Answer:
$136,000
Explanation:
According to the scenario, computation of the given data are as follows,
Amount receivable = $160,000
Allowance for sales return = 10% × $160,000 = $16,000
Commission = 5% × $160,000 = $8,000
So, amount of cash from factored receivables can be calculated by using following formula,
Cash from factored receivables = Amount receivable - Allowance for sales return - Commission
= $160,000 - $16,000 - $8,000
= $136,000
g Last year Lexington had sales of $884,000 and paid taxes of $50,000. Because of the low interest rate environment, the firm also borrowed some money from the local bank and paid $36,000 in interest expense. In addition, the firm incurred Variable Costs and Fixed Costs of $447,000 and $400,000 respectively. If sales increase by 5%, what should be the increase in earnings per share
Answer:
Lexington
The increase in earnings per share is 44.59%.
Explanation:
a) Data and Calculations:
Last Year 5% increase
Sales revenue $884,000 $928,200
Variable costs 447,000 469,350
Contribution $437,000 $458,850
Fixed costs 400,000 400,000
Operating income $37,000 $58,850
Interest expense 36,000 36,000
Income before tax 1,000 22,850
Income taxes 50,000 50,000
Net loss $49,000 $27,150
Increase = 44.59% ($21,850/$49,000 * 100)
When the interest rate is above the equilibrium level, a. the quantity of money that people want to hold is less than the quantity of money that the Federal Reserve has supplied. b. people respond by buying interest-bearing bonds or by depositing money in interest-bearing bank accounts. c. bond issuers and banks respond by lowering the interest rates they offer. d. All of the above are correct.
Answer:
D
Explanation:
When interest rate is above the equilibrium level, people would be less willing to hold cash. Instead they would prefer to save or invest in interest-bearing bonds. This is because as a result of the higher interest rate, interest paid on their deposit and investment would be higher.
As a result of the increase in savings, there would be an increase in the supply of loanable funds over demand for loanable funds. This would lead to a reduction in interest rate until equilibrium interest rate is reached.
SAP Inc. received a $1.5 million grant under its Small Business Innovation program. SAP invested the grant money and developed a system to remove metal contaminants from storm water in shipyards. The firm estimates that each shipyard spends $500,000 a year on storm water clean-up efforts. If SAP is able to sign up and retain four shipyards in the first year onwards, what is the present value (PV) of the project (net of investment) if the cost of capital for SAP is 14% per year
Answer: $12,785,714
Explanation:
Present value of project:
= Revenue / Cost of capital
= (500,000 * 4 shipyards) / 14%
= $14,285,714
Net of investment:
= 14,285,714 - 1,500,000
= $12,785,714
Principal Printing produces custom labels and stationery for companies. In conducting CVP analysis of its Personalized Package, management decided to determine how many of the packages would need to be sold in order to justify continuing the product line. Management determined that fixed costs direct related to this particular product amounted to $54,000 annually. Principal reported $240,000 of gross sales related to this product and variable product costs of $180,000. Assuming that each Personalized Package sells for $12 per unit, what is the minimum amount of total sales dollars of Personalized Packages that Principal needs in order to justify the product line
Answer:
18,000 personalized packages
Explanation:
Profit-volume ratio = ($240,000 - $180,000) / $240,000
Profit-volume ratio = 0.25
Profit-volume ratio= 25%
Break-Even-Point = $54,000 / 25%
Break-Even-Point = 216,000
The minimum personalized packages that needs to sell to break even:
= Break-Even-Point / Personalized Package sales per unit
= 216,000 / $12
= 18,000 personalized packages
Chris Co. produces sports equipment and is currently producing 1,000 mini long boards annually. A supplier has offered to produce the boards for Chris Co. for $300 per board. Chris Co. incurs unit-level costs of $280 per unit. Chris also spends $25,000 on product design each year and incurs $50,000 of facility-level costs. The avoidable production cost for Chris to produce one mini long board is
Answer: $305
Explanation:
The avoidable production cost for Chris to produce one mini long board goes thus:
Unit Level Cost = $280
Add: Product Level Cost = $25,000 / 1000 units = $25
Then, the avoidable cost to produce one unit will be:
= $280 + $25
= $305
On January 1, 2019, QRS Company granted 80,000 stock options to certain executives. The options may be exercised on or after December 31, 2022, and expire on January 1, 2026. Each option can be exercised to acquire one share of $1 par common stock for $5. The fair value of each options was estimated to be $3 on the grant date. What amount should QRS recognize as compensation expense for 2020
Answer:
The amount QRS should recognize as compensation expense for 2020 is $80,000.
