Answer:
WACC = 11.6%
Explanation:
The weighted average cost of capital (WACC) is the average cost of all the various sources of long-term finance used by a business weighted according to the proportion which each source of finance bears to the the entire pool of fund.
To calculate the weighted average cost of capital, follow the steps below:
Step 1: Calculate cost of individual source of finance
Cost of Equity= 13.5%
After-tax cost of debt:
= (1- T) × before-tax cost of debt
= 7%× (1-0.4)= 4.2%
Step 2 : calculate the proportion or weight of the individual source of finance . (This already given)
Equity = 80%
Debt= 20%
Step 3:Work out weighted average cost of capital (WACC)
WACC = ( 13.5%× 80%) + ( 4.2%× 20%) = 11.64%
WACC = 11.6%
On January 1, a company issues bonds dated January 1 with a par value of $620,000. The bonds mature in 3 years. The contract rate is 7%, and interest is paid semiannually on June 30 and December 31. The bonds are sold for $596,000. The journal entry to record the first interest payment using straight-line amortization is: Multiple Choice Debit Interest Expense $17,700; debit Discount on Bonds Payable $4,000; credit Cash $21,700. Debit Interest Payable $21,700; credit Cash $21,700. Debit Interest Expense $25,700; credit Discount on Bonds Payable $4,000; credit Cash $21,700. Debit Interest Expense $21,700; credit Premium on Bonds Payable $4,000; credit Cash $17,700. Debit Interest Expense $21,700; credit Cash $21,700.
Answer:
Debit Interest Expense $25,700; credit Discount on Bonds Payable $4,000; credit Cash $21,700.
Explanation:
The journal entry to record the first interest payment is given below:
Bond interest expense $25,700
To Discount on bond payable (($620,000 - $596,000) ÷ 6 years) $4,000
To Cash ($620,000 × 7% ÷ 2) $21,700
(being the first interest payment is recorded)
Here interest expense is debited as it increased the expense and credited the discount and cash as it decreased the liabilities and assets
6) Custom home operates three different departments. The company makes decorative comforters, pillowcases, and tablecloths in a small factory. The company expects to make 2,000 comforters during the current year. With respect to the comforters, how would the factory supervisory salaries be classified
Answer: B. Indirect and fixed
Explanation:
Direct costs in the production of 2,000 comforters would be those that were needed to convert the materials needed in the production to finished comforters such as clothing and assembly labor.
A factory supervisor is not directly involved in this process as their job is simply to monitor workers. They are therefore an indirect cost. The salaries do not change based on the level of production so these costs are fixed as well.
Purchasing-power parity holds between the nations of Ectenia and Wiknam, where the only commodity is Spam. a. In 2015, a can of Spam costs 4 dollars in Ectenia and 24 pesos in Wiknam. What is the exchange rate between Ectenian dollars and Wiknamian pesos
Answer:
the exchange rate between two different currency is 6 pesos per dollar
Explanation:
The computation of the exchange rate between two different currency is
= Unit cost of spam in Wiknam ÷ unit cost of spam in Ectenia
= 24 pesos ÷ 4 dollars
= 6 pesos per dollar
hence, the exchange rate between two different currency is 6 pesos per dollar
We simply applied the above formula so that the currency rate could come
And, the same is to be applied
Which precaution should you take while working on a computer?
A.
Hold the connecting wires and not plugs when connecting and disconnecting.
B.
Maintain a cool temperature to avoid sweating.
C.
Keep all the screws you remove in a container because you want to use them on any device.
D.
Leave wires loose because they allow proper circulation of air.
Answer:
D.
Leave wires loose because they allow proper circulation of air.
Answer:
B
Explanation:
100% on PLATO
Jenny has a $62,700 basis in her 50 percent partnership interest in the JM Partnership before receiving any distributions. This year JM makes a proportionate operating distribution to Jenny of a parcel of land with an $93,000 fair value and a $80,500 basis to JM. The land is encumbered with a $38,250 mortgage (JM's only liability). What is Jenny's basis in the land and her remaining basis in JM after the distribution
Answer:
$80,500 land basis, $1,325 JM basis.
Explanation:
Calculation to determine Jenny's basis in the land and her remaining basis in JM after the distribution
Based on the information given Jenny transferred basis in the land will be the amount of $80,500 while Her remaining basis in JM on the other hand will be the amount of $1,325 which is calculated as:
Predistribution basis in JM $62,700
Add deemed contribution $19,125
(50%*$38,250)
Less: basis allocated to land ($80,500)
Remaining basis in JM $1,325
Therefore Jenny's basis in the land and her remaining basis in JM after the distribution will be :$80,500 land basis, $1,325 JM basis.
ABC developed a new horse transport device and incurred research and development costs of $250,000. Rather than continue with their own research, ABC decided to purchase a patent for a similar design from Vail, Inc. for $350,000. What are the total assets and expenses for these developments
Answer:
Total Assets $350,000
Expenses $250,000
Explanation:
The company (ABC) has spent on research and development costs of $250,000. These costs are associated on the assets which are currently under development and benefit of which would be derived in the near future. Therefore, in the accounting treatment these costs will be recorded as expense.
The patent is considered as an intangible asset. This is due to the fact that they do not have any physical substance and provides benefit in the long run for the company who owns them. Their treatment in which case would be same as any intangible asset. ABC should treat the purchasing of patents as asset.
Hence, research and development costs incurred for new horse transport is expenses at $250,000 and the purchasing of patents would be recorded as an asset at $350,000.
[tex]A bond for J. Morris, Inc. a coupon rate of 6%. The yield to maturity is 7%. The bond has a remaining life of 20 years and makes semi-annual coupon payments? What is the present value of the bond s face value?[/tex]A bond for J. Morris, Inc. a coupon rate of 6%. The yield to maturity is 7%. The bond has a remaining life of 20 years and makes semi-annual coupon payments? What is the present value of the bond s face value?
Answer:
masjid DC jeans he shrugged egg kt
Explanation:
gggui it r ET UT yeah DJ it's CNN kf
at is Dantzler's horizon, or continuing, value? (Hint: Find the value of all free cash flows beyond Year 3 discounted back to Year 3.) Round your answer to two decimal places. Enter your answer in millions. For example, an answer of $13,550,000 should be entered as 13.55. $ fill in the blank 2 million What is the firm's value today? Round your answer to two decimal places. Enter your answer in millions. For example, an answer of $13,550,000 should be entered as 13.55. Do not round your intermediate calculations. $ fill in the blank 3 million Suppose Dantzler has $119 million of debt and 5 million shares of stock outstanding. What is your estimate of the current price per share? Round your answer to two decimal places. Write out your answer completely. For example, 0.00025 million should be entered as 250. $ fill in the blank 4
Answer:
a. Horizon Value = $856 million
b. Firm’s value today = Value of Firm = $641.61 million
c. Current Price per Share = $32.72
Explanation:
Note: This question is not complete. The complete question is therefore provided before answering the question as follows:
Dantzler Corporation is a fast-growing supplier of office products. Analysts project the following free cash flows (FCFS) during the next 3 years, after which FCF is expected to grow at a constant 7% rate. Dantzler's WACC is 12%.
Year FCF ($ millions)
0 -
1 -$18
2 $25
3 $40
a. What is Dantzler's horizon, or continuing, value? (Hint: Find the value of all free cash flows beyond Year 3 discounted back to Year 3.) Round your answer to two decimal places. Enter your answer in millions. For example, an answer of $13,550,000 should be entered as 13.55. million
b. What is the firm's value today? Round your answer to two decimal places. Enter your answer in millions. For example, an answer of $13,550,000 should be entered as 13.55. Do not round your intermediate calculations. million
c. Suppose Dantzler has $20 million of debt and 19 million shares of stock outstanding. What is your estimate of the current price per share? Round your answer to two decimal places. Write out your answer completely. For example, 0.00025 million should be entered as 250.
The explanation of the answers is now given as follows:
a. What is Dantzler's horizon, or continuing, value? (Hint: Find the value of all free cash flows beyond Year 3 discounted back to Year 3.) Round your answer to two decimal places. Enter your answer in millions. For example, an answer of $13,550,000 should be entered as 13.55. million
Horizon Value = Year 3 FCF * (100% + Constant growth rate) / (WACC – Constant growth rate) = $40 * (100% + 7%) / (12% - 7%) = $856 million
b. What is the firm's value today? Round your answer to two decimal places. Enter your answer in millions. For example, an answer of $13,550,000 should be entered as 13.55. Do not round your intermediate calculations. million
Value of Firm = (Year 1 FCF /(100% + WACC)^1) + (Year 2 FCF / (100% + WACC)^2) + ((Year 3 FCF + Horizon value) / (100% + WACC)^3)
Value of Firm = (-18/(100%+12%)^1+(25/(100%+12%)^2)+((856+40)/(100%+12%)^3))
Value of Firm = $641.61 million
c. Suppose Dantzler has $20 million of debt and 19 million shares of stock outstanding. What is your estimate of the current price per share? Round your answer to two decimal places. Write out your answer completely. For example, 0.00025 million should be entered as 250.
