Answer:
Hi, the question you provided is missing the sales amounts.
However, the important principles for this questions are explained below :
A multiple-step income statement shows separately income derived from Primary Activity of the entity (Operating Income / Loss) and income that includes Secondary Activities of the Company (Net Income / Loss).
Operating Expenses used in determination of Operating Income can be further categorized into Selling, General and Administrative Expenses.
Here is what the multiple-step income statement would look like using the data and information available.
Multiple-step income statement for month ended August 31, 2012
Sales Revenue (information missing) $ ? ? ?
Less Cost of Sales :
Opening Merchandise $0
Add purchases $ 119,070
Add transport expenses $3,900
Less Purchase returns and allowances ($5,715) $117,255
Net Purchases $117,255
Less Closing Merchandise ($32,684) ($84,571)
Gross Profit $ ? ? ?
Operating Income
Discount Received $2,500
Net Income / Loss $ ? ? ?
On December 31, 2014, Flint Corporation sold for $100,000 an old machine having an original cost of $180,000 and a book value of $80,000. The terms of the sale were as follows:
$20,000 down payment
$40,000 payable on December 31 each of the next two years
The agreement of sale made no mention of interest; however, 9% would be a fair rate for this type of transaction. What should be the amount of the notes receivable net of the unamortized discount on December 31, 2012 rounded to the nearest dollar? (The present value of an ordinary annuity of 1 at 9% for 2 years is 1.75911.)
a. $70,364
b. $90,364.
c. $80,000.
d. $140,728.
Answer:
a. $70,364
Explanation:
We must determine the present value of the notes receivable using the 9% discount rate.
PV of accounts receivable = $40,000 / 1.09 + $40,000 / 1.09² = $36,697.25 + $33,667.20 = $70,364.45
When a notes receivable is issued and carries no interests, you have to record the present value of the notes receivable in order to determine the amount that should be recorded as interest income in the future. In this case, interest income = $80,000 - $70,364 = $9,636
A portfolio manager generates a 20% rate of return on a "small cap" portfolio, compared to a 15% rate of return on the benchmark portfolio and a 10% rate of return on the Standard and Poor's 500 index over the same period. The passive rate of return on the portfolio is:
Answer:
15%
Explanation:
A passive portfolio management is an act of running a portfolio to meet the performance and requirements of a benchmark portfolio.
Given that:
A portfolio manager generates = 20% rate of return
Benchmark portfolio = 15% rate of return
Standard and Poor's 500 index = 10% rate of return.
The passive rate of return will be 15%. This is because a passive rate of return is attained by putting money into the right index fund, From the information given; the benchmark index has an 15% rate of return. As such, that is the return any passive investor could attain as a result of putting money in an index fund.
Problem-solving is an interpersonal ability to take corrective action in a problem situation in order to meet desired objectives.
A. True
B. False
Answer:
True.
Explanation:
Problem-solving is an interpersonal ability to take corrective action in a problem situation in order to meet desired objectives.
The problem-solving skills is an essential and very important attribute that is meant to be possessed by each and every leader. A problem-solving skill is one of the most important part of conceptual skills and it involves the use of an individual's interpersonal or cognitive ability to take corrective action when faced with a problematic situation in order to meet the desired or set objectives in an organization or team. There are basically four (4) essential steps to solving a problem and these are;
1. You should identify the problem.
2. Design an alternative solution to the problem.
3. Evaluate the solutions and choose the best among the solutions.
4. Execute the solution deemed to be best and most effective.
g For this question, ignore inflation. Suppose Jenny earns $60,000 per year working as a tax analyst. After ten years, she quits her job and pursues a PhD in Art History. For the 5 years she is in school, she gets a teaching stipend of $12,000 per year. For the next 35 years, she is an art director and earns $95,000. If she expects to live for 20 years in retirement. If Jenny doesn’t earn any interest on her savings and wants to perfectly smooth consumption across her life, how much will she consume every year? What might prevent her from perfectly smoothing consumption?