Explanation:
NS = Number of shares granted as stock option = 80,000
FV = Fair value of the options on the date of grant = $3
N = Number of years from December 31, 2022 to January 1, 2026 = 3
Therefore, we have:
Total compensation expenses = NS * FV = 80,000 * $3 = $240,000
Amount QRS should recognize as compensation expense for 2020 = Total compensation expenses / n = $240,000 / 3 = $80,000
Which career is likely to earn the highest salary
These are the professions that receive high salaries in our country, in Turkey.
For a given product demand, the time-series trend equation is 53 - 4 x. The negative sign on the slope of the equation:
a. is a mathematical impossibility.
b. is an indication that the forecast is biased, with forecast values lower than actual values.
c. is an indication that product demand is declining.
d. implies that the coefficient of determination will also be negative.
e. implies that the cumulative error will be negative.
Answer: is an indication that product demand is declining.
Explanation:
The negative sign on the slope of the time-series trend equation simply explains that the product demand is declining.
A negative slope indicates that two variables are negatively related which implies that when the value of x increases, rhen the value of y decreases, and vice versa. When putting this in a graph, the line falls when the line that's on the line graph shifts from left to right.
The correct option is C
Oriole Company incurs these expenditures in purchasing a truck: cash price $26,070, accident insurance (during use) $1,910, sales taxes $1,350, motor vehicle license $260, and painting and lettering $1,960. What is the cost of the truck?
Answer:
$29,380
Explanation:
Calculation of cost of truck for Oriole company.
Cost of truck
Cash price
$26,070
Sales taxes
$1,350
Painting and lettering
$1,960
Total cost of truck
$29,380
Please note that insurance cost and motor vehicle license are revenue expenditures and are ignored while computing the cost of the truck.
THESE ARE TRUE OR FALSE!! PLEASE HELP!!
1. A goal in life that is fulfilled through a job is called an occupation.
2. The process of studying careers, assessing yourself, and making decisions about the future
is called career planning.
3. Career planning begins when you make decisions about your interests and the occupation
you want to have someday.
4. Studying careers is continuous because new career opportunities come along regularly.
5. School libraries should be avoided in career planning.
6. Newspaper help wanted ads are interesting but of little value in career planning.
7. In career planning, you should contact both government employment offices and private
employment agencies.
8. Career information interviews can be done naturally without any advance preparation.
9. The willingness and ability of workers to move where jobs are available is called mobility.
10. A natural, in-born aptitude to do certain things is an ability.
As the Consumer Price Index increases, the value of money a. falls, so people hold less money to buy the goods and services they want. b. falls, so people hold more money to buy the goods and services they want. c. rises, so people hold more money to buy the goods and services they want. d. rises, so people hold less money to buy the goods and services they want.
Answer:
D. falls, so people hold more money to buy the goods and services they want.
Explanation:
In the case when the consumer price index rises, so the value of the money declines as the people would hold more money in order to purchase the goods and services what actually they want
Also it shows an inverse relationship between the consumer price index and the value of money i.e. if one thing is increased the other thing would decrease and vice versa
Therefore the option d is correct
[The following information applies to the questions displayed below.] University Car Wash built a deluxe car wash across the street from campus. The new machines cost $258,000 including installation. The company estimates that the equipment will have a residual value of $28,500. University Car Wash also estimates it will use the machine for six years or about 12,500 total hours. Actual use per year was as follows: Year Hours Used 1 2,700 2 1,500 3 1,600 4 2,400 5 2,200 6 2,100 Required: 1. Prepare a depreciation schedule for six years using the straight-line method. (Do not round your intermediate calculations.)