Current Price per Share = (Value of Firm – Debt) / Number of shares of stock outstanding = (641.61 - 20) / 19 = $32.72
Fees earned $942,135 Office expense 216,690 Miscellaneous expense 18,845 Wages expense 452,225 Accounts payable 23,555 Accounts receivable 65,950 Cash 252,875 Common stock 135,000 Land 301,000 Supplies 11,305 Cash dividends of $35,800 were paid during the year. Retained earnings as of June 1, 20Y5, were $254,000. Prepare the balance sheet as of May 31, 20Y6. When entering assets, enter them in order of liquidity.
Answer and Explanation:
The preparation of the balance sheet as on May 31, 20Y6 is as follows:
Assets
Cash $252,875
Accounts receivable $65,950
Supplies $11,305
Land $301,000
Total Assets $631,130
Liabilities
Accounts payable $23,555
Common Stock $135,000
Retained earnings (see working below) $472,575
Total Liabilities $631,130
Working note
For retained earnings first determine the net loss or net income as the case may be
= Fees earned - office expense - miscellaneous expense - wages expense
= $942,135 - $216,690 - $18,845 - $452,225
= $254,375
Now the ending retained earning balance is
= opening retained earning balance + net income - dividend paid
= $254,000 + $254,375 - $35,800
= $472,575
Innovation takes dedicated effort and resources, and organizations that are successful at it tend to be set up in ways that naturally foster innovation.
a. True
b. False
Answer:
a. True
Explanation:
Innovation is an essential concept for today's companies, which need to position themselves and stand out in a globalized and highly competitive market.
Therefore, it is correct to say that innovation is a strategy that companies use to develop their processes and organizational systems, in order to keep up to date with market and consumption patterns, exceeding the expectations of their stakeholders. Despite demanding continuous effort and resources, innovation starts to be naturally increased in the companies that develop it, because it impacts the organizational culture in a positive way, generating greater creativity, productivity and continuous improvement of all organizational processes, which impacts on the positioning of the company in the market and its profitability.
As nations learn to specialize in production, they will trade with other nations when what happens?
A) They have absolute advantage in trade.
B) They have comparative advantage in trade.
C) They will not trade with another country.
D) When they lose their advantage in that area of trade.
Answer:
the answer is B
Explanation:
Took the test wish me luck
What is the basic aim of the National Labor Relations Act?
A. Protecting workers' rights to organize and join a union
B. Requiring HR departments to engage in labor relations
C. Requiring employers to provide safe working conditions
D. Requiring employers to provide equal employment opportunity
Answer:
A - Protecting workers rights to organize and join a union
Explanation:
The general aim of the NLRA (National Labor Relations Act) was to protect workers from employers to revoke the rights of the employee to join or organize a union. Now, workers are able to freely join unions or organize them without being punished according to the NRLA.
Hope this helps.
Real estate property taxes generally range from 1 to 4 percent of the value of the home.
a. True
b. False
Answer:
true
Explanation:
it is true about the number of percentage
What are some of the ‘temptations’ a room attendant needs to resist when he/she has access to a guest’s room?
Touching any personal items, stealing, snooping, etc. are some of the ‘temptations’ a room attendant needs to resist when he/she has access to a guest’s room.
What is the role of the room attendant?To ensure that visitors have a pleasant and comfortable stay, room attendants are in charge of cleaning and maintaining guest rooms. They make sure that every room is welcoming and spotless, and they respond to all visitor inquiries courteously and intelligently. At a number of locations, including hotels, restaurants, parking garages, outdoor facilities, and retail stores, attendants carry out a range of customer support and service activities.
They help clients, offer information, and guarantee a well-run business. To make sure that guests are satisfied, we treat everyone with civility, respect, and a helpful, kind attitude. ensuring a high level of conduct in conformity with standardized rules. cleaning the staff housing areas as instructed by the housekeeper.
