Answer:
$8,500
Explanation:
Given that;
Net credit sales during the year = $170,000
Estimated percentage of bad debt = 5%
The solution of estimated bad debt expense for the year is seen below;
Estimated bad debt expense for the year
= Net credit sales during the year × Estimated percentage of bad debt
= $170,000 × 5%
= $8,500
On January 1, 2021, The Barrett Company purchased merchandise from a supplier. Payment was a noninterestbearing note requiring five annual payments of $20,000 on each December 31 beginning on December 31, 2021, and a lump-sum payment of $100,000 on December 31, 2025. A 10% interest rate properly reflects the time value of money in this situation.Required:Calculate the amount at which Barrett should record the note payable and corresponding merchandise purchased on January 1, 2021.
Answer:
Barrett Company
The amount at which Barrett should record the note payable and corresponding merchandise purchased on January 1, 2021 is:
= $125,500.
Explanation:
a) Data and Calculations:
Non-interest-bearing note annual payment = $20,000
Date of annual payments = December 31
Lump sum payment on December 31, 2025 = $100,000
Interest rate reflecting the time value of money = 10%
The amount for the note payable and corresponding merchandise on January 1, 2021 is:
PV annuity factor for 4 years at 10% = 3.170
Total PV of annual payments = $63,400 ($20,000 * 3.170)
PV of lump-sum payment = 62,100 ($100,000 * 0.621)
Total PV of payments = $125,500
The resource based view (RBV) of the firm combines which two perspectives: Group of answer choices The primary and support activities of the firm. The interrelationships among the primary activities of the firm and corporate management. The internal analysis of the firm as well as the external analysis of the industry and competitive environment. The industry and the competitive environment.
Answer:
The internal analysis of the firm as well as the external analysis of the industry and competitive environment.
Explanation:
Environmental scanning is a management strategy that focuses on systematically acquiring informations about occasions, trends, events or patterns through surveys and analysis of these information in an organisation's external and internal environment. The informations acquired through environmental scanning is then used by the executive management in strategically planning the organisation's future and exploitation of available opportunities for the success of the organization.
Generally, the internal environmental scanning offers an organization strength and weakness while the external environmental scanning provides information about opportunities and threats while the external environmental scanning gives an overview of the opportunities in the market as well as potential threats to an organization.
A resource based view can be defined as a strategic model or framework used by a business firm to determine the various resources that to be exploited in order to achieve competitive advantage.
Hence, the resource based view (RBV) of the firm combines the internal analysis of the firm as well as the external analysis of the industry and competitive environment.
Sirah runs a housecleaning service. She wants her employees to be highly efficient, cleaning a certain number of houses each day, and perform their work according to established checklists of tasks that have proven to satisfy clients. What is the more appropriate style of leadership, given Sirah’s objectives for her housekeepers? Either transactional or transformational Transformational Transactional
Answer:
transactional
Explanation:
Transactional leadership includes day-to-day performance and monitoring with respect to the focus on the organization related to the supervision and compliance of rules and regulations via rewards and retribution.
Since in the given situation it is mentioned that they have to clean the houses each day and perform the work accordingly so it would be transactional leadership style
Answer:
Transactional
Explanation:
just took the test
One of the typical characteristics of management fraud is: Multiple Choice Illegal acts committed by management to evade laws and regulations. Falsification of documents in order to misappropriate funds from an employer. Victimization of investors through the use of materially misleading financial statements. Conversion of stolen inventory to cash deposited in a falsified bank account.
Answer:
Victimization of investors through the use of materially misleading financial statements
Explanation:
Management fraud is when the management of a company defrauds either their investors and creditors by using misleading financial statement
Riverbed Company had $151,800 of net income in 2016 when the selling price per unit was $151, the variable costs per unit were $91, and the fixed costs were $575,800. Management expects per unit data and total fixed costs to remain the same in 2017. The president of Riverbed Company is under pressure from stockholders to increase net income by $64,300 in 2017.