Answer:
University Car Wash
Depreciation Schedule
Date Cost of Asset Depreciation Accumulated Net book
Expense Depreciation Value
Year 1 $258,000 $38,250 $38,250 $219,750
Year 2 258,000 38,250 76,500 181,500
Year 3 258,000 38,250 114,750 143,250
Year 4 258,000 38,250 153,000 105,000
Year 5 258,000 38,250 191,250 66,750
Year 6 258,000 38,250 229,500 28,500
Explanation:
a) Data and Calculations:
Cost of the new washing machines = $258,000
Estimated residual value = $28,500
Depreciable amount = $229,500 ($258,000 - $28,500)
Straight-line annual depreciation expense = $38,250 ($229,500/6)
Estimated useful life = 6 years
Usage in hours = 12,500 hours
Actual use per year:
Year Hours Used
1 2,700
2 1,500
3 1,600
4 2,400
5 2,200
6 2,100
Total 12,500
One reason why "protecting domestic jobs" is a poor argument against free trade is because A. there is little evidence that trade protection saves domestic jobs. B. the cost of protecting jobs is much higher than the value of the jobs. C. labor in other countries is not priced lower than U.S. labor. D. any outsourcing of jobs from the U.S. is completely offset by outsourcing of jobs from other countries.
Answer: Cost of protecting jobs is much higher than the value of the jobs.
Explanation:
Protectionism is when the local industries in a country are protected against foreign competition in order to help them grow.
One of the main ideas behind free trade is for the consumers to be provided with affordable and low prices goods when there's a free movement of goods between the countries.
It should be noted that an increase in the labour cost will also.bring about an increase in the value of jobs and this can result to the goods being sold at a higher price. Therefore the correct option is B "cost of protecting jobs is much higher than the value of the jobs".
Answer:
A
Explanation:
The Peoria Supply Company sells for $30 one product that it purchases for $20. Budgeted sales in total dollars for next year are $720,000. The sales information needed for preparing the July budget follows:
Month Sales Revenue
May $30,000
June 42,000
July 51,000
August 54,000
Account balances at July 1 include these:
Cash $20,000
Merchandise inventory 18,000
Accounts receivable (sales) 23,000
Accounts payable (purchases) 12,000
The company pays for one-half of its purchases in the month of purchase and the remainder in the following month. End-of-month inventory must be 50 percent of the budgeted sales in units for the next month. A 2 percent cash discount on sales is allowed if payment is made during the month of sale. Experience indicates that 50 percent of the billings will be collected during the month of sale, 40 percent in the following month, 8 percent in the second following month, and 2 percent will be uncollectible. Total budgeted selling and administrative expenses (excluding bad debts) for the fiscal year are estimated at $180,000 , of which one-half is fixed expense (inclusive of a $20,000 annual depreciation charge). Fixed expenses are incurred evenly during the year. The other selling and administrative expenses vary with sales. Expenses are paid during the month incurred.
Required:
a. Prepare a schedule of estimated cash collections for July.
b. Prepare a schedule of estimated July cash payments for purchases.
c. Prepare schedules of July selling and administrative expenses, separately identifying those requiring cash disbursements.