Answer:
If Jenny doesn’t earn any interest on her savings and wants to perfectly smooth consumption across her life, how much will she consume every year?
Jenny's total income during her life = income as tax analyst ($60,000 x 10) + income as PhD student ($12,000 x 5) + income as Art Director (35 x $95,000) = $3,985,000
she generated income during 50 years and expects to live 20 more, so in order to perfectly smooth consumption across her life, she must divide her total life income by 70 years = $3,985,000 / 70 years = $56,928.57 per year
What might prevent her from perfectly smoothing consumption?
First of all, besides inflation, you also earn interest on your savings. That is why 401k and other retirement accounts work so well (the magic of compound interest). Even if inflation and interests didn't exist, you cannot know exactly what you are going to earn in the future and for how many years. In this case, she earned $60,000 for 10 years, but then earned only $12,000 during 5 years. If she really wanted to smooth her consumption, she would have needed to get a loan because her savings during the first 10 years wouldn't be enough.
The bid-ask spread exists because of _______________. A. market inefficiencies B. discontinuities in the markets C. the need for dealers to cover expenses and make a profit D. lack of trading in thin markets
Answer:
C. the need for dealers to cover expenses and make a profit
Explanation:
In the market for securities there are two pricing of securities.
The ask price is the price at which the buyer is willing to purchase a security.
The ask price or the offer price is price at which the seller of a security is willing to sell it. Ask price can be firm or negotiable.
Bid ask spread is the difference between the highest amount a buyer is willing to buy a security and the lowest price at which a seller is willing to sell it.
This spread exists because dealers need to cover expenses and make a profit
Select the appropriate reporting method for each of the items listed below.
Item Reporting Method
1. Accounts payable.
2. Current portion of long-term debt.
3. Sales tax collected from customers.
4. Notes payable due next year.
5. Notes payable due in two years.
6. Advance payments from customers.
7. Commercial paper.
8. Unused line of credit.
9. A contingent liability with a probable likelihood of
occurring within the next year and can be estimated.
10. A contingent liability with a reasonably possible likelihood
of occurring within the next year and can be estimated.
Answer:
Items --- Reporting Method
1 . Accounts payable - Current liability
2 . Current portion of long-term debt - Current liability
3 . Sales tax collected from customers - Current liability
4 . Notes payable due next year - Current liability
5 . Notes payable due in two years - Long-term liability
6 . Advance payments from customers - Current liability
7 . Commercial paper - Current liability
8 . Unused line of credit - Disclosure note only
9 . A contingent liability that is probable likelihood of occurring within the next year and can be estimated - Current liability
10 . A contingent liability that is reasonably possible likelihood of occurring within the next year and can be estimated - Disclosure note only
Workers at Majestic Manufacturing have won the right to unionize, but management is unwilling to participate in the collective bargaining process and bargain in "good faith." This is a direct violation of the _______Act.
Answer: National Labor Relations Act
Explanation:
Passed in 1935, this is a fundamental act in United States Labor law that grants private sector employees the right to join Unions and engage with employers in Collective Bargaining to better their employment conditions. This act even gave the employees the right to strike if their demands are not meant.
Most relevant is that in Section 8 of the Act, it is made clear that when an Employer refuses to engage in Collective Bargaining with the representative of their employees, that this is an unfair labor practice and under the Act, is considered to be illegal.
New lithographic equipment, acquired at a cost of $800,000 on March 1 at the beginning of a fiscal year, has an estimated useful life of five years and an estimated residual value of $90,000. The manager requested information regarding the effect of alternative methods on the amount of depreciation expense each year. In the first week of the fifth year, on March 4, the equipment was sold for $135,000.