1. Compute the number of units sold in 2016. (Round answer to 0 decimal places, e.g. 1,225.)
2. Compute the number of units that would have to be sold in 2017 to reach the stockholders' desired profit level.
3. Assume that Naylor Company sells the same number of units in 2017 as it did in 2016. What would the selling price have to be in order to reach the stockholders? (Round answer to 2 decimal places, e.g. 12.25.)
Answer:
Riverbed Company
1. The number of units sold in 2016:
= 12,127
2. The number of units that would have to be sold in 2017 to meet desired profit level of stockholders:
= 13,199
3. Assuming that Naylor Company sells the same number of units in 2017 as it did in 2016, the selling price have to increase to $156.30 per unit, in order to achieve stockholders' desire for more profitability.
Explanation:
a) Data and Calculations:
2016 net income = $151,800
Selling price = $151
Variable cost per unit = $91
Contribution = $60
Fixed costs = $575,800
Units sold = 12,127 ($575,800 + 151,800)/$60
When net income increases by $64,300, the units sold will increase by 1,072 ($64,300/$60)
Sales volume = 13,199 (12,127 + 1,072)
To achieve the same level of profitability ($216,100) at the same level of units sold, the price will increase by $5.30 ($64,300/12,127) to $156.30.
The Heating Division of Kobe International produces a heating element that it sells to its customers for $40 per unit. Its variable cost per unit is $20, and its fixed cost per unit is $8. Top management of Kobe International would like the Heating Division to transfer 14,500 heating units to another division within the company at a price of $30. The Heating Division is operating at full capacity. Assume that the units being requested are special high-performance units and that the division's variable cost would be $28 per unit (rather than $20). What is the minimum transfer price that the Heating Division should accept
Answer:
$48
Explanation:
Calculation the minimum transfer price that the Heating Division should accept
Using this formula
Minimum transfer price=[New UVC + (Lost USP - Regular UVC)]
Let plug in the formula
Minimum transfer price=$28+ ($40- $20)
Minimum transfer price=$28+20
Minimum transfer price= $48
Therefore the minimum transfer price that the Heating Division should accept is $48
Pearl Corporation reported net income of $49,100 in 2020. Depreciation expense was $17,200. The following working capital accounts changed.
Accounts receivable $11,200 increase
Available-for-sale debt securities 16,900 increase
Inventory 7,300 increase
Nontrade note payable 14,400 decrease
Accounts payable 13,300 increase
Required:
Compute net cash provided by operating activities. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)
Answer:
Net operating cash flow $68,300
Explanation:
Operating cash flow is the amount of cash generated by a company from its main and normal business activity. This cash flow is useful to gauge the financial viability of a firm's business activity; the larger the better.
It is essentially computed as the net movement of cash inflow and outflow in respect of a business activities.
It is computed as follows:
$
Net income 49,000
Add deprecation 17,200
Less increase in receivable (11.200)
add increase in payables 13,300
Net operating cash flow 68,300
Note that only items that relate to trading which is the core business area of the Pearl Corporation are considered. Depreciation is added because it is a non-cash item initially deducted from net income.
An increase in receivable means a reduction in cash while an increase in payables implies cash savings
Net operating cash flow $68,300
Pleaseeeee helppppp!!!!
Answer:
they are interns hope it help
Oliver Cat Emporium had the following information for their payroll for the week ended March 23: earned wages and salaries of $45,000. All of that week's pay is subject to FICA social security taxes of 6.2% on the first $128,400 of earnings each calendar year and Medicare taxes of 1.45% on all earnings. In addition, the company withholds the following amounts for this weekly pay period: $2,200 for medical insurance, $6,500 for federal income taxes, and $675 for pet insurance.
a. Prepare the general journal entry to accrue the payroll.
b. The company is subject to state unemployment taxes at the rate of 3.4% and federal unemployment taxes at the rate of 0.6%. Prepare the general journal entry to accrue the employer's payroll tax expense. (Round your calculations to the nearest dollar).
