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(a)
Concept introduction:
Direct Cost:
The cost which is directly related to the product and affects those items directly, which contributes to the revenue generation in the business is referred as direct cost.
Indirect Cost:
The cost which is not directly related to the product and does not affect those items directly, which contributes to the revenue generation in the business is referred as indirect cost. These can be fixed cost or such costs are incurred as a whole and cannot be make relation to
The reason behind increment in the cost per plaque.
(b)
Concept introduction:
Direct Cost:
The cost which is directly related to the product and affects those items directly which contributes to the revenue generation in the business is referred as direct cost.
Indirect Cost:
The cost which is not directly related to the product and does not affect those items directly which contributes to the revenue generation in the business is referred as indirect cost. These can be fixed costs or such costs are incurred as a whole and cannot be make relation to manufacturing cost.
The area of concern for HT on the basis of unit costs.
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Chapter 10 Solutions
Survey of Accounting (Accounting I)
- On January 1, 2023, Barber Corporation paid $1,160,000 to acquire Thompson Company. Thompson maintained separate incorporation. Barber used the equity method to account for the investment. The following information is available for Thompson’s assets, liabilities, and stockholders' equity accounts on January 1, 2023: Book Value Fair Value Current assets $ 130,000 $ 130,000 Land 75,000 193,000 Building (twenty-year life) 250,000 276,000 Equipment (ten-year life) 540,000 518,000 Current liabilities 26,000 26,000 Long-term liabilities 124,000 124,000 Common stock 233,000 Additional paid-in capital 389,000 Retained earnings 223,000 Thompson earned net income for 2023 of $134,000 and paid dividends of $51,000 during the year. If Barber Corporation had net income of $468,000 in 2023, exclusive of the investment, what is the amount of consolidated net income?arrow_forwardFirm this informationarrow_forwardGeneral Accountingarrow_forward
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