Required:
a. Determine the annual depreciation expense for each of the estimated five years of use, the accumulated depreciation at the end of each year, and the book value of the equipment at the end of each year by (a) the straight-line method and (b) the double-declining-balance method.
b. Journalize the entry to record the sale assuming the manager chose the double-declining-balance method.
c. On January 1, journalize the entry to record the sale in (b), assuming that the equipment was sold for $88,750 instead of $135,000.
Answer:
a. Determine the annual depreciation expense for each of the estimated five years of use, the accumulated depreciation at the end of each year, and the book value of the equipment at the end of each year by:
(a) the straight-line method
depreciation expense per year = ($800,000 - $90,000) / 5 years = $142,000
End of year depreciation expense book value
1 $142,000 $658,000
2 $142,000 $516,000
3 $142,000 $374,000
4 $142,000 $232,000
and (b) the double-declining-balance method.
depreciation expense year 1 = 2 x 1/5 x $800,000 = $320,000
depreciation expense year 1 = 2 x 1/5 x $480,000 = $192,000
depreciation expense year 1 = 2 x 1/5 x $288,000 = $115,200
depreciation expense year 1 = 2 x 1/5 x $172,800 = $69,120
End of year depreciation expense book value
1 $320,000 $480,000
2 $192,000 $288,000
3 $115,200 $172,800
4 $69,120 $103,680
b. Journalize the entry to record the sale assuming the manager chose the double-declining-balance method.
Dr Cash 135,000
Dr Accumulated depreciation - lithographic equipment 696,320
Cr Lithographic equipment 800,000
Cr Gain on sale 31,320
c. Journalize the entry to record the sale in (b), assuming that the equipment was sold for $88,750 instead of $135,000.
Dr Cash 88,750
Dr Accumulated depreciation - lithographic equipment 696,320
Dr Loss on sale 14,930
Cr Lithographic equipment 800,000
Cindy's current year adjusted gross income (AGI) is $300,000 and her current year total tax liability is $60,000. Her immediate prior year AGI is $200,000 with a total tax liability of $40,000. To avoid an underpayment interest penalty, what is Cindy's minimum required total tax payment amount for the current year
Answer:
The answer is $44,000
Explanation:
Solution
Given that
Now
Present/current year AGI = $300000
Present /current year tax liability = $60000
Prior year AGI = $200000
Prior year tax liability = $40000
Thus
As per Tax rule or applying the Tax rule
If Adjusted gross income(AGI) of prior year is below $250000 then the minimum required tax payment in the current year in order to avoid interest penalty is lower of
(1) 90% of present /current year tax (liability) or
(2) 110% of prior year tax liability
So
Because the prior year AGI is $200000 which is lower than $250000, in order to avoid interest penalty, the minimum required payment amount of tax liability in current/present year is lower of
(1) 90% of current year tax liability of $60000
Then
$60000 *90% = $54000
Or
(2)110% of prior year tax liability of $40000
$40000 ×110% = $44000
Hence, minimum required total tax payment amount for the current year is $44,000
Fleesum recently began using cross-functional teams. Dee wants to make sure the teams collaborate effectively, but also wants to avoid stifling individual initiative. One method she could use to achieve this goal would be to:
Answer:
use a skill-based pay plan for the teams.
Explanation:
Based on this scenario it can be said that the best method for Dee to use would be a skill-based pay plan for the teams. A Skill-based pay (SBP) is a unique compensation method that is designed to reward individual employees with additional pay in exchange for formal certification of the employee's mastery of skills, knowledge, and/or competencies. This will promote individual initiative without suppressing a cooperative work environment.
Suppose we are looking at a cash flow statement constructed using the INDIRECT method. We see a positive adjustment in the operating section of $1000 for Depreciation. Which of the following are correct interpretations of this? A. Depreciation provided cash of $1000 B. The firm sold long-term assets for $1000 C. The firm invested $1000 of cash in long-term assets D. Income was lower by $1000 because of Depreciation expense
Answer: D. Income was lower by $1000 because of Depreciation expense
Explanation:
When preparing the Cashflow Statement using the Indirect method, Depreciation is added to the Net Income in the Operating Section.