Answer:
the answer would be a I believe
A company that makes shopping carts for supermarkets and other stores recently purchased some new equipment that reduces the labor content of the jobs needed to produce the shopping carts. Prior to buying the new equipment, the company used 7 workers, who together produced an average of 70 carts per hour. Workers receive $15 per hour, and machine cost was $40 per hour. With the new equipment, it was possible to transfer one of the workers to another department, and equipment cost increased by $10 per hour while output increased by 4 carts per hour.a. Compute labor productivity under each system. Use carts per worker per hour as the measure of labor productivity. (Round your answers to 2 decimal places.) Before _____ carts per worker per hourAfter ______carts per worker per hourb. Compute the multifactor productivity under each system. Use carts per dollar cost (labor plus equipment) as the measure. (Round your answers to 2 decimal places.)Before ______ carts/dollar costAfter _______ carts/dollar costc. Comment on the changes in productivity according to the two measures. (Round your intermediate calculations and final answers to 2 decimal places. Omit the "%" signs in your response.)Labor productivity by _____%Multifactor productivity by _____ %
Answer:
Before buying the new equipment:
Number of workers = 7
Production = 70 carts per hour
Worker wage = $15 per hour
Machine cost = $40 per hour
After buying the new equipment:
Number of workers = 6
Production = 74 carts per hour
Worker wage = $15 per hour
Machine cost = $50 per hour
(a) Labor productivity
Labor productivity = Number of carts produced per hour / Number of workers
Labor productivity (Before) = 70 / 7
Labor productivity (Before) = 10 carts per worker per hour
Labor productivity (After) = 74 / 6
Labor productivity (After) = 12.33 carts per worker per hour
(b) Multifactor productivity
Multifactor productivity = Carts produced / (Labor cost + Equipment cost)
Multifactor productivity = Carts produced / [(Number of workers x Worker wage) + Equipment cost)
Multifactor productivity (Before) = 70 / [(7*$15) + $40]
Multifactor productivity (Before) = 0.48 carts/dollar cost
Multifactor productivity (After) = 74 / [(6*$15) + $50]
Multifactor productivity (After) = 0.53 carts/dollar cost
(c) Increase in productivity
Increase in productivity = [(New productivity - Old productivity) / Old productivity] * 100
Increase in labor productivity = [(12.33 - 10) / 10] * 100
Increase in labor productivity = 0.233 * 100
Increase in labor productivity = 23.30%
Increase in multifactor productivity = [(0.53 - 0.48) / 0.48] * 100
Increase in multifactor productivity = 0.104167 * 100
Increase in multifactor productivity = 10.42%
is it possible for a company to be too liquid
Answer:
yes it is possible ......
Answer:
A company can have too much liquidity, which may be a sign that it's holding onto cash that could be invested. In a sense, even borrowing money is another typical source of liquidity for businesses. To meet its obligations, the ability to take out loans will be a factor in its liquidity.
Explanation:
Budgeted sales for the month at 4,600 units. Budgeted variable selling and admin expense is $7.30 per unit. Budgeted fixed selling and admin expense is $51,980 of which $6,440 is depreciation. What is the budgeted cash disbursement amount for selling and administrative expense for the month?
Answer:
$79,120
Explanation:
Calculation for the budgeted cash disbursement amount for selling and administrative expense for the month
First step is to calculate the Total variable selling and administrative expense
Using this formula
Total variable selling and administrative expense= Budgeted unit sales for August × variable selling and administrative expense per unit
Let plug in the formula
Total variable selling and administrative expense= 4,600 × $7.30
Total variable selling and administrative expense= $33,580
Second step is to calculate the Total fixed selling and administrative expense
Total fixed selling and administrative expense
= Budgeted fixed selling and administrative expense - Depreciation per month
Let plug in the formula
Total fixed selling and administrative expense= $51,980 - $6,440
Total fixed selling and administrative expense=$45,540
Now let calculate the budgeted cash disbursement amount for selling and administrative expense for the month
Using this formula
Budgeted cash disbursement = Total variable selling and administrative expense + Total fixed selling and administrative expense
Let plug in the formula
Budgeted cash disbursement= $33,580 + $45,540
Budgeted cash disbursement= $79,120
Therefore the budgeted cash disbursement amount for selling and administrative expense for the month will be $79,120
Marigold Corp. took a physical inventory on December 31 and determined that goods costing $155,000 were on hand. Not included in the physical count were $28,000 of goods purchased from Pelzer Corporation, FOB shipping point, and $21,800 of goods sold to Alvarez Company for $30,400, FOB destination. Both the Pelzer purchase and the Alvarez sale were in transit at year-end. What amount should Marigold report as its December 31 inventory
Answer: $204,800
Explanation:
When a good is shipped FOB shipping point, it means that the buyer assumes responsibility for the goods as soon as the goods reach the place they will be shipped from. The purchase from Pelzer should therefore be included in inventory because it has already been shipped.
