# AC 48 - Question If the expected return on xerox from the...

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Question: If the expected return on xerox from the capital asset pricing mocel (the CAPM) is 0.20, and if the risk free rate of interest is 0.05, and if the expected return on the market portfolio is 0.20, then which of the following comes closest to Xerox beta? a. 0.50 b. 1.50 c. 0.00 d. 1.00 Answer: As per CAPM, Expected return = R f + (R m - R f ) x Beta. So, 0.20 = 0.05 + (0.20 - 0.05) x Beta So, Beta = 1.00 So, option D is the correct option. Question:

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Answer: Standard labor hours allowed = 2,080 units x 3 hrs = 6,240 hours. So, Standard variable overhead per hour = Variable overhead budgeted / Standard hours allowed
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Unformatted text preview: = \$18,720 / 6,240 = \$3.00 per labor hour. So, in the above table, Variable overhead row will be 3 hours x \$3.00 = \$9.00 So, Standard unit cost = \$27 + \$42 + \$9 = \$78 Flexible budget for materials = Actual units x Standard input cost per unit = 2,600 x \$27 = \$70,200 Flexible budget for Labor = Actual units x Standard input cost per unit = 2,600 x \$42 = \$109,200 Flexible budget for Variable overhead = Actual units x Standard input cost per unit = 2,600 x \$9 = \$23,400...
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