This is because Depreciation is a non-cash expense that was removed from the revenue to calculate income. Now that the company wants to know how much actual cash it has, it will have to add back Depreciation because depreciation is not a cash expense so does not actually reduce the money the company has.
If James and Kamanda had reached a void agreement that included conditions, then Kamanda would have had to give James the toaster if the conditions were satisfied.
a. True
b. False
There is a problem with the question, the word void should not be there. A void agreement is simply not enforceable since it is not valid. So I will assume that they both reached a valid agreement and it was a typing mistake.
Answer:
a. True
Explanation:
If two (or more) parties engage in a valid contract that includes certain specific conditions that are necessary in order to complete performance, and these conditions are met by one of the parties, then the other party must perform their part. In other words, if James performed all the conditions that were included in their contract, then Kamanda should hand over the toaster to James.
Exercise 7-3A Allocate costs in a basket purchase (LO7-1) Red Rock Bakery purchases land, building, and equipment for a single purchase price of $360,000. However, the estimated fair values of the land, building, and equipment are $115,000, $253,000, and $92,000, respectively, for a total estimated fair value of $460,000. Required: Determine the amounts Red Rock should record in the separate accounts for the land, the building, and the equipment
Answer:
Land = $90,000
Building = $198,000
Land = $72,000
Explanation:
The Fair Values of Land, Building and Equipment are used to apportion the single purchase price to the respective asset accounts as follows :
Land = $115,000/ $460,000 × $360,000
= $90,000
Building = $253,000/ $460,000 × $360,000
= $198,000
Land = $92,000/ $460,000 × $360,000
= $72,000
Which one of the following is not a factor that influences a business's control environment? Group of answer choices management's philosophy and operating style organizational structure proofs and security measures personnel policies
Answer:
proofs and security measures
Explanation:
According to the Sarbanes-Oxley, there are three factors that affect the Company's Control Environment which is as follows
1. Personnel Policies
2. Management's Philosophy and their operating styles
3. And, the last one is Organizational Structure
Therefore the third option is not a influencing factor for a business control environment
Carla Vista Company has the following information available for September 2020. Unit selling price of video game consoles $400 Unit variable costs $240 Total fixed costs $54,400 Units sold 6001. Compute the unit contribution margin. Unit contribution margin_______ 2. Compute Carla Vista' break-even point in units. 3. Prepare a CVP income statement for the break-even point that shows both total and per unit amounts.
Answer and Explanation:
a. The computation of unit contribution margin is shown below:
As we know that
Unit contribution margin = Unit selling price - unit variable cost
= $400 - $240
= $160
b. The break even point in units is as follows
As we know that
= Fixed cost ÷ unit contribution margin
= $54,400 ÷ $160
= $340
c. Now the preparation of the CVP income statement for the break even point is shown below:
Carla Vista Company
CVP Income statement
Particulars Amount Units
Sales $136,000 $400
Less: Variable cost -$81,600 $240
Contribution margin $54,400 $160
Less: Fixed cost -$54,400
Net operating income $0
Ginger, Inc., has declared a $6.40 per share dividend. Suppose capital gains are not taxed, but dividends are taxed at 10 percent. New IRS regulations require that taxes be withheld at the time the dividend is paid. The company's stock sells for $94.50 per share, and the stock is about to go ex dividend. What do you think the ex-dividend price will be?
