP in Income Approach  and Expenditure Approach

  Management accounting - ehsan electronics company

A new plant accountant suggested that the company may be able to assign support costs to products more accurately by using an activity based costing system that relies on a separate rate for each manufacturing activity that causes support costs.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd