Value strings produces student-grade violins for beginning violin students. the company produced 2,500 violins in its first month of operations. at month end, 750 finished violins remained unsold. there was no inventory in work in progress. violins were sold for $122.50 each. total costs from the month are as follows: direct materials used: $125,000 direct labor: $50,000 variable manufacturing overhead: $32,000 fixed manufacturing overhead: $42,500 variable selling and administrative expenses: $8,000 fixed selling and administrative expenses: $12,100 the company prepares traditional (absorption costing) income statements for its bankers. value strings would also like to prepare contribution margin income statements for management use. compute the following amounts that would be shown on these income statements. 1. gross profit 2. contribution margin 3. total expenses shown below the gross profit line 4. total expense shown below the contribution margin line 5. dollar value of ending inventory under absorption costing 6. dollar value of ending inventory under variable costing 7. which income statement will have a higher operating income? by how much? explain.

Paar corporation bought 100 percent of kimmel, inc., on january 1, 2012. on that date, paar’s equipment (10-year life) has a book value of $420,000 but a fair value of $520,000. kimmel has equipment (10-year life) with a book value of $272,000 but a fair value of $400,000. paar uses the equity method to record its investment in kimmel. on december 31, 2014, paar has equipment with a book value of $294,000 but a fair value of $445,200. kimmel has equipment with a book value of $190,400 but a fair value of $357,000. the consolidated balance for the equipment account as of december 31, 2014 is $574,000. what would be the impact on consolidated balance for the equipment account as of december 31, 2014 if the parent had applied the initial value method rather than the equity method? the balance in the consolidated equipment account cannot be determined for the initial value method using the information given. the consolidated equipment account would have a higher reported balance. the consolidated equipment account would have a lower reported balance. no effect: the method the parent uses is for internal reporting purposes only and has no impact on consolidated totals.

Your father offers you a choice of $120,000 in 11 years or $48,500 today. use appendix b as an approximate answer, but calculate your final answer using the formula and financial calculator methods. a-1. if money is discounted at 11 percent, what is the present value of the $120,000?

Which of the following is a characteristic that can be used to guide the design of service systems? a. services cannot be inventoried. b. services are all similar. c. quality work means quality service. d. services businesses are inherently entrepreneurial. e. even service businesses have internal services.