Learn more about room attendants here:
https://brainly.com/question/23271526
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The relationship between a product line and product mix is Multiple Choice there is no significant difference other than minor product variations of color, size, or form. product lines refer to consumer products; product mixes refer to business products. product lines include product mixes. product mixes refer to consumer products; product lines refer to industrial products. product mixes include product lines.
Answer:
product mixes include product lines.
Explanation:
The product line is a group of products that are interrelated as they satisfy the needs and also they are used together and are sold to the similar customer group via similar outlets
It involved the product line that are offered by the company
Therefore according to the given situation, last one is correct answer
And, the same would be relevant
Use the following information to answer the next two questions: On January 1, 2018, Jimbo Enterprises purchased new equipment for its training center. The equipment cost $220,000. Jimbo paid $25,000 down and is required to pay the rest in semiannual installments for the next 8 years. Jimbo's cost of borrowing is 4%.
Required:
a. What is the amount of the semiannual payment Jimbo will make every six months?
b. What is the total amount of interest expense Jimbo will pay over the life of the loan?
Answer:
total loan (PV) = $220,000 - $25,000 = $195,000
n = 8 x 2 = 16
rate = 4% / 2 = 2%
FV = 0
Using a financial calculator, the payment = $14,361.77
Total amount of money paid during the 8 years = $229,788.39
Total interests paid = $229,788.39 - $195,000 = $34,788.39
Cye is the sole owner of Sports World Enterprises. The company earned net operating income of $85,000 during 2018 and had a LTCL of $12,000. He withdrew $40,000 of the profit from Sports World during the year. How should he report this information if Sports World each of the following entity types (ignore the qualified business income deduction):
a. A sole proprietorship?
b. A C-Corp?
c. An S-Corp?
Answer:
Sports World Enterprises
Reporting of this information as:
a. A sole proprietorship:
Business income = $85,000
Long-term Capital Losses $12,000
Limit allowed for the year = $3,000
Personal Taxable Income = $82,000
b. A C-Corp:
Net operating income = $85,000
Long-term Capital Losses (LTCL) = $12,000
Corporate Taxable Income = $73,000
Personal Taxable Income = $40,000
c. An S-Corp:
Business income = $85,000
Long-term Capital Losses $12,000
Personal Taxable income = $73,000
Explanation:
a) Data and Calculations:
Net operating income = $85,000
Long-term Capital Losses (LTCL) = $12,000
Drawings for personal use = $40,000
b) A sole proprietorship is a business entity owned by one person. It does not enjoy separate legal existence from the owner. All income from different sources are aggregated and taxed at the individual tax rate.
c) A C-Corporation is a legal entity that is separate from the owner(s). Its income is taxed at the corporate rate before distribution to the owner(s). The distributed income to the owner(s) is also taxed at the individual tax rate.
d) An S-Corporation, while it enjoys a separate legal existence, is a special form of a corporation, whereby the earnings are passed through the owners and are taxed at the individual tax rate.
Three months ago, CSG stock was selling for $44.25 a share. At that time, you purchased three put options on the stock with a strike price of $45 per share and an option price of $1.75 per share. The option expires today when the value of the stock is $42.50 per share. What is your net profit or loss on this investment
Answer:
$225
Explanation:
Calculation to determine your net profit or loss on this investment
Using this formula
Net profit or Loss= (Strike price - Value of stock at expiration - Premium paid) x 3 x 100
Let plug in the formula
Net profit or Loss= ($ 45 - $ 42.50 - ß) x 300
Net profit or Loss= $ 225
Therefore your net profit on this investment is $225
The aggregate demand curve is downward sloping because as the price level increases the purchasing power of wealth decreases purchasing power of wealth decreases A demand for imports decreases demand for imports decreases B demand for interest-sensitive expenditures increases demand for interest-sensitive expenditures increases C demand for domestically produced substitute goods increases demand for domestically produced substitute goods increases D real value of fixed assets increases
Answer:
A
Explanation:
The aggregate demand curve is a graph that represents the total quantity of all goods and services demanded by the economy at different price levels.
