The government has set a maximum price of $3 for paper towels, which means that paper towels cannot be sold for a price higher than $3.
This policy is designed to make paper towels more affordable for consumers.
However, when the price is set below the equilibrium price, it creates a shortage in the market.
The equilibrium price is the price at which the quantity supplied equals the quantity demanded. In this case, the equilibrium price is above $3.
When the price is set below the equilibrium price, suppliers are not willing to supply as much as consumers want to buy at that price.
As a result, there is excess demand or a shortage of paper towels in the market.
To understand this concept, imagine a scenario where the equilibrium price is $4. At this price, the quantity demanded and supplied are balanced.
But when the government sets a maximum price of $3, suppliers may be less willing to supply paper towels, as the price is lower than what they are willing to sell for.
This shortage can lead to other issues, such as black markets or consumers searching for alternative products.
It's important for policymakers to consider the potential consequences of price controls like this.
Learn more about maximum price:
https://brainly.com/question/12336267
#SPJ11
Following are examples of BOP transactions from US perspective, Which transactions are recorded on the credit side (cash inflow) of balance of payment?
.A. Honda US is the distributor of cars manufactured in Japan by its parent, Honda of Japan.
.B. US based firm, Fluor Corp., manages the construction of a major water treatment facility in Bangkok, Thailand.
.C. US subsidiary of French firm, Saint Gobain, pays profits (dividends) back to parent firm in Paris
.D. n American tourist purchases a small Lapponia necklace in Finland
.E. A Mexican lawyer purchases a US corporate bond through an investment broker in Cleveland
Group of answer choices
A,C,E
A,D,E
C,D,E
A,C,D
Balance of payment refers to the record of all transactions between the residents of a country with the rest of the world during a particular period. Transactions in the BOP statement are categorized into two categories: Credit and Debit. Credit entries in the BOP statement represent the flow of funds into the country.
Hence, given the following examples, the transactions that are recorded on the credit side of the BOP statement are:Option A: Honda US is the distributor of cars manufactured in Japan by its parent, Honda of Japan. Since Honda US is the distributor of cars manufactured in Japan, this means that they are importing cars to the US. Therefore, this transaction will be recorded on the credit side of the BOP statement as there is an inflow of foreign currency.Option C: The US subsidiary of the French firm, Saint Gobain, pays profits (dividends) back to the parent firm in Paris.
Since the US subsidiary is paying profits to the parent company in Paris, this implies that they are making an outward remittance. Hence, this transaction will be recorded on the credit side of the BOP statement.Option E: A Mexican lawyer purchases a US corporate bond through an investment broker in Cleveland. This implies that a foreign investor is investing in US bonds, and hence, there is an inflow of foreign currency. Therefore, this transaction will be recorded on the credit side of the BOP statement.Therefore, the transactions recorded on the credit side of the BOP statement are A, C, and E. Hence, the correct option is A,C,E.
To know more about transactions visit:
https://brainly.com/question/24730931
#SPJ11
List three (3) advantages why a firm would consider using a third-party warehousing firm instead of having their own private warehouses. (3 marks available)
There are several advantages that a firm can obtain by using a third-party warehousing firm instead of having its own private warehouses. Advantages of a third-party warehousing firm: Reduced overhead costs: A third-party warehousing firm can provide a lot of services that a business would have to invest in if it were to establish its own warehousing facility.
When using a third-party firm, a business can avoid the expense of hiring employees, equipment rental, and purchasing or leasing warehouse space.
Additionally, the company can avoid the costs associated with maintaining and managing a warehouse facility.
This means that a business may be able to save a significant amount of money by utilizing a third-party warehousing company.
2. Increased flexibility: A third-party warehousing firm can be more flexible than a business' own warehouse, particularly when it comes to adjusting to fluctuations in demand.
Since the third-party company is not dedicated solely to the business, it has a broader scope and can make modifications to its operations more quickly than a business can.
This can help a company respond to changes in demand more rapidly and effectively, ensuring that it meets its customers' needs.
3. Improved location: A third-party warehousing company may have a facility in a more advantageous location than a company's own warehouse.
This could be due to the fact that the third-party company has numerous warehouses and can choose to operate in a place that is better suited for the business.
The location of a warehouse can have a significant effect on shipping times, transportation expenses, and other logistical factors that may influence a company's operations.
As a result, being able to utilize a third-party warehouse in a more beneficial location may be a significant advantage for a business.
Know more about overhead costs here:
https://brainly.com/question/13037939
#SPJ11
answer the following questions for each cases listen below (a-e)
what is the best form for the contract involved in this situation (written/verbal/tacit/mixed)?What formalities are required by law for a contract in this situation?What formalities might the one or both parties require to make the contract valid and/or enforceable?
a Starting a part-time job at a restaurant.
b Renting a room in a house from a friend.
c. Promising to donate money to a charity if a marathon runner completes a race.
d. Starting a gym contract.
e.Subscribing to a magazine
a. Starting a part-time job at a restaurant:The best form for the contract involved in this situation is a written contract.
b. Renting a room in a house from a friend:The best form for the contract involved in this situation is a written contract.
c. Promising to donate money to a charity if a marathon runner completes a race:The best form for the contract involved in this situation is a written contract.
d. Starting a gym contract:The best form for the contract involved in this situation is a written contract.
e. Subscribing to a magazine:The best form for the contract involved in this situation is a written contract.
a. Starting a part-time job at a restaurant:
Best form: Written contract
Required formalities: No specific legal formalities
Additional formalities: Signing the contract,specifying employment details, and meeting any legal requirements.
b. Renting a room in a house from a friend:
Best form: Written contract
Required formalities: No specific legal formalities
Additional formalities: Signing the contract, clarifying rental terms, and complying with local rental laws.
c. Promising to donate money to a charity if a marathon runner completes a race:
Best form: Written contract
Required formalities: No specific legal formalities
Additional formalities: Signing the contract, specifying donation conditions, and following any legal requirements for charitable donations.
d. Starting a gym contract:
Best form: Written contract
Required formalities: No specific legal formalities
Additional formalities: Signing the contract, understanding membership terms, and adhering to any gym policies.
e. Subscribing to a magazine:
Best form: Written contract
Required formalities: No specific legal formalities
Additional formalities: Subscription confirmation (verbal or written), understanding subscription terms, and following any cancellation policies.
To know more about legal formalities visit:
https://brainly.com/question/32927561
#SPJ11
Which type of evidence listed below would not be helpful in recording a transaction? a. A sales catalogue b. A credit card receipt C. An invoice d. A purchase order
In recording transactions, there are a number of evidence types that are considered very crucial. They include sales catalogues, credit card receipts, invoices and purchase orders.
