BUS-187 Exam 4

AQ(AP - SP)

SP(AQ - SQ)

(AQ x AP) - (SQ x SP)

AH(AR - SR)

SR(AH - SH)

(AH x AR) - (SH x SR)

Actual Overhead - Overhead Applied

Variable Overhead + Fixed Overhead

Budgeted Overhead Costs ÷ Direct Labor Hours

Predetermined Overhead Rate x Standard Hours Allowed

Costs ---> Choose Lower Amount and State the Net Income Effect

Ex: DL, DM, Variable Manuf., Fixed Manuf., Purchase Price

Revenues - Costs ---> Choose Higher Net Income (or the one that isn't a Loss); State the Net Income Affect

*Don't include fixed costs when operating at the same of full plant capacity. If fixed costs do change, include the difference in the change, NOT total fixed costs. If there are no changes to fixed costs, you should assume that it stays the same.

Capital Investment ÷ Net Annual Cash Flow

Net Income + Depreciation Expense

Capital Investment ÷ # of Years

Depreciation Expense - Cumulative Net Cash Flow; That Answer ÷ the Next Year's Net Annual Cash Flow = Decimal Amount. Add Decimal Amount for # Between the Years for Cash Payback Period

Capital Investment ÷ (Total Net Income ÷ # of Years [Also Known as Net Annual Cash Flow]) = Cash Payback Period for Same Amount of Net Income

Discount Factor x Net Annual Cash Flow

Present Value - Capital Investment

Present Value of Net Annual Cash Flow - Capital Investment = Net Present Value; If the Net Present Value is positive, then the Investment should be made. If it is Negative, then the Investment should not be made.

Costs; Subtract Salvage Value from "Replace"; (Bracket) Costs in Net Income Effect, if larger than retain column. State the Net Income Effect

Actual > Standard

Actual < Standard

Costs; Net Income / Revenues

Table 1

Table 2; Use when period payments (receipts) are the same in each period.

Table 3; Use when periodic cash flows are uniform in each period. Ex.: Same Net Income + Depreciation (Net Annual Cash Flow)

Table 4; Use when periodic cash flows are not uniform in each period.

Principal (P) x Rate (i) = Time (n)

p x (1 + i)ⁿ

Future Value ÷ (1 + i)ⁿ