The aggregate demand curve slopes downward because
wealth effect on consumptionthe interest rate effect on investmentthe international trade effect on net exports.If price level decreases, wealth decreases. As a result, import becomes more expensive and export decreases. This leads to a downward slope of the demand curve
Consider the economy of Czech Republic and suppose relative PPP and the quantity theory of money hold. Suppose you expect the rate of money growth of Czech Republic in the 2021 to be around 4% while your forecast for its real GDP growth is at 1%. Suppose inflation in the UK is expected to be at 2%. Currently, Czech National bank has a floating exchange rate.
Required:
Calculate inflation in Czech Republic.
Answer:
3%
Explanation:
Calculate the inflation in Czech Republic
Expected Rate of money growth of Czech republic in 2021 = 4%
Forecast for real GDP growth = 1%
we will use the Monetary approach to calculate inflation in Czech
Using QTM: M+V = P+Y ( M = 4% , Y = 1% ) assume change in V = 0
P ( inflation ) = 4% - 1% = 3%
IKEA has essentially changed the way people shop for furniture. Discuss the pros and cons of this strategy, especially as the company plans to continue to expand in places like Asia and India.
Answer:
um
Explanation:
The following lots of Commodity Z were available for sale during the year. Beginning inventory 8 units at $50 First purchase 19 units at $51 Second purchase 51 units at $57 Third purchase 15 units at $57 The firm uses the periodic system, and there are 25 units of the commodity on hand at the end of the year. What is the ending inventory balance at the end of the year according to the LIFO method
Answer:
The ending inventory balance at the end of the year according to the LIFO method is $1,267.
Explanation:
The Last-In, First-Out (LIFO) method is an inventory method under which the last unit to arrive in inventory is assumed to be sold first.
Since the firm uses the periodic system under which the inventory account is updated at the end of the accounting period, we have:
Ending inventory balance = 8 units at $50 from the beginning inventory + 17 units at $51 per units from the First purchase = (8 * $50) + (17 * $51) = $1,267
5 Julie is having a hard time convincing her husband, Eric, to do a budget. His income is $35,000, but he also works a part-time job so he has extra spending money. They have credit card debt and some minor medical bills. Julie wants to get out of debt, but Eric thinks that everything is fine. Julie calls Dave on the air to discuss her situation. What does Dave tell her
they need to do need analysis of what they want and go through their budget
Explanation:
he needs to analyse the expenses, income,the balance their are left with
In June 2019, the average price of a cup of coffee in Venezuela was 6,500 bolivars; in June 2018, the average price was just 8 bolivars. This represents an 81,150% increase in the price of a cup of coffee for Venezuelans, who have seen similarly dramatic increases in the prices of nearly everything they buy. How might this experience of inflation impact inflation going forward
Answer:
d. causes inflation expectations to rise, which in turn causes still higher inflation
Explanation:
Missing word "Higher inflation: a. makes most goods and service unaffordable, causing a decrease in demand that leads to falling prices, b. creates a price bubble that ultimately bursts, causing the prices of most goods and services to fall, c. causes inflation expectations to fall, which in turn causes inflation to fall d. causes inflation expectations to rise, which in turn causes still higher inflation"
This inflation experience will most likely will continue increase using the experience as yardstick and this will be a case of hyper inflation where the inflation rates are so high that is goes out control in economic perspective. In hyper-inflation situation, prices of goods and services may increase and continue to do in hourly basis.
The following labor standards have been established for a particular product: Standard labor hours per unit of output 4.3 hours Standard labor rate $ 17.80 per hour The following data pertain to operations concerning the product for the last month: Actual hours worked 6,300 hours Actual total labor cost $ 112,770 Actual output 1,400 units Required: a. What is the labor rate variance for the month
Answer:
See below
Explanation:
With regards to the above, labor rate variance is computed as;
Direct labor rate variance = (Standard rate - Actual rate) × Actual quantity
Given that;
Standard labor rate per hour = $17.8
Actual hours worked = 6,300
Actual total labor cost = $112,770
Actual rate = $112,770/6,300 = $17.9
Therefore,
Direct labor rate variance = ($17.8 - $17.9) × 6,300
= $630 unfavourable
Sasha is a healthcare provider who learns that one of her patients has strict beliefs about certain medications, and is refusing them. Sasha makes sure her patient is not given any of those medications, and visits the patient to discuss any other healthcare preferences.
Based on this information, what could be concluded about Sasha’s behavior?]
Sasha is afraid that her patient will act violently if his requests are not honored.