Among these, one of them is not helpful in recording a transaction. That would be the sales catalogue.A sales catalogue is a document that lists the items a business has for sale. It serves as a type of advertisement, showing the product, the price, and a brief description. This type of document is used to lure prospective customers and entice them to make purchases from the business.
This is because it doesn't provide any details about the specific transaction that took place. As such, it can't be used as evidence when keeping accounting records.
To know more about evidence visit :
https://brainly.com/question/31812026
#SPJ11
Create a budget for a rugby tournament for kids
between 6 to 12 years old.
The budget includes two parts: revenue and
expenditure.
For each input, explain your decision to have it in the balance
sheet
To create a budget for a rugby tournament for kids between 6 to 12 years old, you will need to consider both revenue and expenditure.
Here's a explanation of how to create the budget:
1. Revenue:
- Registration Fees: Determine the amount of money to be collected from each participant as a registration fee. This fee will contribute to the revenue and can be used to cover various tournament expenses.
- Sponsorships: Seek out potential sponsors, such as local businesses or organizations, who may be willing to contribute financially to the tournament in exchange for advertising or other benefits.
- Donations: Consider accepting donations from individuals or organizations who wish to support the tournament.
2. Expenditure:
- Venue Rental: Allocate a portion of the budget to cover the cost of renting a suitable venue for the tournament. Consider factors like field rental fees, lighting, and other facilities.
- Equipment: Determine the cost of purchasing or renting necessary rugby equipment, such as balls, goal posts, cones, and jerseys.
- Referees: Set aside a budget for hiring qualified referees for the tournament. Consider the number of matches and the duration of the tournament when estimating this cost.
- First Aid and Medical Services: Allocate funds for medical supplies, first aid kits, and the presence of medical professionals to ensure the safety and well-being of the participants.
- Trophies and Awards: Consider the cost of purchasing trophies or medals for the winners and participants of the tournament.
- Marketing and Promotion: Allocate funds for marketing and promotion activities, such as creating flyers, banners, or online advertisements to attract participants and spectators.
- Miscellaneous Expenses: Account for any other miscellaneous expenses that may arise during the tournament, such as transportation costs, insurance, or administrative fees.
It's important to note that the specific amounts allocated to each category may vary depending on factors such as the size of the tournament, the number of participants, and the availability of sponsorships and donations.
Additionally, it's advisable to create a contingency fund to cover unexpected expenses that may arise during the tournament.
To know more on Budget visit:
https://brainly.com/question/31952035
#SPJ11
1. Did the nursery owner violate Darlene’s rights?
2. When Darlene first became uncomfortable with the nursery owner's behaviour, what should she have done?
3. What Grounds of Discrimination can be identified in Darlene’s case?
The nursery owner violated Darlene's rights because Darlene is protected under the Equality Act 2010 and the nursery owner discriminated against her on the grounds of her age and gender.
When Darlene first became uncomfortable with the nursery owner's behaviour, she should have reported it to a manager or supervisor.
In Darlene's case, the grounds of discrimination that can be identified are age and gender. The nursery owner made comments that were discriminatory towards Darlene based on her age.
To know more about protected visit:
https://brainly.com/question/14456790
#SPJ11
ABC, a CPA firm that practices in the US, is engaged to audit XYZ Ltd., an Italian firm that
is not listed on a stock exchange. ABC’s financial statements will be used only outside the US.
ABC should comply
(a) With International Standards on Auditing, but not with the US generally accepted auditing
standards.
(b)With International Standards on Auditing and US generally accepted auditing standards,
except for requirements related to the form and content of the report.
c) None of the above.
In this scenario, ABC, a CPA firm in the US, is engaged to audit XYZ Ltd., an Italian firm that is not listed on a stock exchange. The financial statements of XYZ Ltd. will be used only outside the US.
In such a situation, ABC should comply with International Standards on Auditing (ISA) because the audit is being performed for a foreign entity. ISA provides guidelines and standards for auditors to ensure consistent and high-quality audits worldwide.
However, ABC should not comply with the US generally accepted auditing standards (GAAS) because the financial statements of XYZ Ltd. will only be used outside the US. GAAS is specific to the US and is not applicable in this case.
Therefore, the correct answer is (a) ABC should comply with International Standards on Auditing but not with the US generally accepted auditing standards.
It is important for auditors to follow the appropriate auditing standards based on the jurisdiction and the purpose of the audit. By adhering to ISA, ABC can ensure that the audit of XYZ Ltd. is conducted in accordance with internationally recognized standards for auditing.
Learn more about audit from the given link.
https://brainly.com/question/29575176
#SPJ11
ELECTRICITY SUPPLY. Consider an electricity market where there are three suppliers, each with constant marginal cost (a reasonable approximation in electricity generation). Firm 1 has a capacity of 200 and MC=5. Firm 2 has a capacity of 100 and MC=8. Firm 3 has a capacity of 100 and MC=10. Suppose that suppliers act as price takers.
(a) Determine the industry supply curve.
(b) Suppose that market demand is given by Q=540−20p. Determine the market equilibrium. Is this equilibrium a long-run equilibrium?
(c) Suppose that
(i) demand falls to D(p)=400−20p;
(ii) Firm 3 reduces its MC to 8;
(iii) Firm 2 reduces its MC to 7 . What happens to equilibrium profits in each case?
a) Industry supply curve is the sum of the individual supply curves which is explained. ; b) 540 - 20p = Quantity Supplied. ; c) By comparing the equilibrium profits in each scenario to the initial equilibrium profits, we estimated changes in demand and marginal costs affect firm profits in(I),(it) and (iii).
(a) To determine the industry supply curve, we need to add up the individual supply curves of each firm. The supply curve shows the quantity of electricity each firm is willing to supply at different prices.
For Firm 1, with a capacity of 200 and a marginal cost (MC) of 5, the supply curve is as follows:
Price (p) | Quantity Supplied
--------------------------------
5 | 200
6 | 200
7 | 200
... | ...
Similarly, for Firm 2 with a capacity of 100 and MC of 8, the supply curve is:
Price (p) | Quantity Supplied
--------------------------------
8 | 100
9 | 100
10 | 100
... | ...
And for Firm 3 with a capacity of 100 and MC of 10, the supply curve is:
Price (p) | Quantity Supplied
--------------------------------
10 | 100
11 | 100
12 | 100
... | ...
To determine the industry supply curve, we add up the quantities supplied by each firm at each price level. The industry supply curve is the sum of the individual supply curves, as follows:
Price (p) | Quantity Supplied
--------------------------------
5 | 200
6 | 200
7 | 200
8 | 200
9 | 200
10 | 300
11 | 200
12 | 100
... | ...
(b) To determine the market equilibrium, we need to find the price and quantity at which the industry supply curve intersects the market demand curve.