A good shipped FOB Destination means that the buyer only assumes responsibility after the goods have been delivered to them. As the sale to Alvarez was still in transit, it is still the responsibility of Marigold and should be included in inventory.
Inventory is therefore:
= 155,000 + 28,000 + 21,800
= $204,800
If a local-level fair housing group wins a fair housing lawsuit against a landlord, who gets the money from the resulting judgment? When landlords are fined, the money goes to the Texas state treasury. All judgment awards, minus attorney fees, go to the individuals who actually suffered the discrimination. The money goes to the fair housing group that brought the lawsuit. The money goes into a fund established to help victims of discrimination statewide.
Answer: The money goes to the fair housing group that brought the lawsuit.
Explanation:
The fair housing group that brought the suit is the one that incurred the costs of litigation. They will therefore be rightly expected, to be the ones to enjoy the benefits of litigation as the money won in the suit would go to them.
They would in most cases however, spend some of this money on victims of discrimination at their own discretion. The region affected by the lawsuit would still gain fairer laws even if they did not gain money like the group did.
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The following situations refer only to the preceding data; there is no connectionbetween the situations. Unless stated otherwise, assume a regular selling price of $6 per unit. Choose the best answer to each question. Show your calculations.1.The pen is usually produced and sold at the rate of 240,000 units per year (an average of 20,000 per month). The selling price is $6 per unit, which yields total annual revenuesof $1,440,000. Total costs are $1,416,000, and operating income is $24,000, or $0.10 per unit. Market research estimates that unit sales could be increased by 10% if prices were cut to $5.80. Assuming the implied cost-behavior patterns continue, this action, if taken, would
Answer:
If prices are cut by $0.2 then the operating income will increase by $91,200.
Explanation:
Current Gross Profit is :
Revenue [240,000 * $6] = $1,440,000
Cost of Sales = $1,416,000
Gross Profit = $24,000
If selling price is reduced to $5.80
Revenue $5.80 * [ 240,000 * 1.10 % ] = $1,531,200
Cost of Sales $1,416,000
Gross Profit = $115,200
Management wants a list of vendors with account balances as of 12/15/2024, sorted from the smallest to the largest amount outstanding. The following columns are to be included, from left to right: Active Status, Name (Vendor), Balance Total, Vendor Type, and Terms. Hint: Use the Vendor tab of the Vendor Center. Then change the view to include only vendors with open balances prior to sorting and printing.
Required:
Prepare and print the list requested by management.
Answer:
The vendor list can be created by using the spreadsheet. The column 1 will show all the names of the vendor, the column next to the names of vendor will show the active status. This can be shown using the symbols or signs present in the tool bar of the spreadsheet.
Explanation:
Spreadsheet makes the work easier for accountants. The list of vendor can be created with ease and it is easy for the user to sort and filter the data by just one click on the options. The vendor list will show the active list of the vendors along with their vendor type and balance totals.
After reading the article, select the statements that are correct. Choose one or more: A. Elizabeth Warren has proposed using a new inflation measure that outpaces the current one used. B. The former program trustee argues that the current inflation measure overcompensates seniors since it ignores the substitution effect. C. According to advocates for seniors, the 2020 COLA is not enough to compensate for rising healthcare costs. D. Next year, the average monthly Social Security payment will be almost $1,800. E. The cost-of-living adjustment for 2020 is more than what it was in 2019.
Answer:
A). Elizabeth Warren has proposed using a new inflation measure that outpaces the current one used.
B). The former program trustee argues that the current inflation measure overcompensates seniors since it ignores the substitution effect.
C). According to advocates for seniors, the 2020 COLA is not enough to compensate for rising healthcare costs.
