Posted: July 7th, 2016

What are the two primary ways for a company to finance its business?

1. Using the data in the attached file, prepare a schedule of total standard manufacturing costs for the 7,800 output units in January 2012.
2. For the month of January 2012, compute the following variances, indicating whether each is favorable (F)
or unfavorable (U):
a. Direct materials price variance, based on purchases
b. Direct materials efficiency variance
c. Direct manufacturing labor price variance
d. Direct manufacturing labor efficiency variance
e. Total manufacturing overhead spending variance
f. Variable manufacturing overhead efficiency variance
g. Production-volume variance

What are the two primary ways for a company to finance its business? Which would you choose if you were forming a corporation and trying to raise funds and why?

Your co-worker, Sam, tells you that he is going to purchase common stock in a new start-up company in hopes of seeing a big return on his investment. He tells you that he wouldn’t consider preferred stock because there is a very slim possibility of any type of large return. Explain why you agree or disagree.