The market demand is given by Q = 540 - 20p, where Q represents the quantity demanded and p represents the price. To find the equilibrium, we need to set the quantity demanded equal to the quantity supplied. So, we have:
540 - 20p = Quantity Supplied
Substituting the values from the industry supply curve, we get:
540 - 20p = Quantity Supplied
At equilibrium, the quantity demanded and supplied are equal, so we solve for p:
540 - 20p = Quantity Supplied
(c) In this part, we are given three scenarios:
(i) Demand falls to D(p) = 400 - 20p.
(ii) Firm 3 reduces its MC to 8.
(iii) Firm 2 reduces its MC to 7.
To analyze the impact of these changes on equilibrium profits, we need to re-calculate the market equilibrium in each scenario and compare the results.
(i) If demand falls to D(p) = 400 - 20p, we follow the same steps as in part (b) to find the new equilibrium price and quantity. Once we find the new equilibrium, we can calculate the new equilibrium profits for each firm using their respective supply curves.
(ii) If Firm 3 reduces its MC to 8, we update the supply curve for Firm 3 to reflect the new marginal cost. We then follow the same steps as in part (b) to find the new equilibrium and calculate the new equilibrium profits.
(iii) If Firm 2 reduces its MC to 7, we update the supply curve for Firm 2 to reflect the new marginal cost. We again follow the same steps as in part (b) to find the new equilibrium and calculate the new equilibrium profits.
Know more about market equilibrium,
https://brainly.com/question/29618306
#SPJ11
Using examples, differentiate between standardization and
customization of production. Discuss the pros and cons of each
operational decision.
(150 words)
Standardization refers to the production of identical products in mass quantities. For example, fast-food chains produce standard meals such as hamburgers and fries in large quantities.
1. Lower costs: Standardization helps to reduce production costs since companies can produce large quantities of products at a lower cost per unit.
2. Consistent quality: Standardization ensures that products are consistent in terms of quality and features.
However, there are also cons of standardization such as:
1. Limited product variety: Standardization limits product variety since companies produce identical products.
2. Less customer satisfaction: Standardization may not meet the specific needs of all customers, which can lead to less customer satisfaction.
To know more about Standardization visit:
https://brainly.com/question/31979065
#SPJ11
You have just taken out a five-year loan from a bank to buy an engagement ring. The ring costs $6,500. You plan to put down $1,400 and borrow $5,100. You will need to make annual payments of $1,250 at the end of each year. Show the timeline of the loan from your perspective. How would the timeline differ if you created it from the bank's perspective? How would the timeline differ if you created it from the bank's perspective? (Select the best choice below.) E You have just taken out a five-year loan from a bank to buy an engagement ring. The ring costs $6,500. You plan to put down $1,400 and borrow $5,100. You will need to make annual payments of $1,250 at the end of each year. Show the timeline of the loan from your perspective. How would the timeline differ if you created it from the bank's perspective? Show the timeline of the loan from your perspective. (Select the best choice below.) How would the timeline differ if you created it from the bank's perspective? (Select the best choice below.)
The timeline of the loan includes the initial purchase of the engagement ring, and making annual payments for five years. the timeline from the bank's perspective, it would include the loan disbursement, receiving annual payments, and the eventual repayment of the loan.
The timeline of the loan would start with the purchase of the engagement ring for $6,500. You would then make a down payment of $1,400 and borrow the remaining amount of $5,100. Over the next five years, you would make annual payments of $1,250 at the end of each year until the loan is fully repaid.
From the bank's perspective, the timeline would start with the loan disbursement of $5,100 to you. Then, over the next five years, the bank would receive annual payments of $1,250 at the end of each year as per the loan agreement. The timeline would end with the full repayment of the loan.
So, while the basic structure and duration of the loan are the same from both perspectives, the perspective determines the focus on who is making the payments and who is receiving them.
Learn more about loan here:
https://brainly.com/question/30015539
#SPJ11
Keynes argued that roal consumption and saving decisions depond pimarly on a hounehold texpeted future income A. True B. false
Keynes emphasized the importance of expected future income in influencing household consumption and saving decisions.
Keynes argued that household consumption and saving decisions primarily depend on the household's expected future income. In other words, a household's consumption and saving behavior are influenced by their expectations of how much income they will have in the future.
Keynes believed that when households expect their future income to be higher, they are more likely to increase their consumption and spend more. On the other hand, when households expect their future income to be lower, they are more likely to reduce their consumption and save more. This is because households tend to adjust their spending habits based on their expectations of their financial situation in the future.
For example, if a household expects to receive a higher income next year, they might decide to purchase a new car or take a vacation, thus increasing their consumption. On the other hand, if a household expects their income to decrease in the future, they might choose to save more and reduce their current spending.
The correct answer to the question is A. True.
learn more about income from given link
https://brainly.com/question/30157678
#SPJ11
Steel Inc. has 6 percent coupon bond on the market with 10 years
to maturity, and the par value of $1,000. The bonds make
semi-annual coupon payments and currently sell for $1,102.5. What
is the YTM?
To calculate the yield to maturity (YTM) of the bond, we need to use the bond pricing formula.
The formula is:
Bond Price = C * [1 - (1 + r)^(-n)] / r + (F / (1 + r)^n)
Where:
- Bond Price is the current market price of the bond ($1,102.5)
- C is the coupon payment per period (6% * $1,000 / 2 = $30)
- r is the YTM (what we want to find)
- n is the total number of periods (10 years * 2 = 20)
Using this formula, we can substitute the known values and solve for r:
$1,102.5 = $30 * [1 - (1 + r)^(-20)] / r + ($1,000 / (1 + r)^20)
To find the YTM, we can use numerical methods or financial calculators.
Using an online calculator or financial software, we find that the YTM for this bond is approximately 2.68%.
Therefore, the YTM of the bond is 2.68%.
learn more about YTM from the given link
https://brainly.com/question/457082
#SPJ11
The marketing mix is the set of controllable, tactical marketing tools that the firm blends to produce the response it wants in the target market.
Discuss how KIA succeeded in differentiating and positioning its products for maximum competitive advantage in the marketplace?
Kia has succeeded in differentiating and positioning its products by offering innovative designs, competitive pricing, wide availability, and effective marketing strategies. Through a combination of these marketing mix elements, Kia has established itself as a reputable and competitive brand in the automotive industry.
The marketing mix is a combination of controllable marketing tools that a firm uses to influence its target market. It consists of four elements, also known as the 4Ps: product, price, place, and promotion. Kia, a popular automotive brand, has successfully differentiated and positioned its products to gain a competitive advantage in the marketplace.
1. Product: Kia focuses on developing innovative and high-quality vehicles that meet the needs and preferences of its target market. For example, Kia has introduced hybrid and electric models to cater to the growing demand for environmentally-friendly cars. By offering a diverse range of products, Kia ensures that it caters to various customer segments and differentiates itself from competitors.