Answer:
The Peoria Supply Company
a. Schedule of Estimated Cash Collections:
Cash collections: July
50% sales month $25,500
less 2% cash discount (510)
40% following month 16,800
8% second month 2,400
Total collections $44,190
b. A Schedule of Estimated July Cash Payments for Purchases
June July
Sales $42,000 $51,000
Ending inventory 18,000* 27,000
Beginning inventory 21,000 18,000*
Estimated Purchases 39,000 60,000
Payment for purchases:
50% purchase month $30,000
50% following month 19,500
Total payment for purchases $49,500
c. Selling and administrative expenses
Non-Cash expenses:
Depreciation expense $1,667
Cash disbursements:
Other fixed costs 5,333
Variable costs 6,375
Total costs $13,375
Explanation:
a) Data and Calculations:
Selling price per product = $30
Purchase cost per product = $20
Total sales dollars for next year = $720,000
Month Sales Revenue
May $30,000
June 42,000
July 51,000
August 54,000
July 1:
Cash balance = $20,000
Merchandise inventory $18,000
Accounts receivable (sales) 23,000
Accounts payable (purchases) 12,000
Ending inventory = $27,000 ($54,000 * 50%)
Ending inventory = 50% of next month's budgeted sales
Selling and administrative expenses (excluding bad debts) for the year = $180,000
Fixed costs = $90,000
Depreciation 20,000
Cash fixed costs = $70,000
Monthly fixed costs = $5,833
Variable costs = $90,000
Variable costs per sales dollars = $90,000/$720,000 = $0.125
Cash variable cost for July $0.125 * $51,000 = $6,375
a. Schedule of Estimated Cash Collections:
Cash collections: May June July August
$30,000 $42,000 $51,000 $54,000
50% sales month 15,000 21,000 25,500 27,000
less 2% cash discount (300) (420) (510) (540)
40% following month 16,800 20,400
8% second month 2,400 3,360
2% Uncollectible
Suppose the risk-free rate of return is 3.5 percent and the market risk premium is
7 percent. Stock U, which has a beta coefficient equal to 0.9, is currently selling
for $28 per share. The company is expected to grow at a 4 percent rate forever,
and the most recent dividend paid to stockholders was $1.75 per share. Is Stock
U correctly priced? Explain.
Answer:
kaya nyo po iyan
Explanation:
nice habbsjsxgjshsbvda
Which situation best describes an oligopoly?
A. A city government selects one company to provide clean water for
its residents.
B. A large oil company buys all of its competitors and shuts them
down permanently.
C. A group of vendors compete to sell the same drinks to fans at a
baseball game.
D. A few large airlines work together to set high prices and eliminate
new competitors.
Donkey Inc. has a fleet of 10 large trucks that cost a total of $1,410,000. The fleet is expected to be driven a total of 1,000,000 miles during its estimated 10-year life and be sold for $141,000 at the end of its useful life. If the fleet was driven 125,000 miles during the current year, what is the amount of depreciation that would be calculated using the straight-line and units-of-production methods, respectively
Answer:
$126,900
$125,000
Explanation:
Straight line depreciation expense = (Cost of asset - Salvage value) / useful life
( $1,410,000 - $141,000) / 10 = $126900
Activity method based on activity = (miles that year / total miles expected to be driven) x (Cost of asset - Salvage value)
( $1,410,000 - $141,000) x ( 125,000 / 1,000,000) = 125,000
Exercise 12-1 Payback Method [LO12-1] The management of Unter Corporation, an architectural design firm, is considering an investment with the following cash flows: Year Investment Cash Inflow 1 $ 15,000 $ 1,000 2 $ 8,000 $ 2,000 3 $ 2,500 4 $ 4,000 5 $ 5,000 6 $ 6,000 7 $ 5,000 8 $ 4,000 9 $ 3,000 10 $ 2,000 Required: 1. Determine the payback period of the investment. 2. Would the payback period be affected if the cash inflow in
Question Completion:
Requirement #2 would the payback period be affected if the cash inflow in the last year were several times as large
Answer:
Unter Corporation
1. Payback period of the investment is:
= 7 years.
2. No. The payback period would not be affected if the cash inflow in the last year were several times as large. The payback period was reached in the 7th year, which is three years before the last year. No cash inflows after the 7th year will have any impact on the payback period.