Answer:
$88.74
Explanation:
Ginger incorporation has declared a dividend of $6.40 per share
The dividends are taxed at 10%
= 10/100
= 0.1
The company's stock is sold at $94.50 per share
Therefore, the ex-dividend price can be calculated as follows
Ex-dividend price= Current selling price-dividend(1- tax rate)
= $94.50-$6.40(1-0.10)
= $94.50-$6.40(0.9)
= $94.50-$5.76
= $88.74
Hence the ex-dividend price is $88.74
Hutter Corporation declared a $0.50 per share cash dividend on its common shares. The company has 20,000 shares authorized, 9,000 shares issued, and 8,000 shares of common stock outstanding. The journal entry to record the dividend payment is:
Answer and Explanation:
The journal entry to record the dividend payment is shown below:
Common Dividends payable $4,000 (8,000 shares outstanding × $ 0.50 cash dividend)
To Cash for $4,000
(being the dividend payment is recordeD)
For recording this we debited the common dividend payable as it decreased the liabilities and credited the cash as it also decreased the assets
The beta of an all-equity firm is 1.4. Suppose the firm changes its capital structure to 40 percent debt and 60 percent equity. What is the equity beta of the levered firm
Answer:
1.59
Explanation:
The formula required to calculate the equity beta of the levered beta is given below:
Levered Beta=Unlevered Beta*((1+(1-tax rate)*(debt/equity))
unlevered bera=1.4
tax rate (assume it is 30%) is 0.30
debt is 40% or 0.40
equity is 60% or 0.60
Levered Beta=1.4((1+(1-0.30)*(0.40/0.60))
levered Beta=1.4*(1+0.7)*0.666666667
levered beta=1.4*1.133333334
levered beta= 1.59
You can recompute using the missing actual tax rate
If the factory overhead is overapplied, then the adjusting journal entry to close the factory overhead account includes a: (Check all that apply.)
Answer:
Hie, the question is missing a list of options;
However the important steps to approach the questions are explained below.
Overhead is Over-applied when : Applied Overheads > Actual Overheads
The amount of overapplied overheads usually adjust the Cost of Goods Sold as follows :
Cost of Goods Sold (debit)
Overheads (credit)
This entry ensures that the costs of sales are not understated !
Alternatively the over-applied overheads can be adjusted to the Cost of Sales and other Inventory balances at the end of the period in pro-rata (Weight of their total) as follows
Cost of Goods Sold (debit)
Finished Goods Inventory (debit)
Work in Process Inventory (debit)
Raw Materials Inventory (debit)
Overheads (credit)
In _____, organizations receive feedback from the external environment regarding the value of their outputs, the availability of future inputs, and the appropriateness of the transformation process.
Answer:
This question is incomplete, the options are missing. The options are the following:
a) organizational effectiveness
b) closed systems
c) good fit
d) open systems
e) innovative processes
And the correct answer is the option D: open systems.
Explanation:
To begin with, the concept known as "Open Systems" refers to the type of systems that mainly receive their information from external sources but also from internal sources. So those kind of systems are the ones that encourage all the parts to work as a whole in order to obtain better results and that is why that it is in those sytems where the organizations study the feedback that comes from the environment and uses with the purpose of getting better at their operations.
In the MBTI personality model, Disney "imagineers" are more likely to have high _____ scores, while Disney accountants who determine currency transfer equivalencies are more likely to have high _____ scores.
Answer:
In the MBTI personality model, Disney "imagineers" are more likely to have high __INTJ___ scores, while Disney accountants who determine currency transfer equivalencies are more likely to have high __ISTJ___ scores.
Explanation:
1. MBTI personality model is the Myers-Briggs Theory. It was developed by the mother-daughter partnership of Katharine Briggs and Isabel Briggs Myers. At the heart of Myers Briggs theory are four preferences, depicting personality preferences as follows:
1. People and things (Extraversion or "E"), or ideas and information (Introversion or "I").
2. Facts and reality (Sensing or "S"), or possibilities and potential (Intuition or "N").
3. Logic and truth (Thinking or "T"), or values and relationships (Feeling or "F").
4. A lifestyle that is well-structured (Judgment or "J"), or one that goes with the flow (Perception or "P").
These four major classifications mean that one tends to have more of each than the other. This means that there are 16 traits or combinations of traits for a given personality.