Explanation:
In the context of the article titled 'Social Security checks to rise modestly amid a push to expand benefits,' the first three statements assert the appropriate claims. It correctly states the new course of action for dealing with inflation as proposed by Elizabeth Warren after Blahous and seniors' complaint about the problems associated with the present rate for adjusting inflation as it ignored the impact created by substitution. Since the present program(COLA) could not fulfill the compensation needs of the seniors, the new program has been proposed to overcome these flaws and compensate them appropriately.
Which of the following statement about communication is true? a. In a business scenario, communication occurs only during the leading function of management. b. Communication is a one-way process in most cases. c. It is necessary to have an agreement for an effective communication. d. There must be mutual understanding for the communication to be successful.
Answer:
c. It is necessary to have an agreement for an effective communication
Explanation:
The communication is basically a two way communciation where the sender send the message and the receiver received the message by decoding the message sended by the sender
When the communciation starts so there is an agreement i.e. necessary between the parties to have an effective communication
hence, the correct option is c.
Parnevik Company has the following securities in its investment portfolio on December 31, 2020 (all securities were purchased in 2014): (1) 3,240 shares of Anderson Co. common stock which cost $61,560, (2) 10,460 shares of Munter Ltd. common stock which cost $585,760, and (3) 6,790 shares of King Company preferred stock which cost $278,390. The Fair Value Adjustment account shows a credit of $10,340 at the end of 2020.
In 2015, Parnevik completed the following securities transactions.
1. On January 15, sold 3,240 shares of Anderson’s common stock at $23 per share less fees of $2,120.
2. On April 17, purchased 1,200 shares of Castle’s common stock at $33 per share plus fees of $1,840.
On December 31, 2021, the market prices per share of these securities were Munter $65, King $40, and Castle $24. In addition, the accounting supervisor of Coronado told you that, even though all these securities have readily determinable fair values, Coronado will not actively trade these securities because the top management intends to hold them for more than one year.
Required:
a. Prepare the entry for the security sale on January 15, 2021.
b. Prepare the journal entry to record the security purchase on April 17, 2021.
c. Compute the unrealized gains or losses.
Answer:
Unrealized gain = 74710
Explanation:
The answers for a and b are a journal which is in a table. I have computed this in the attachment
C. U realized gain computation
Munter = $10460 x 65 = $679900
King company = 6790 x 40 = $271600
Castle company = 41440 x 24 = 28800
Unrealized gain/loss = (679900-585760)+(271600-278390)+(28800-41440) = $74710
The unrealized gain = 74710
Mogul Company ships merchandise to Ski Outfit in a consignment arrangement. The arrangement specifies that Ski Outfit will attempt to sell the merchandise, and in return, Mogul will pay to Ski Outfit a 15% sales commission on any merchandise sold. During the year, Mogul ships inventory with a cost of $130,000 to Ski Outfit. By the end of the year, $100,000 of the merchandise has been sold to customers for a total of $137,000. What amount of inventory will Mogul report at year end
Answer:
The amount of inventory Mogul will report at year end is $30,000.
Explanation:
The amount of inventory Mogul will report at year end can be calculated as follows:
Costs of goods available for sale = Costs of inventory shipped by Mogul = $130,000
Cost of goods sold = $100,000
Inventory at year end = Costs of goods available for sale - Cost of goods sold = $130,000 - $100,000 = $30,000
Therefore, the amount of inventory Mogul will report at year end is $30,000.
Do It! Review 11-1 Indicate whether each of the following statements is true or false. 1. The corporation is an entity separate and distinct from its owners. 2. The liability of stockholders is normally limited to their investment in the corporation. 3. The relative lack of government regulation is an advantage of the corporate form of business. 4. There is no journal entry to record the authorization of capital stock. 5. No-par value stock is quite rare today.
Answer:
true
false
false
true
false
Explanation:
Suppose that the government charges a firm a franchise tax each year (instead of only once). Describe the effect of this tax on the marginal cost, average variable cost, short-run average cost, and long-run average cost curves. (Assume that the firm's before-tax average cost curve, , is U-shaped.)The annual franchise tax ___________ not affectthe firm's marginal cost curve,_____________ not affect increases the firm's average variable cost curve,_____________does not affectincreasesdecreasesthe short-run average cost curve, and___________ not affect decreases the long-run average cost curve.