Explanation:
a) Data and Calculations:
Cash flows:
Year Investment Cash Inflow
1 $ 15,000 $ 1,000
2 $ 8,000 $ 2,000
3 $ 2,500
4 $ 4,000
5 $ 5,000
6 $ 6,000
7 $ 5,000 $25,500
8 $ 4,000
9 $ 3,000
10 $ 2,000
Total $23,000 $34,500
The price of a dozen eggs falls from $3 to $2.70. In response to this price change, the quantity supplied of eggs falls from 150,000 dozen eggs to 125,000 dozen eggs. What is the price elasticity of supply for eggs
Answer:
Price elasticity of supply=1.67
Explanation:
Price elasticity of supply is a measure of the degree of responsive of supply to a change in price . It is computed using the formula below:
% change in Quantity supply/% change in price
% change in Quantity supply= 125,000-150,000/150,000× 100=16.67%
% change in price = (2.70-3.00)/3.00× 100= 10.00%
Price elasticity of supply = 16.67/10.00=1.67
Price elasticity of supply=1.67
You have $100,000 in your retirement fund that is earning 5.5 percent per year, compounded quarterly. a. How many dollars in withdrawals per month would reduce this nest egg to zero in 20 years
Answer:
$680
Explanation:
The computation of the dollars in withdrawals per month that decrease this nest egg to zero in 20 years is shown below;
As we can see in the attached image that the $100,000 would be in the retirement fund so in 20 years, the withdrawals per month is $680 that decrease the nest egg to zero
Therefore the same would be considered
Calculate the annual cash flows of a $2 million, 10-year fixed-payment deferred annuity earning a guaranteed 8 percent per year if annual payments are to begin at the end of the sixth (6th) year.
Answer:
$437,946.42
Explanation:
Present Value of Deferred Annuity = $2,000,000
Value at the end of Year 5 = $2,000,000*(1.08)^5
Value at the end of Year 5 = $2,938,656.15
Calculation of Annual Payment from Annuity using the TVM
Annual payment = PMT [PV, FV, N, I]
Annual payment = PMT [2,938,656.15, 0, 10, 0.08]
Annual payment = $437,946.42
So, the Annual Payment from annuity is $437,946.42.
Diamond Boot Factory normally sells its specialty boots for $22 a pair. An offer to buy 120 boots for $18 per pair was made by an organization hosting a national event in Norfolk. The variable cost per boot is $8, and special stitching will add another $2 per pair to the cost. Determine the differential income or loss per pair of boots from selling to the organization.
Answer:
Differential income = $960
Explanation:
In a special order decision , the offer should be accepted if the sales revenue from the order is greater than the relevant costs of the special orders.
The relevant costs of the special order = variable cost + additional cost of special stitching machine
$
Sales revenue (120× $18) 2,160
The relevant costs of the special order
= (120×8) + (120×2) (1,200)
Differential income 960
Michael Corporation manufactures railroad cars, which is its only product. The standards for the railroad cars are as follows:
Standard tons of direct material (steel) per car 4
Standard cost per ton of steel $ 17.00
During the month of March, the company produced 1,650 cars.
Related production data for the month follows:
Actual materials purchased and used (tons) 6,650
Actual direct materials total cost $ 115,000
What is the direct materials quantity variance for the month?
A) $ 850 favorable
B) $ 850 unfavorable
C) $ 1,950 favorable
D) $ 1,950 unfavorable
Answer:
Direct material quantity variance= $850 unfavorable
Explanation:
Giving the following information:
Standard tons of direct material (steel) per car 4
Standard cost per ton of steel $ 17.00
During March, the company produced 1,650 cars.
Actual materials purchased and used (tons) 6,650
To calculate the direct material quantity variance, we need to use the following formula:
Direct material quantity variance= (standard quantity - actual quantity)*standard price
Direct material quantity variance= (4*1,650 - 6,650)*17
Direct material quantity variance= $850 unfavorable
Baker Company, an Ohio company that sells a branded product regionally to retail customers in Midwest. It normally sells its product for $40 per unit; however, it has received a one-time offer from a private-brand company on the West Coast to buy 1,000 units at $25 per unit. Even though the company has excess capacity to produce the units, the president of the company immediately rejected the offer; however, the chief accountant stated that it might be a profitable opportunity for the company, even though $25 is below its unit cost of $28, calculated as follows:
Cost
Direct material $12.00
Direct labor 8.00
Depreciation and other fixed costs 6.00
Total unit cost $26.00
Calculate the net advantage (disadvantage) of accepting the special order:
a. $5,000
b. ($5,000)
c. $25,000
d. ($25,000)
Answer:
Effect on income= $5,000 increase
Explanation:
Giving the following information:
One-time offer:
1,000 units at $25 per unit.