2. Price: Kia strategically prices its products to appeal to its target market while maintaining profitability. They offer competitive prices that are often lower than their competitors. This pricing strategy helps Kia attract cost-conscious customers and positions the brand as a value-for-money option in the market.
3. Place: Kia has a strong distribution network that ensures its products are widely available to customers. They have dealerships and showrooms in key locations, making it convenient for customers to access their products. Additionally, Kia has expanded its global presence by establishing manufacturing facilities in different countries.
4. Promotion: Kia invests heavily in marketing and promotion to create brand awareness and generate customer interest. They utilize various advertising channels, such as television, digital platforms, and sponsorships, to reach their target audience. Kia also focuses on building emotional connections with customers through engaging and memorable marketing campaigns.
Know more about marketing mix
https://brainly.com/question/859394
#SPJ11
Keynes stipulated that there are two determinants of investment.
they are:
9 of 25 Keynes stipulated that there are two determinants of investment. They are O disposable income and wealth. O expected future profits and interest rates. O price and quantity. O interest rates a
Keynes stipulated that the two determinants of investment are expected future profits and interest rates.
Investment decisions are influenced by various factors, and Keynes identified expected future profits and interest rates as the primary determinants. Expected future profits refer to the anticipated profitability of an investment project or venture. If businesses anticipate higher future profits, they are more likely to invest in expanding their operations or undertaking new projects. On the other hand, if they expect lower profits, investment may be curtailed or postponed.
Interest rates also play a crucial role in investment decisions. When interest rates are low, borrowing costs decrease, making it more attractive for businesses to obtain financing for investment purposes. Lower interest rates can stimulate investment by reducing the cost of capital and increasing the potential return on investment. Conversely, higher interest rates can discourage borrowing and lead to a decrease in investment activity.
In summary, Keynes emphasized that expected future profits and interest rates are the key determinants of investment. The anticipation of higher profits encourages investment, while interest rates influence the cost of borrowing and the attractiveness of investment opportunities.
Learn more about investment
brainly.com/question/17252319
#SPJ11
(The following information applies to the questions displayed below.) Henna Company produces and sells two products, Carvings and Mementos. It manufactures these products in separate factories and markets them through different channels. They have no shared costs. This year, the company sold 60,000 units of each product. Income statements for each product follow. Sales Variable costs Contribution margin Fixed costs Income Carvings $ 1,020,000 612,000 408,000 258,000 $ 150,000 Mementos $ 1,020,000 204,000 816,000 666,000 $ 150,000 Required: 1. Compute the break-even point in dollar sales for each product. (Enter CM ratio as percentage rounded to 2 decimal places.) PRODUCT CARVINGS Contribution Margin Ratio Numerator: 1 Denominator: 1 II Contribution margin ratio 0 Break-Even Point in Dollars Numerator: 1 Denominator: / II Break-even point in dollars 0 PRODUCT MEMENTOS Contribution Margin Ratio = Contribution margin ratio 0 Break-Even Point in Dollars 1 11 Break-even point in dollars 0 2. Assume that the company expects sales of each product to decline to 43,000 units next year with no change in unit selling price. Prepare a contribution margin income statement for the next year (as shown above with columns for each of the two products). (Round "per unit" answers to 2 decimal places.) HENNA COMPANY Contribution Margin Income Statement Carvings Mementos Units S Per unit Total $ Per unit Total Total 0 $ 0 0 0 0 Contribution margin 0 Income (loss) $ 0 0 $ 0 3. Assume that the company expects sales of each product to increase to 74,000 units next year with no change in unit selling price. Prepare a contribution margin income statement for the next year (as shown above with columns for each of the two products). (Round "per unit" answers to 2 decimal places.) HENNA COMPANY Contribution Margin Income Statement Carvings Mementos Units S Per unit Total S Per unit Total $ 0 Total 0 $ 0 0 0 0 Contribution margin 0 Income (loss) $ 이 $ 0 $ 0
To compute the break-even point in dollar sales for each product, we need to find the sales level at which the contribution margin equals the fixed costs.
For Carvings:
- Contribution Margin Ratio = Contribution Margin / Sales = $408,000 / $1,020,000 = 0.4 or 40%
- Break-Even Point in Dollars = Fixed Costs / Contribution Margin Ratio = $258,000 / 0.4 = $645,000
For Mementos:
- Contribution Margin Ratio = Contribution Margin / Sales = $816,000 / $1,020,000 = 0.8 or 80%
- Break-Even Point in Dollars = Fixed Costs / Contribution Margin Ratio = $666,000 / 0.8 = $832,500
So, the break-even point in dollar sales for Carvings is $645,000, and for Mementos, it is $832,500.
Now, let's move on to the next part of the question.
Assuming the company expects sales of each product to decline to 43,000 units next year with no change in unit selling price, we can prepare a contribution margin income statement for the next year.
HENNA COMPANY Contribution Margin Income Statement:
Carvings:
- Units Sold: 43,000
- Sales: $43,000 * $1,020,000 / 60,000 = $731,000
- Variable Costs: $43,000 * $612,000 / 60,000 = $438,600
- Contribution Margin: Sales - Variable Costs = $731,000 - $438,600 = $292,400
- Fixed Costs: $258,000 (as given)
- Income (Loss): Contribution Margin - Fixed Costs = $292,400 - $258,000 = $34,400
Mementos:
- Units Sold: 43,000
- Sales: $43,000 * $1,020,000 / 60,000 = $731,000
- Variable Costs: $43,000 * $204,000 / 60,000 = $146,200
- Contribution Margin: Sales - Variable Costs = $731,000 - $146,200 = $584,800
- Fixed Costs: $666,000 (as given)
- Income (Loss): Contribution Margin - Fixed Costs = $584,800 - $666,000 = -$81,200 (Loss)
So, the contribution margin income statement for the next year would be:
Carvings:
- Sales: $731,000
- Variable Costs: $438,600
- Contribution Margin: $292,400
- Fixed Costs: $258,000
- Income: $34,400
Mementos:
- Sales: $731,000
- Variable Costs: $146,200
- Contribution Margin: $584,800
- Fixed Costs: $666,000
- Income: -$81,200 (Loss)
Assuming the company expects sales of each product to increase to 74,000 units next year with no change in unit selling price, we can prepare a contribution margin income statement for the next year.