Answer: does not affect; does not affect; increases; increases
Explanation:
''The annual franchise tax does not affect the firm's marginal cost curve, does not affect the firm's average variable cost curve, increases the short-run average cost curve, and increases the long-run average cost curve.''
Franchise taxes do not affect output so will not be apportioned to output. This means that neither the marginal cost nor the variable cost will change because the tax does not change with output.
The fixed costs will however increase because the tax is a fixed cost. As fixed cost is a part of total cost, the average cost curve will increase to show this change. The tax is paid each year instead of once so in the long run the firm would still be paying the tax so the long run average cost curve is affected as well.
Because testing of nuclear bombs was halted internationally in 1992, the Department of Energy has developed a laser system that allows engineers to simulate (in a laboratory) conditions in a thermo-nuclear reaction. Due to soaring cost overruns, a congressional committee undertook an investigation and discovered that the estimated development cost of the project increased at an average rate of 2% per six-months over a 5-year period. If the original cost was estimated to be $3.1 billion 5 years ago, what is the expected cost today?
Answer:
The estimated development cost of the project will increase from the original cost of $3.1 billion 5 years ago to $3.7727 billion today.
Explanation:
Data and Calculations:
Original estimated development cost = $3.1 billion
Average rate of interest = 2% per six months or 4% per year (2 * 2%)
Period of project = 5 years using 4% or 10 using 2%
Using a future value factor of 1.217 from a future value table at 4% per year for 5 years:
The expected cost today = $3.1 billion * 1.217 = $3.7727 billion
Using an online financial calculator:
Results:
FV = $3,778,882,701.98
Total Interest $678,882,701.98
N (# of periods) 10
I/Y (Interest per year) 4
PV (Present Value) $3,100,000,000
PMT (Periodic Payment) 0
Settings
P/Y (# of periods per year) 2
C/Y (# of times interest compound per year) 2
The VP of human resources wants to make the case for hiring and promoting more female managers. She has heard about the "female advantage" and asks you, "How could this support my position?"
A. Because girls tend to have few leadership opportunities in school, they are hungrier for power than men by the time they reach the workforce.
B. Women are inherently stronger contributors in small, more intimate organizations than in large, more impersonal corporations.
C. Because some women have the capacity to be seductive, they can climb the career ladder faster than equally qualified men.
D. As workplaces become more collaborative, women’s tendency to have high verbal skills and relationship skills can make them strong managers.
Answer:
D. As workplaces become more collaborative, women’s tendency to have high verbal skills and relationship skills can make them strong managers.
Explanation:
The workplace, especially managerial positions, is still substantially assumed by men, but there is a strong trend in the vision of women's ability to lead, as organizations and the work environment are becoming increasingly flexible in relation to social dynamics and multicultural. Globalization and competitiveness induce companies to be more open to negotiation, assertive leadership and to a collaborative and development-oriented workplace, which women can exercise more appropriately according to some characteristics inherent to women, such as the ability to have more empathy, greater verbal and relationship-building skills, which can make women leaders effective in a highly competitive environment.
ASC 480-10 provides guidance on determining whether (1) certain financial instruments with both debt-like and equity-like characteristics should be accounted for outside of equity (i.e., as liabilities or, in some cases, assets) by the issuer and (2) SEC registrants should present certain redeemable equity instruments as temporary equity. Examples of contracts and transactions that may require evaluation under ASC 480-10 include:________
Answer:
. Redeemable shares.
• Redeemable noncontrolling interests.
• Forward contracts to repurchase own shares.
• Forward contracts to sell redeemable shares.
• Written put options on own stock.
• Warrants (and written call options) on redeemable equity shares.
• Warrants on shares with deemed liquidation provisions.
• Puttable warrants on own stock.
• Equity collars.
• Share-settled debt (this term is used to describe a share-settled obligation that is not in the legal form of debt but has the same economic payoff profile as debt).
• Preferred shares that are mandatorily convertible into a variable number of common shares.