Because it is a special offer and there is unused capacity, we will not take into account the fixed costs.
Unitary cost= 12 + 8= $20
Effect on income= 1,000*(25 - 20)
Effect on income= $5,000 increase
The Iberia Tire Company has 3,000 tires in its inventory which are considered obsolete. Each tire originally cost the company $35 and the normal selling price was $45 per tire. Management is considering two options to reduce these inventory levels. Option one is to sell the tires directly to car dealerships for $30 per tire as opposed to the normal selling price of $45 per tire. The other option is to offer their current customers a $10 per tire rebate on their purchase. In addition to the $10 rebate, the program would cost the company approximately $24,000 to manage. They predict that either option will rid them completely of their excess The decision to sell directly to the car dealerships over offering the rebate will result in:_______
A. A $21,000 increase in profits.
B. A $9,000 increase in profits.
C. A $15,000 decrease in profits.
D. A $24,000 decrease in profits.
Answer:
B. A $9,000 increase in profits
Explanation:
Calculation to determine what The decision to sell directly to the car dealerships over offering the rebate will result in:
First step is to calculate the net selling prices for each group
Car dealership total price of sales = 3000 × 30 Car dealership total price of sales =$90,000
Current customers;
First step is to calculate the price of 1 tire
Price of 1 tire = $45 - $10 rebate
Price of 1 tire = $35
Total selling price = 35 × 3000
Total selling price= $105,000
Second step is to calculate net amount gotten from sales to customers
Net income= $105,000 - $24,000
Net income= $81,000
Now let calculate what the decision to sell directly to the car dealerships over offering the rebate will result in:
Decision to sell = 90,000 - 81,000
Decision to sell= $9,000 increase in profits
Therefore the decision to sell directly to the car dealerships over offering the rebate will result in:$9,000 increase in profits
, determining whether an organization has fulfilled a certain objective is most closely associated with which of the following management functions
Explanation:
Beureacracy functions
In this type of functions there is institutions that governs what each one does and also the laws and orders are followed to maintain a higher productivity
At the beginning of year 1, Kare Company initiated a quality improvement program. Considerable effort was expended over two years to reduce the number of defective units produced. By the end of the second year, reports from the production manager revealed that scrap and rework had both decreased. The president of the company was pleased to hear of the success but wanted some assessment of the financial impact of the improvements. To make this assessment, the following financial data were collected for the two years. Year 1 Year 2 Sales $ 10,000,000 $ 10,000,000 Scrap 400,000 300,000 Rework 600,000 400,000 Product inspection 100,000 125,000 Product warranty 800,000 600,000 Quality training 40,000 80,000 Materials inspection 60,000 40,000 Required: a. Classify the costs as prevention, appraisal, internal failure, and external failure. b-1. Compute total quality cost as a percentage of sales for each of the two years. b-2. By how much has profit increased because of quality improvements between Year 1 and Year 2
Answer:
a. The costs can be classified as follows:
Prevention: Quality training
Appraisal: Product inspection and Material inspection
Internal Failure: Scrap and rework
External Failure: Product Warranty
b-1. We have:
Total quality cost as a percentage of sales for Year 1 = 1.60%
Total quality cost as a percentage of sales for Year 2 = 1.65%
b-2. Profit has increased by $295,000 because of quality improvements between Year 1 and Year 2.
Explanation:
a. Classify the costs as prevention, appraisal, internal failure, and external failure.
The costs can be classified as follows:
Prevention: Quality training
Appraisal: Product inspection and Material inspection
Internal Failure: Scrap and rework
External Failure: Product Warranty
b-1. Compute total quality cost as a percentage of sales for each of the two years.
