Answer: g W(7jFl
6i.!C5YX]
A: long-run growth rate =abBD
3*(1+10%) =3.3 million dxAP7
v
c"x-_Uk
B: target payout ratio <oP"kh<D4
Target payout ratio=3/15=20% ,[t>N>10TH
Dividend of 2008=18*2%=3.6 million 9]^ CDL
Y9_OkcW)
C: residual dividend approach cc_v 4d{x
Retained earnings=total new investment*(1-debt ratio) )/_T`cN
=12*(1-40%) pXBlTZf
=7.2 million @}B,l.Tj
Residual dividend=18-7.2=10.8 million EXD Qr'"
Lkl+f~m
D: regular-dividend-plus-extra dividend approach (according to the residual policy) dB%q`7O
Regular dividend=3*(1+10%) =3.3 million %tC3@S
Extra dividend=residual dividend –regular dividend i$bHet
=10.8-3.3 [>y 0Xf9^
=7.5 million iD-,C`
z=/xv},
s_`=ugue
2. N Company manufactures a kind of product used throughout the machinery industry. The standard price of the materials for the products is $6 per kilogram; the standard quantity of materials allowed per unit is 1.5 kilograms. During July, 2,000 units of the products were finished, for which 3,200 kilograms of materials were used at a total direct material cost of $18.560. bL9EX$P
A. Calculate the direct material price variance for July. Indicate whether it is favorable (F) or unfavorable (U) and who is generally responsible for this variance. ghu8Eg,Y
B. Calculate the direct material quantity variance for July. Indicate whether it is favorable (F) or unfavorable (U) and who is generally responsible for this variance. xHo
iu$i6
C. Calculate the total direct material cost variance for July. Indicate whether it is favorable (F) or unfavorable (U). ,OilGTQ#
=i:6&Y~VGq
Answer: 7B|
#*IZe
Notes: '"QN{ja
Actual price=18560/3200=$5.8/unit ="=Aac#n`
Actual quantity materials per unit=3200/2000=1.6 kg/unit }'
.k
]x<`(
1).Standard quantity * standard price=standard total cost ^:F |2
(1.5*2000) * 6 =$18000 m\O|BMHn
2). (Actual quantity-standard quantity) * Standard price= Efficiency variance of direct materials e6JT|>9A7
(3200-3000) * 6 =$1200 :2_8.+:
3)Actual quantity * (actual price- standard price)= Price variance of direct materials 4_'($FC1
3200 * (5.8 – 6) =$640 C%)Xz
4)actual quantity *actual price =actual total cost 1P1"x
T
3200 * 5.8 =$18560 ;[}<xw3):
P.Uz[_&l6
= ^OXP+o
A:Price variance of direct materials=(actual price-standard price)*actual quantity nC;2wQ6aO
= (5.8-6)*3200 Sy
?O(BMo
= $640 【F】 L@t}UC
Price variance of $640 【F】 due to the actual price of $5.8 per kg being fewer than the standard $6 per kg. K9 tuiD+j
0-!K@#$>=
B:Efficiency variance of direct materials= (actual quantity-standard quantity)*standard price /y~ "n4CK~
= (3200-3000)*6 1tMs\e-
=$1200 【U】 (g>>
yu>DVD
Efficiency variance of $1200 【U】 due to the higher quantity of materials per unit of 1.6 kg/unit than the standard level of 1.5 kg/unit. sVjM^y24
PIxd'B*MF
NrrnG]#p1
C:Total variance of direct materials=actual costs- standard cost zLB7'7oP
=18560-18000 zld[uhc>
=560 【U】