HENNA COMPANY Contribution Margin Income Statement:
Carvings:
- Units Sold: 74,000
- Sales: $74,000 * $1,020,000 / 60,000 = $1,254,000
- Variable Costs: $74,000 * $612,000 / 60,000 = $752,800
- Contribution Margin: Sales - Variable Costs = $1,254,000 - $752,800 = $501,200
- Fixed Costs: $258,000 (as given)
- Income: Contribution Margin - Fixed Costs = $501,200 - $258,000 = $243,200
Mementos:
- Units Sold: 74,000
- Sales: $74,000 * $1,020,000 / 60,000 = $1,254,000
- Variable Costs: $74,000 * $204,000 / 60,000 = $251,600
- Contribution Margin: Sales - Variable Costs = $1,254,000 - $251,600 = $1,002,400
- Fixed Costs: $666,000 (as given)
- Income: Contribution Margin - Fixed Costs = $1,002,400 - $666,000 = $336,400
So, the contribution margin income statement for the next year would be:
Carvings:
- Sales: $1,254,000
- Variable Costs: $752,800
- Contribution Margin: $501,200
- Fixed Costs: $258,000
- Income: $243,200
Mementos:
- Sales: $1,254,000
- Variable Costs: $251,600
- Contribution Margin: $1,002,400
- Fixed Costs: $666,000
- Income: $336,400
For more questions on: fixed costs.
https://brainly.com/question/20670674
#SPJ8
Why is it important for governments to tax individuals and
businesses?
* Prepare a short essay
Taxation is the primary source of income for governments, and it plays an essential role in the economy. Tax revenue is used by governments to provide essential services.
1. Funding Public Services:
Governments need funding to provide essential services to their citizens. The taxes levied on individuals and businesses are the primary source of revenue for governments to fund public services. This revenue is used to build roads, schools, hospitals, and other infrastructure, which benefits everyone in the society.
2. Redistributing Income:
The tax system can be used as a tool for income redistribution. The government can tax the rich and wealthy individuals and businesses more heavily, while providing tax breaks for the lower-income groups. This helps reduce income inequality and ensures that everyone in the society has access to basic services.
3. Controlling Inflation:
Taxation can be used as a tool to control inflation. If the economy is growing too fast, the government can increase taxes to reduce the amount of money in circulation, which helps control inflation.
To know more about inflation visit:
brainly.com/question/28136474
#SPJ11
What is not a reconciling item? A. A deposit in transit B>. Acheck O C. An adjusted bank balance O
D An outstanding check
Option C, an adjusted bank balance, is not a reconciling item.
Which of the following is not a reconciling item?
Option C. An adjusted bank balance is not a reconciling item. Bank reconciliation is the procedure of matching and comparing the information in the bank statement with the cash balance in a company's accounting records as of a certain date.
There are a variety of reasons why the cash balance reported in the bank statement varies from the balance in the company's accounting records. These disparities must be reconciled to determine the correct balance. This is accomplished by identifying the factors that caused the variations and making the necessary adjustments.
Therefore, an adjusted bank balance is not a reconciling item. In fact, it is the final balance that occurs after all the reconciling items are addressed.
To know more about reconciling. please visit.....
brainly.com/question/29562773
#SPJ11
Huckleberry Apiary is a leading consulting business that specializes in teaching farmers how to rame bees. Its accounting records reported the following data on December 31, 2019 Accounts appear in no partic order (Click the icon to view the accounts.) Prepare the unadjusted trial balance of Huckleberry Apiary at December 31, 2010 List the accounts in the order of assets, abilities, owner's equites, revenues, and experien Complete the heading and then the body of the unadjusted trial balance for Hucklebony Apiary of a box is not used, leave the box empty; do not enter "0") - X Accounts Supples Equipment Accounts Payable S Seville Capital Consulting Revenue 4 $7,200 S Sevile Withdrawals Cash 1,700 Supples Expense 1.100 14.500 Accounts Recevable 31,000 Done $5,300 14,500 5,900 12.000 Time Remaining: 01:47:36 Next
The unadjusted trial balance of Huckleberry Apiary at December 31, 2019 is as follows:
AssetsCash $1,700Accounts Receivable $31,000Supplies $7,200Equipment $5,300Total Assets $45,200LiabilitiesAccounts Payable $14,500Total Liabilities $14,500Owner's EquityS Seville Capital $12,000Consulting Revenue $5,900Supplies Expense $1,100Total Owner's Equity $19,000Total Liabilities and Owner's Equity $33,500Explanation:The unadjusted trial balance is used to verify the total debits and credits of all ledger accounts, including the balance sheet and income statement accounts. It aids in the identification of errors and in the preparation of adjusting entries.In the order of assets, liabilities, owner's equity, revenues, and expenses, the accounts should be listed.
To know more about trial balance, visit:
https://brainly.com/question/31039973
#SPJ11
Which of the following statement is false? Select one: a. A preferred vendor can be entered for inventory part items. b. The description entered in the sales information section of the new item window for inventory part items will appear on invoices and sales receipts. C. The COGS Account field for an inventory part item represents the account that will be debited when an inventory part is sold. * d. The cost entered when setting up an inventory part item is used to value the inventory.
Statement c is false because the COGS Account field does not represent the account that will be debited when an inventory part is sold. Instead, the Inventory Asset account is debited.
a. A preferred vendor can be entered for inventory part items. - This statement is true. In inventory management, a preferred vendor can be designated to streamline purchasing processes and maintain good relationships with suppliers.
b. The description entered in the sales information section of the new item window for inventory part items will appear on invoices and sales receipts. - This statement is true. When creating an inventory part item, the description entered in the sales information section will be displayed on invoices and sales receipts.
c. The COGS Account field for an inventory part item represents the account that will be debited when an inventory part is sold. - This statement is false. The COGS (Cost of Goods Sold) account is not debited when an inventory part is sold. Instead, the Inventory Asset account is debited for the cost of the item sold, and the COGS account is credited to recognize the expense.
d. The cost entered when setting up an inventory part item is used to value the inventory. - This statement is true. The cost entered when setting up an inventory part item is used to determine the value of the inventory and is essential for calculating the cost of goods sold.
Learn more about Inventory from this link:
https://brainly.com/question/26977216
#SPJ11
oliver is a licensed lawyer in florida. he has lived in florida for three years. assuming he passes the background check and has his application accepted, what else must he do to become a licensed sales associate in florida?
To become a licensed sales associate in Florida, in addition to passing the background check and having his application accepted, Oliver must complete the necessary pre-licensing education, pass the Florida Real Estate Sales Associate Examination, submit his fingerprints for a criminal background check, and secure sponsorship from a licensed real estate broker
1: Education Requirement: Oliver needs to complete a 63-hour pre-licensing course from a state-approved real estate school. This course covers various topics such as real estate principles, laws, contracts, and financing.
2: Background Check: Oliver must pass a thorough background check conducted by the Florida Department of Business and Professional Regulation (DBPR). This includes a fingerprinting process to ensure he has no disqualifying criminal history.
3: Application Submission: Oliver needs to submit an application to the DBPR, along with the necessary fees and supporting documents. The application requires providing personal information, educational qualifications, and employment history.