2. INTJ personality type: Disney "imagineers" are likely to direct their energies to deal with (Introversion) ideas, information, explanations, and beliefs, as people in research and development at Disney. The information they deal with will be based on ideas, new possibilities, and not obvious things (Intuition) instead of facts and what they know and see. Their decision making will be based on objective logic, using analytic and detailed approaches. Their work will be planned and well-structured to reflect their lifestyle as opposed to flowing with the trend and maintaining flexibility.
3. ISTJ personality class: Disney accountants will bear similar traits like the "imagineers" except that instead of dealing with unknown and not obvious ideas and possibilities like the imagineers, they would prefer their information for processing to be based on clear facts and what they see and know.
Answer:
In the MBTI personality model, Disney "imagineers" are more likely to have high __INTJ___ scores, while Disney accountants who determine currency transfer equivalencies are more likely to have high __ISTJ___ scores.
Explanation:
If merchandise inventory is being valued at cost and the purchase price is steadily falling, which method of costing will yield the largest net income?
Answer:
The answer is LIFO
Explanation:
LIFO is Last in First out. It means the Inventory that was purchased last goes out first.
In periods LIFO, cost of sales reflects the cost of goods purchased recently and the ending Inventory reflects the older goods.
In periods of falling prices, the costs of ending inventory are high, cost of sales are low and the gross profit are high.
Fremont Enterprises has an expected return of 18 % and Laurelhurst News has an expected return of 21 %. If you put 43 % of your portfolio in Laurelhurst and 57 % in Fremont, what is the expected return of your portfolio? g
Answer: 19.29%
Explanation:
From the question, Fremont Enterprises has an expected return of 18% and 57% of the portfolio is put in Fremont. The portfolio return of Fremont will be the expected return multiplied by the weight. This will be:
= 18% × 57%
= 18 × 0.57
= 10.26%
We are also told that Laurelhurst News has an expected return of 21% and that 43% of the portfolio is put in Laurelhurst News. The portfolio return here will be the expected return multiplied by the weight. This will be:
= 21% × 43%
= 21% × 0.43
= 9.03%
The the expected return of the portfolio will now be:
= 10.26% + 9.03%
= 19.29%
Item 11Item 11 You are going to deposit $24,500 today. You will earn an annual rate of 5.5 percent for 8 years, and then earn an annual rate of 4.9 percent for 11 years. How much will you have in your account in 19 years
Answer:
$63,637.94
Explanation:
$24,500 is deposited in the bank
5.5% annual rate will be earned in 8 years
= 5.5/100
= 0.055
4.9% annual rate will be earned in 11 years
= 4.9/100
= 0.049
The first step is to calculate the future value of the amount after 8 years
= amount deposited×(1+r)^n
r is the annual rate, n is the number of years
= $24,500×(1+0.055)^8
= $24,500×1.055^8
= $24,500×1.534686515
= $37,599.8196
Therefore, the amount that would be present in the account in 19 years can be calculated as follows
= amount at the end of year 8×(1+r)^n
where r = 0.049, n= 11
= $37,599.8196×(1+0.049)^11
= $37,599.8196×1.049^11
= $37,599.8196×1.692506597
= $63,637.94
Hence the amount present in the account in 19 years is $63,637.94
If the physical count of inventory showed $158,000 of inventory on hand and the inventory records reported $163,000, what would be the necessary adjusting entry to record inventory shrinkage? a. debit cost of Goods Sold, $163,000; credit Inventory, $158,000 b. debit Inventory, $5,000; credit Cost of Goods Sold, $5,000 c. debit cost of Goods Sold, $5,000; credit Inventory, $5,000 d. debit Inventory, $158,000; credit Cost of Goods Sold, $158,000
Answer:
C. Debit Cost of goods Sold $5,000;
Credit Inventory $5,000
Explanation:
Preparation of the necessary adjusting entry to record inventory shrinkage
Since we assumed that the physical count of inventory showed $158,000 of inventory on hand and the inventory records reported $163,000 the first step to do is to find the difference between the two amount which is ($163,000-$58,000) given us a different of $5,000 which will now be recorded as:
Debit Cost of goods Sold $5,000
(163,000-158,000)
Credit Inventory $5,000
Specter Co. has identified an investment project with the following cash flows. Year Cash Flow 1 $ 820 2 1,130 3 1,390 4 1,525 a. If the discount rate is 10 percent, what is the present value of these cash flows
Answer:
$3,765.26
Explanation:
Present value is the sum of discounted cash flows.