Total quality cost as a percentage of sales = ((Product inspection + Material inspection) / Sales) * 100 ………………. (1)
Using equation (1), we have:
Total quality cost as a percentage of sales for Year 1 = (($100,000 + $60,000) / 10,000,000) * 100 = 1.60%
Total quality cost as a percentage of sales for Year 2 = (($125,000 + $40,000) / 10,000,000) * 100 = 1.65%
b-2. By how much has profit increased because of quality improvements between Year 1 and Year 2?
To calculate the profit associated to quality, only costs associated to quality are deducted from Sales as follows:
Profit associated to quality = Sales - Scrap - Rework - Product inspection - Materials inspection ……… (1)
Using equation (1), we have:
Profit associated to quality for Year 1 = $10,000,000 - $400,000 - $600,000 - $100,000 - $60,000 = $8,840,000
Profit associated to quality for Year 2 = $10,000,000 - $300,000 - $400,000 - $125,000 - $40,000 = $9,135,000
Therefore, we have:
Increase in profit because of quality improvements = Profit associated to quality for Year 2 - Profit associated to quality for Year 1 = $9,135,000 - $8,840,000 = $295,000
Therefore, profit has increased by $295,000 because of quality improvements between Year 1 and Year 2.
frocks and gowns incorporated has two divisions day wear and night wear the day wear division has an investment base of 880,000 and produces and sells 134,500 units of collars at a market price of 12.20 wants to purchase 27,000 units of collars from the day wear division. what is the minimum transfer price that the day wear division would accept for the 27,000 unit order from the night wear
Question
Frocks and gowns incorporated has two divisions day wear and night wear the day wear division has an investment base of $880,000 and produces (and sells) 134,,500 units of Collars at a market price of $12.20 per unit. Variable costs total $7.80 per unit, and fixed charges are $3.90 per unit (based on a capacity of 140,000 units). The Night Wear Division wants to purchase 27,000 units of Collars from The Day Wear Division. However, the Night Wear Division is only willing to pay $8.45 per unit.
What is the contribution margin for the Day Wear Division without the transfer to the Night Wear Division?
Answer:
The minimum transfer value = $305,200
Explanation:
The company current has an excess capacity of 140,000-134,500=5,500 units
These available quantities can sold at a minimum transfer price of $7.80.
However, the balance of 21,500 (i.e 27,000 minus 5,500) should be transferred at the market price of $12.20. This is so because there is an opportunity cost attached to units supplied which is the contribution to be earned if sold at the market price.
Hence, The 27,000 units should transferred at the value computed below:
$
First 5,500= $5,500× $7.80= 42,900
The balance of 21,500 × $12.20= 262,300
The total value 305,200
The minimum transfer value = $305,200
Imagine that two goods are available to you: servants (X) and robots (Y). You like servants three times as much as robots. If your domestic help budget is $4,000 per month, the price (wage) of servants is $1500 per person per month, and the price (rent) of robots is $400 per unit per month, what is the value of the MktRS (market rate of substitution)
Answer: 3
Explanation:
The marginal rate of substitution simply means the rate at which one good will be exchanged for another good based on the current market price.
Since you like servants three times as much as robots, this implies that the utility that one gets from one servant is exactly like the utility that will be gotten from three robots.
Therefore, the utility function will be:
U = 3X + Y
Then, the marginal rate of substitution will be:
= MUX/MUY
= 3
Determine if there was a percent increase or decrease in the number of trench coats sold, and by how much. (Round your answer to the nearest tenth.)
a.
The percentage of trench coats sold decreased by 0.8%.
b.
The percentage of trench coats sold increased by 0.8%.
c.
The percentage of trench coats sold decreased by 23.3%.
d.
The percentage of trench coats sold increased by 23.3%.
Answer:
D. increase of 23.3%, right on edge
Explanation:
to find the percentage increase, first you need to substract the final from the initial, then divide the difference by the initial, then multiply your answer by 100 to get the percentage
in this case, the final is 127, and the initial is 103
127 - 103 = 24
24 ÷ 103 = 0.233
0.233 x 100 = 23.3%
Answer:
✅ D. The percentage of trench coats sold increased by 23.3%.