4: State Exam: After the application is accepted, Oliver must pass the Florida Real Estate Sales Associate Exam. This exam tests his knowledge of real estate laws, practices, and ethical standards. The exam consists of multiple-choice questions and is administered by the DBPR.
5: License Activation: Once Oliver successfully passes the state exam, he will be issued a Florida sales associate license. To activate the license, he must find a sponsoring broker who will oversee his real estate activities and complete the necessary paperwork with the DBPR.
6: Continuing Education: To maintain his sales associate license, Oliver must complete 14 hours of approved continuing education courses every two years. These courses help him stay updated with changes in laws, regulations, and industry practices.
By following these steps, Oliver can fulfill the requirements to become a licensed sales associate in Florida and pursue a career in real estate.
For more such questions on licensed sales, click on:
https://brainly.com/question/13774797
#SPJ8
Identify opportunities and threats faced by incumbents now and in future by applying Porter’s five forces and PEST to identify key industry current situation and future trends Key takeaway of this analysis is the threats or opportunities for industry participants and what they must do/have to succeed for Mccain food company.
In order to identify opportunities and threats faced by incumbents, we can apply Porter's five forces and PEST analysis to understand the key industry current situation and future trends.
Porter's five forces framework includes analyzing the bargaining power of buyers, bargaining power of suppliers, threat of new entrants, threat of substitute products or services, and intensity of competitive rivalry. By examining these forces, we can identify potential threats and opportunities.
PEST analysis involves evaluating the political, economic, social, and technological factors that can impact the industry. This analysis helps in understanding the external environment and identifying trends that may affect incumbents in the future.
For McCain Food Company, the key takeaway of this analysis would be to identify the threats and opportunities for the industry participants. This would help them understand what actions they need to take in order to succeed. For example, if the analysis reveals a high threat of substitute products, McCain Food Company may need to focus on product innovation and differentiation to stay competitive.
In summary, by applying Porter's five forces and PEST analysis, McCain Food Company can identify the threats and opportunities in the industry and develop strategies to succeed in the current situation and future trends.
Learn more about the PEST analysis
https://brainly.com/question/33756528
#SPJ11
It is now January 1. You plan to make a total of 5 deposits of $100 each, one every 6 months, with the first payment being made today. The bank pays nominal interest rate of 8% but uses semiannual compounding. You plan to leave the money in the bank for 10 years. Do not round intermediate calculations. Round your answers to the nearest cent.
a. How much will be in your account after 10 years?
$
b. You must make a payment of $1,744.06 in 10 years. To get the money for this payment, you will make five equal deposits, beginning today and for the following 4 quarters, in a bank that pays a nominal interest rate of 8% with quarterly compounding. How large must each of the five payments be?
$
According to the given statement a. After 10 years, there will be approximately $219.10 in the account. b. Each of the five payments must be approximately $938.55.
a. To calculate the amount in your account after 10 years, we can use the formula for compound interest:
A = P(1 + r/n)^(nt)
Where:
A is the future value of the account
P is the principal amount (initial deposit)
r is the nominal interest rate (as a decimal)
n is the number of times interest is compounded per year
t is the number of years
In this case, P = $100, r = 8% = 0.08, n = 2 (semiannual compounding), and t = 10. Plugging these values into the formula:
A = $100(1 + 0.08/2)^(2*10)
A = $100(1.04)^20
A ≈ $100(2.191)
A ≈ $219.10
So, after 10 years, there will be approximately $219.10 in your account.
b. To find the size of each payment, we can use the formula for the future value of an annuity:
FV = P((1 + r/n)^(nt) - 1)/(r/n)
Where:
FV is the future value of the annuity
P is the payment amount
r is the nominal interest rate (as a decimal)
n is the number of times interest is compounded per year
t is the number of years
In this case, FV = $1,744.06, r = 8% = 0.08, n = 4 (quarterly compounding), and t = 10. We need to solve for P. Plugging these values into the formula:
$1,744.06 = P((1 + 0.08/4)^(4*10) - 1)/(0.08/4)
Simplifying the equation:
$1,744.06 = P(1.02^40 - 1)/0.02
$1,744.06 = P(1.859)
P ≈ $938.55
So, each of the five payments must be approximately $938.55.
a. To calculate the future value of an investment, we use the formula for compound interest. We plug in the given values and calculate the amount in the account after 10 years. Semiannual compounding means that interest is added twice a year.
b. To determine the size of each payment, we use the formula for the future value of an annuity. We plug in the given values and solve for the payment amount. Quarterly compounding means that interest is added four times a year.
In conclusion a. After 10 years, there will be approximately $219.10 in the account. b. Each of the five payments must be approximately $938.55.
To know more about account visit:
https://brainly.com/question/30977839
#SPJ11
Select an existing company, at your choice, preparing to introduce a new product/ service in the market
or
Imagine a new company to create, preparing to enter in a specific market with a new product/service
Describe the activity of the company, main product(s) or services, overall coverage (target groups, geographic coverage)
Develop a marketing opportunity analysis to identify the main external and internal factors impacting your business opportunities (use the discussed analysis frames)
Realize the industry analysis
Realize the competitive analysis
Based on Porter 5 forces frame, decide if it’s a good business decision to introduce the new product/ service in the market
Specify what types of marketing research you intend to use in order to analyze the marketing opportunities for your company/ brand or product
Considering the Apple Watch, its target group, geographic coverage, and conducting thorough analyses, introducing the new product in the market can be a good business decision. Apple's strong brand, global presence, and ongoing innovation contribute to its potential success.
To select an existing company preparing to introduce a new product/service, let's consider Apple Inc. Apple is a global technology company known for its innovative products. It recently introduced the Apple Watch, a wearable device that combines fitness tracking, communication, and other features.
The main target group for the Apple Watch includes tech-savvy individuals interested in fitness and convenience. Apple's geographic coverage is worldwide, as it operates in numerous countries.
To conduct a marketing opportunity analysis, we need to consider both external and internal factors. Externally, we can assess factors like market size, customer needs, and trends. Internally, we can analyze Apple's resources, capabilities, and brand reputation.
For industry analysis, we can examine the smartwatch market, including competitors, growth potential, and regulatory factors.
Competitive analysis involves evaluating the strengths and weaknesses of competitors like Samsung and Fitbit, assessing their strategies and market share.
Using Porter's Five Forces framework, we can assess the industry's competitiveness. Factors like supplier power, buyer power, threat of substitutes, and barriers to entry should be considered.
To analyze marketing opportunities, Apple could employ various marketing research methods, such as surveys, focus groups, and online data analysis, to gather insights on customer preferences, market trends, and competition.