Present value can be calculated using a financial calculator
Cash Flow in year 1 = $ 820
Cash Flow in year 2 = 1,130
Cash Flow in year 3 = 1,390
Cash Flow in year 4 = 1,525
I = 10
PV = $3,765.26
To find the PV using a financial calacutor:
1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.
2. After inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.
3. Press compute
I hope my answer helps you
Suppose we are looking at a cash flow statement constructed using the INDIRECT method. We see a NEGATIVE adjustment of $5000 related to Accounts Payable. Which of the following are correct interpretations of this?a. Depreciation provided cash of $1000 b. The firm sold long-term assets for $1000 c. The firm invested $1000 of cash in long-term assets d. Income was lower by $1000 because of Depreciation expense
Answer:
It implies that the firm paid $5,000 to its supplier this accounting period (e.g. year) out of the amount the firm is owing the supplier.
Note: The correct answer is as stated above it is not included in the option. Kindly confirm the options again from your teacher.
Explanation:
Accounts payable refers to the amount of money a firm is owing its suppliers.
Account payable is one of the component of the current liabilities in the balance sheet, and non-cash current liability item that is adjusted for in the cash flow statement to arrive at net cash from operating activities when an indirect method is being used.
Since accounts payable is the amount of money a firm is owing its suppliers, a negative a NEGATIVE adjustment to its implies that company has paid its supplier the negative amount in the accounting period.
Therefore, a NEGATIVE adjustment of $5000 related to Accounts Payable implies that the firm paid $5,000 to its supplier this accounting period (e.g. year) out of the amount the firm is owing the supplier.
If the fixed costs are $450,000, the unit selling price is $75, and the unit variable costs are $50, what are the old and new break-even sales (units) if the unit selling price increases by $10
Answer:
Old break even points= 18,000 units
New break even points= 12,857 units
Explanation:
The fixed costs are $450,000
The unit selling price is $75
The unit variable costs are $50
The unit selling price have an increase of 10 units
The first step is to calculate the contribution margin per unit
Contribution margin per unit= Selling price per unit-Variable cost per unit
= $75-$50
= $25 per unit
The old break even point can be calculated as follows
= Fixed costs/Contribution margin per unit
= $450,000/$25
= 18,000 units
Since there is an increase in the unit selling price by $10 per unit then, the contribution matgin per unit can be calculated as follows
= $25+$10
= $35
Therefore, the new break even point can be calculated as follows
= $450,000/$35
= 12,857 units
Hence the old break even point and new break even point are 18,000 units and 12,857 units respectively
Costs that remain constant in total dollar amount as the level of activity changes are called Group of answer choices
Answer: Fixed Costs
Explanation:
All of the following are economic resources, or factors of production EXCEPT Group of answer choices land. entrepreneurship. physical capital. money.
Answer:
The correct answer is:
Money
Explanation:
Economic resources or factors of production are the inputs required for the creation of goods or services. They are divided into four categories:
Land: includes physical land and any other natural resources needed for production. Examples are water, natural gas, oil etc. Its reward is rent
Labour: This refers to human efforts contributed to the production of goods or services. Its reward is wages
Capital: this refers to machinery, tools and buildings that are used by humans for production. Its reward is interest
Entrepreneurship: refers to someone who combines the other three factors; land, labour and capital, to earn a profit. Its reward is profit
Money is not a factor of production because it is not directly involved in production of goods or services. However, it facilitates the processes of production like enabling purchase of machinery, payment of wages etc.