Sasha is prejudiced against patients from foreign countries.
Sasha is practicing holistic care.
Sasha is treating the patient more kindly than she treats other patients.
Answer: Sasha is practicing holistic care.
Explanation:
Based on the information given, we can conclude that Sasha is practicing holistic care.
Holistic care simply means caring for patients based on the mutual understanding regarding the emotional, physical, and psychological dimensions.
Holistic care us important in order to make patients recover quickly. In this case, Sasha wants to know the preference of the patients in order to lead her to recovery and not compound to the patient's issues.
After graduation, you decide to go into a partnership in an office supply store that has existed for a number of years. Walking through the store and stockrooms, you find a great discrepancy in service levels. Some spaces and bins for items are completely empty; others have supplies that are covered with dust and have obviously been there a long time. You decide to take on the project of establishing consistent levels of inventory to meet customer demands. Most of your supplies are purchased from just a few distributors that call on your store once every two weeks. You choose, as your first item for study, computer printer paper. You examine the sales records and purchase orders and find that demand for the past 12 months was 5,000 boxes. Using your calculator you sample some days' demands and estimate that the standard deviation of daily demand is 10 boxes. You also search out these figures:
Cost per box of paper: $11.
Desired service probability: 98 percent.
Store is open every day.
Salesperson visits every two weeks.
Delivery time following visit is three days.
Using your procedure, how many boxes of paper would be ordered if, on the day the salesperson calls, 60 boxes are on hand?
Answer:
257 boxes
Explanation:
The computation is given below;
Daily Demand would be
= 5000 ÷ 365
Standard Deviation = 10 boxes
Lead Time = 2 Weeks + 3 Days = 17 Days
Service Level = 0.98
Reorder Point = avg(d) × LT + z × σd × sqrt(LT)
= 5000 ÷ 365 × 17 + 2.05 × 10 × 170.5
= 317
So, the number of boxes should be ordered is
= 317 - 60
= 257 boxes
Payroll Taxes Champaign Inc., a company that provides educational consulting services to large universities across the nation, has a gross payroll of $62,000 for the pay period. The entire payroll is subject to Social Security and Medicare taxes. Champaign must also withhold $7,440 in federal income tax from the employees and pay state unemployment tax of $75. Assume that the Social Security tax rate is 6.2%, and Medicare tax rate is 1.45%.
Required:
Provide the necessary journal entries for Champaign to record these payroll taxes (round to nearest penny).
Answer:
Date Account Title Debit Credit
XX-XX Wages Expense $62,000
Federal Income Tax Withholding Payable $7,440
Social Security Taxes Payable (Employee) $3,844
Medicare Taxes Payable (Employee) $ 899
Cash $49,817
Working
Social Security Taxes Payable (Employee) = 6.2% * 62,000 = $3,844
Medicare Taxes Payable (Employee) = 1.45% * 62,000 = $899
Date Account Title Debit Credit
XX-XX Social Security Taxes Expense (Employer) $3,844
Medicare Taxes expense (Employer) $899
State Unemployment tax expense $75
Social Security Taxes Payable (Employer) $3,844
Medicare Taxes Payable (Employer) $899
State Unemployment tax Payable $75
Marco works as a freelance science writer. He wants to improve his productivity. Which of the following steps is he most likely to take? (5 points)
Group of answer choices
Build a website highlighting his expertise and publications
Take a week off to relax and play video games
Invest in a better computer and a faster Internet connection
Take out an advertisement for his services
Answer:
its c and dont remove it this time eroupa
Explanation:
Assume the following: The standard price per pound is $2.00. The standard quantity of pounds allowed per unit of finished goods is 4 pounds. The actual quantity of materials purchased and used in production is 50,000 pounds. The actual purchase price per pound of materials was $2.25. The company produced 13,000 units of finished goods during the period. What is the materials spending variance
Answer:
Direct material price variance= $12,500 unfavorable
Explanation:
Giving the following formula:
The standard price per pound is $2.00.
The actual quantity of materials purchased and used in production is 50,000 pounds.
The actual purchase price per pound of materials was $2.25.
To calculate the direct material price (spending) variance, we need to use the following formula:
Direct material price variance= (standard price - actual price)*actual quantity
Direct material price variance= (2 - 2.25)*50,000
Direct material price variance= $12,500 unfavorable