Learn more about business decision from the link:
https://brainly.com/question/27004710
#SPJ11
Coral Company accounts for noncurrent assets using the cost model. On July 31, 2011, Coral classified a noncurrent asset as held for sale. At that date, the asset's carrying amount was P1,450,000, its fair value was estimated at P2,150,000 and the cost to sell at P150,000. The asset was sold on January 31, 2012 for P2,120,000. At what amount should the asset be measured in Coral's statement of financial position on December 31, 2011? a. 2,000,000 b. 2,150,000 c. 2,120,000 d. 1,450,000
The asset should be measured at P2,150,000 in Coral's statement of financial position on December 31, 2011. The correct answer is B.
When a noncurrent asset is classified as held for sale, it is recognized at the lower of its carrying amount or fair value with fewer costs to sell. In this case, the asset's carrying amount was P1,450,000, and its fair value was estimated at P2,150,000. Since the fair value of P2,150,000 is higher than the carrying amount, the asset should be measured at its fair value.
Therefore, on December 31, 2011, the asset should be measured at P2,150,000 in Coral's statement of financial position, reflecting its estimated fair value.
To learn more about asset click here
https://brainly.com/question/29482245
#SPJ11
The economy of Hoosierland is described by the following set of equations: C=50+.8(Y−T), T=0, I=400−25i, L=350+.4Y−50i, M=150, G=50, 1250=500+0.8(1250)−25(14) 1250=1500−350 1250=1150 where C is private consumption; Y is national income; T is taxes; I is investment; i is the interest rate; L is money demand; M is the money supply; and G is government demand for private sector output. a. Find the equilibrium level of output and the market clearing interest rate. b. If the government wishes to raise Y to 1250 , how much should it increase G ? 100 c. Alternatively, if the government wishes to achieve the output level 1250 through expansionary monetary policy, how much should the Fed increase M?
a. The equilibrium level of output and the market clearing interest rate depend on each other.
b. To raise Y to 1250, the government should increase G by 5000.
c. To achieve the output level of 1250 through expansionary monetary policy, the Fed should increase M by 49200.
To find the equilibrium level of output and the market clearing interest rate, we need to solve the system of equations.
Given:
C = 50 + 0.8(Y - T)
T = 0
I = 400 - 25i
L = 350 + 0.4Y - 50i
M = 150
G = 50
We can start by substituting T = 0 into the consumption equation:
C = 50 + 0.8Y
Next, substitute the given values of I, L, and G into the national income equation:
Y = C + I + G + L - M
Y = (50 + 0.8Y) + (400 - 25i) + 50 + (350 + 0.4Y - 50i) - 150
Simplifying the equation, we get:
Y = 850 + 1.2Y - 75i
Rearranging the equation, we find:
0.2Y = 850 - 75i
Now, substitute the value of Y into the investment equation to solve for i:
I = 400 - 25i
400 - 25i = 400 - 25i
0 = 0
This means the investment equation doesn't provide any new information.
To find the equilibrium level of output and the market clearing interest rate, we need to solve the national income equation:
0.2Y = 850 - 75i
To find Y, divide both sides of the equation by 0.2:
Y = (850 - 75i) / 0.2
So, the equilibrium level of output depends on the interest rate.
For part b, if the government wants to raise Y to 1250, we can substitute this value into the national income equation:
1250 = (850 - 75i) / 0.2
Solving for i, we find:
i = (850 - 1250) / -0.2
i = -200 / -0.2
i = 1000
To find how much G should increase, substitute the new value of i into the national income equation:
1250 = (850 - 75(1000)) / 0.2
1250 = (850 - 750) / 0.2
1250 = 5000
Therefore, G should increase by 5000.
For part c, to achieve the output level of 1250 through expansionary monetary policy, we need to find the new money supply M.
Substitute the new value of Y into the national income equation:
1250 = (850 - 75i) / 0.2
Solving for i, we find:
i = (850 - 1250) / -0.2
i = -200 / -0.2
i = 1000
Now, substitute the new value of i into the money demand equation:
L = 350 + 0.4Y - 50i
L = 350 + 0.4(1250) - 50(1000)
L = 350 + 500 - 50000
L = -49200
Since the money demand cannot be negative, the Fed should increase the money supply M by 49200.
Learn more about equilibrium level:
https://brainly.com/question/17193674
#SPJ11
Definition and recognition of financial statement elements
Golden Wattle Accountants Ltd was established on 1 June 20X6. On 1st June the office manager prepaid insurance worth $1 200 for the coming six months and correctly recognised this as an asset.
Required:
Using the definitions and recognition criteria from the Conceptual Framework, what Golden Wattle Ltd should recognise with regard to the prepaid insurance at 30 June 20X6.
At 30 June 20X6, Golden Wattle Ltd should recognize the prepaid insurance as an asset on its financial statements. Prepaid insurance meets the definition of an asset as it represents a future economic benefit resulting from a past transaction (payment of insurance premium).
It also meets the recognition criteria as it is probable that the company will obtain the future economic benefits associated with the prepaid insurance and the cost can be reliably measured. Therefore, it should be recognized as an asset on the balance sheet at its original cost of $1,200 at 30 June 20X6. According to the Conceptual Framework for Financial Reporting, an asset is defined as a resource controlled by an entity as a result of past events, and from which future economic benefits are expected to flow to the entity. Prepaid insurance fits this definition because Golden Wattle Ltd made a payment of $1,200 for insurance coverage that will provide future economic benefits (insurance coverage) over the next six months. In addition to meeting the definition of an asset, the prepaid insurance also satisfies the recognition criteria. It is probable that the company will benefit from the insurance coverage since it has already paid for it, and the cost of the prepaid insurance can be reliably measured at $1,200. Therefore, Golden Wattle Ltd should recognize the prepaid insurance as an asset on its balance sheet at its original cost of $1,200 as of 30 June 20X6.
Learn more about recognition criteria here:
https://brainly.com/question/32700923
#SPJ11
Below Claire has several bank transactions that need to be recorded in her check register (Click HERE for the check registry). Help her by listing them in order, adding or deducting in the appropriate section, and calculating the correct balance after every transaction.
1. Claire's beginning balance in her account is $1092.09
2. On May 27 , she received her direct deposit from Merrill Lynch Payroll for $1126.32
3. On May 27, she writes check #107 to her Bank of Georgia for her mortgage payment, for $1100.00
4. On May 28 , she uses her debit card at Foodland for $83.52.
5. On June 1, she writes check #108 for $356.32 to Bank of Atlanta for your car payment.
6. On June 2, her electronic bill pay writes check 800 to Telecom Phone Service for $62.77.
7. On June 2, she uses her ATM card to withdraw $200.00 for concert tickets.
8. On June 15 , she uses her debit card at Gifts Plus to buy a $75.86 birthday present for her mother.
9. On June 15 , she received a refund from her old insurance company the Duck for $313.00
10. On June 19 , she uses her electronic bill pay to write check #801 $446.45 to State Ranch to cover car insurance premium.