• Unsettled treasury stock transactions.
• Accelerated share repurchase programs.
• Hybrid equity units.
Explanation:
ASC 480-10 is used when an issuer, in the declaration of its financial position, has to categorize some financial instruments that share the characteristics of liabilities and equities. The issuer always classifies legal-form debt as liability and this makes it not applicable under the ASC 480-10.
Under the ASC 480-10, three types of financial instruments are meant to be classified and they include;
1. Mandatorily redeemable financial instruments
2. Obligations to repurchase the entity’s equity shares by transferring assets, and
3.Certain obligations to issue a variable number of equity shares
Assume markup is based on cost. Find the dollar markup and selling price for the following problem.
Item Cost Markup percent Dollar markup Selling price
Burberry men’s watch $590 20%
Answer and Explanation:
The computation of the dollar markup and the selling price is shown below
The dollar markup is
= $590 × 20%
= $118
And, the selling price
= Cost + dollar markup
= $590 + $118
= $708
hence, the same would be relevant and considered too
Lightning Semiconductors produces 200,000 hi-tech computer chips per month. Each chip uses a component that Lightning makes in-house. The variable costs to make the component are $1.20 per unit, and the fixed costs are $1,300,000 per month. The company has been approached by a foreign producer who can supply the component, within acceptable quality standards, for $1.10 each. The fixed costs are unavoidable, and Lightning would have no other use for the facilities currently employed in making the component. What would be the effect if the company decides to outsource?
a. There would be no effect on operating income.
b. Lightning Semiconductors could save $1,300,000 per month in costs.
c. Lightning Semiconductors could save $20,000 per month in costs.
d. Lightning Semiconductor's costs would increase by $220,000 per month
Answer:
c. Lightning Semiconductors could save $20,000 per month in costs.
Explanation:
The Differential Analysis would be presented below:
Particulars Make Buy
Variable production cost $240,000
Purchase price $220,000
Total relevant Cost $240,000 $220,000
Based on the above table, the financial advantage is
= $240,000 - $220,000
= $20,000
.
A congresswoman from a state with several semiconductor factories argues that the government should impose a tariff on semiconductors because they are a necessary input into the production of various weapons. Free trade, she contends, would make the United States overly dependent on foreign countries for the supply of semiconductors and thus, in case of war, unable to make enough weapons to defend itself. Which of the following justifications is the senator using to argue for the trade restriction on semiconductors?
a. Infant-industry argument
b. Using-protection-as-a-bargaining-chip argument
c. Jobs argument
d. Unfair-competition argument
e. National-security argument
Answer:
National-security argument
Explanation:
Governments may intervene in markets for any reason at all.
A tariff is simply known as a tax
that is imposed on imports. There are various reasons why trade is restricted for product or services. The different arguments for restricting trade includes:
1. jobs argument
2. national security argument
3. infant-industry argument
4. unfair-competition argument
5. protection-as-bargaining-chip argument
The national security argument state that industries or product important to national security should be protected from foreign competition and not allow to focus mainly on dependence on imports that could be scattered during wartime.
The National Security Response is said to be as good as long as we base policy on true security needs.
Break-Even Sales and Sales to Realize Income from Operations For the current year ended October 31, Friedman Company expects fixed costs of $14,300,000, a unit variable cost of $250, and a unit selling price of $380. a. Compute the anticipated break-even sales (units). fill in the blank 1 units b. Compute the sales (units) required to realize income from operations of $2,405,000. fill in the blank 2 units
Answer:
Part a
110,000 units
Part b
128,500 units
Explanation:
Break even sales is the level at which a firm makes neither a profit nor a loss.
Break-even (sales) = Fixed Costs ÷ Contribution per unit
where,
Fixed Costs = $14,300,000
Contribution per unit = Sales - Variable Costs
= $380 - $250
= $130
therefore,
Break-even (sales) = $14,300,000 ÷ $130 = 110,000 units
Units to reach Target Profit = (Target Profit + Fixed Costs) ÷ Contribution per unit
= ($2,405,000 + $14,300,000) ÷ $130
= $16,705,000 ÷ $130
= 128,500 units