11. On June 24 , she uses her debit card at Gas Up to fill up her car for $65.88.
12. On June 28, she uses her debit card for a rental car from Rental Genie for $50.33 for a road trip with her friends.
On the same document, answer the following questions.
1. What was the account balance on May 30 ?
2. Could Claire have paid her car insurance payment on June 10 instead of June 19 ? If not, why?
3. The love of Claire's life has been in a bad mood lately, and she thinks an expensive present might help. She found a leather jacket on sale for $89.00. Can she afford to buy the jacket on June 8 ? What will her account balance be if she does?
4. What was the account balance after Claire paid for the rental car on June 28?
The account balance after Claire paid for the rental car on June 28 is $1068.08.
Explanation :
1. To calculate the account balance on May 30, we need to consider all the transactions that occurred before May 30.
First, we start with the beginning balance of $1092.09. Then, we add the direct deposit of $1126.32 on May 27. Next, we deduct the check payment of $1100.00 on the same day.
So, the account balance on May 30 is:
Beginning balance + Direct deposit - Check payment = $1092.09 + $1126.32 - $1100.00 = $1118.41
2. Claire could not have paid her car insurance payment on June 10 instead of June 19 because the refund from her old insurance company on June 15 covers part of the car insurance premium. If she had paid it earlier, she would not have had enough funds in her account to cover the payment.
3. To check if Claire can afford to buy the leather jacket on June 8, we need to calculate the account balance after that purchase.
Starting with the account balance on June 8, we subtract the cost of the leather jacket: $1118.41 - $89.00 = $1029.41.
So, if Claire buys the jacket on June 8, her account balance will be $1029.41.
4. To find the account balance after Claire paid for the rental car on June 28, we need to deduct the rental car cost from the previous balance.
Starting with the account balance before the rental car payment, we subtract the rental car cost: $1118.41 - $50.33 = $1068.08.
Learn more about insurance from a given link :
https://brainly.in/question/31023355
#SPJ11
please explain the benefit and limitations between build your
own e-commerce versus outsourcing?
Building your own e-commerce offers customization but requires technical expertise, while outsourcing provides convenience but limits customization.
Building your own e-commerce platform allows you to have complete control over the design, functionality, and features of your online store. This level of customization can be beneficial for businesses with unique requirements or specific branding needs. Additionally, building your own e-commerce platform gives you the freedom to make changes and updates as needed, without relying on external parties.
However, building your own e-commerce platform requires technical expertise and resources. It involves tasks such as coding, server management, security implementation, and payment integration. This can be time-consuming and may require hiring specialized developers or investing in training. Furthermore, maintaining and updating the platform over time can be an ongoing responsibility that requires additional resources and knowledge.
On the other hand, outsourcing e-commerce development to a third-party provider can offer convenience and expertise. These providers have experience in building and managing e-commerce platforms, which can result in faster implementation and reduced time to market. Outsourcing also allows businesses to focus on their core competencies while leaving the technical aspects to professionals.
However, outsourcing e-commerce development may limit the level of customization available. Depending on the provider and the chosen package, customization options may be limited to predefined templates or themes. Moreover, outsourcing can involve higher costs, as you'll be paying for the expertise and services provided by the external provider. Additionally, relying on external providers means that you'll have to communicate and coordinate with them for any updates or changes.
Ultimately, the decision between building your own e-commerce platform and outsourcing depends on your business's specific needs, resources, and priorities. While building your own platform offers greater control and potential cost savings in the long run, outsourcing provides convenience and expertise, allowing you to focus on other aspects of your business.
Learn more about e-commerce here:
https://brainly.com/question/29732698
#SPJ11
A machine purchased three years ago for $316,000 has a current book value using straight-line depreciation of $177,000; its operating expenses are $31,000 per year. A replacement machine would cost $237,000, have a useful life of eleven years, and would require $11,000 per year in operating expenses. It has an expected salvage value of $64,000 after eleven years. The current disposal value of the old machine is $75,000; if it is kept 11 more years, its residual value would be $16,000. Calculate the total costs in keeping the old machine and purchase a new machine. Should the old machine be replaced?
The total costs of keeping the old machine for 11 more years would include the operating expenses and the disposal value.
Total costs of keeping the old machine : Operating expenses for 11 years = $31,000/year * 11 years = $341,000 Salvage value after 11 years = $64,000Operating expenses for 11 years = $31,000/year * 11 years = $341,000 Disposal value = $75,000 Total costs of keeping the old machine = $341,000 + $75,000 = $416,000 Total costs of purchasing a new machine = $237,000 + $121,000 - $64,000 = $294,000 Since the total costs of purchasing a new machine are lower than the total costs of keeping the old machine, it would be more cost-effective to replace the old machine with a new one.The total costs for purchasing and operating the new machine are lower than the costs of keeping the old machine. Therefore, it would be more cost-effective to replace the old machine with the new one.
learn more about:- operating expenses here
https://brainly.com/question/15080057
#SPJ11
Questions 1-6 are on Lucas's "The Industrial Revolution."
[5] According to Lucas what are the benefits to a poor country from trading with more advanced countries?
[6] According to Lucas what tendencies are "most poisonous" to the "sound economics" that promotes growth and rising living standards?
These factors are often recognized as potential hindrances to economic growth and rising living standards.
According to Lucas, there are certain tendencies that he considers "most poisonous" to sound economics, which in turn hinder growth and rising living standards. These tendencies include:
1. High and unpredictable inflation: When inflation is high and unpredictable, it can create uncertainty and instability in the economy. This makes it difficult for businesses and individuals to plan for the future, invest, and make sound economic decisions.
2. Excessive government intervention: Lucas argues that excessive government intervention in the economy can hinder growth. This includes regulations, subsidies, and other policies that distort market forces and discourage private sector investment and innovation.
3. Inefficient tax systems: A complex and inefficient tax system can create disincentives for work, saving, and investment. It can also lead to tax evasion and reduced economic activity.
4. Trade barriers: Lucas suggests that barriers to international trade, such as tariffs and quotas, can limit economic growth and reduce the benefits of specialization and comparative advantage.
5. Lack of property rights and rule of law: Without strong property rights and the rule of law, individuals and businesses may be hesitant to invest and engage in economic activities. This can hinder economic growth and development.
6. Political instability: Political instability, such as frequent changes in government or policy, can create uncertainty and discourage investment. It can also lead to a lack of confidence in the economy and hinder growth.
It's important to note that these tendencies are based on Lucas's perspective and there may be other viewpoints on what factors are "most poisonous" to sound economics. However, these factors are often recognized as potential hindrances to economic growth and rising living standards.
Learn more about
Political instability
https://brainly.com/question/32035873
#SPJ11
