Answer:
Licensing
Explanation
Licensing is a contractual agreement whereby one company (the licensor) allows another company to use its trademark for products and services offered by this company (licensee) for a royalty or fee and here royalty was received for the use of name.
Mary-Kate and Ashley Olsen's clothing line with Wal-Mart is an example of celebrity branding. This is where the well-known name of a celebrity is used to market and sell a product or service, in this case, fashion.
Explanation:The scenario involving Mary-Kate and Ashley Olsen and their clothing line with Wal-Mart is an example of celebrity branding. Celebrity branding is a type of branding where a celebrity uses their well-known name to market, promote, and sell a product or service. In this case, the Olsen twins create fashion and grant Wal-Mart exclusive rights to manufacture and sell the clothing under their well-known name. Celebrity branding can significantly influence the consumer's perception of the product and can increase product credibility, thus making it a powerful tool in the marketing sector.
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Cora’s company sold equipment to a competitor on June 1, 2020, where they both agreed to an installment sales contract with a rate of 8%. If this contract requires 8 equal payments due annually starting June 1, 2020, then a:_______.
Answer:
in order for Cora's company to properly record this sale it must use the present value of the future payments.
First it must calculate the 8 equal payments (we could do it using a loan calculator or excel spreadsheet), and then it must calculate the present value of the payments either individually using PV = FV(n) / 1.08ⁿ or by using a table with the future value of the annuity.
Suppose fundamental analysis indicates that XYZ Corporation’s stock is undervalued. Group of answer choices This means its present value is less than its price. You should consider adding the stock to your portfolio. This means its present value is less than its price. You shouldn’t consider adding the stock to your portfolio. This means its present value is more than its price. You should consider adding the stock to your portfolio. This means its present value is more than its price. You shouldn’t consider adding the stock to your portfolio.
You shouldn't add the stock to your portfolio.
This statement is true.
Explanation:
An undervalued stock is characterised as an asset that sells significantly below the supposed intrinsic value at a profit.
For Example, if the stock sells for $50, but on the premise that future cash flows are expected, it is an undervalued stock.
If you pay excessively, you will lose part or all of your earnings. The same happens when you purchase a stock below its current market value. Purchasing an inflated stock ensures you that the chances of losing money even though it is not profitable for the company.
If a company is eliminating certain models of a product and cutting back on expenditures, the product is most likely in the ________ stage of the product life cycle.
The described scenario indicates that the product is likely in the 'decline' stage of its life cycle. This is a part of a strategy to minimize losses due to a product no longer being profitable or competitive. This stage can also lead to an 'exit' scenario in business.
Explanation:When a company is eliminating certain models of a product and reducing its expenditures, it is most likely that the product is in the decline stage of the product life cycle. This is a stage when a product's sales decline and it may no longer be profitable or competitive in the market. Companies typically reduce production, eliminate certain models, and cut back on expenditures such as marketing and distribution. This is done to minimize losses and to transition resources to newer products or other areas of the business. This stage is part of a long-run process of reducing production in response to a sustained pattern of losses, which in business terms is often called exit.
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Total fixed costs for Taylor Incorporated are $ 240 comma 000 . Total costs, including both fixed and variable, are $ 400 comma 000 if 171 comma 000 units are produced. The variable cost per unit is A. $ 3.74 /unit. B. $ 1.40 /unit. C. $ 0.94 /unit. D. $ 2.34/unit.
Answer:
Option (c) is correct.
Explanation:
Given that,
Total fixed costs = $240,000
At the production volume of 171,000 units,
Total cost = $400,000
Total variable cost = Total cost - Total fixed costs
= $400,000 - $240,000
= $160,000
Variable cost per unit:
= Total variable cost ÷ Number of units produced
= $160,000 ÷ 171,000 units
= $0.935 per unit or $0.94 per unit
Assume that an economy described by the Solow model is in a steady state with output and capital growing at 3 percent, and labor growing at 1 percent. The capital share is 0.3. The growth-accounting equation indicates that the contributions to growth of capital, labor, and total factor productivity are:____________-
A) 0.3 percent, 0.7 percent, and 2 percent, respectively.
B) 0.9 percent, 0.7 percent, and 1.4 percent, respectively.
C) 0 percent, 1 percent, and 2 percent, respectively.
D) 1.8 percent, 0.3 percent, and 0.9 percent, respectively.
Answer:
The growth-accounting equation indicates that the contributions to growth of capital, labor, and total factor productivity are 0.9%, 0.7%, and 1.4%, respectively.
Explanation:
Given
Capital growing = 3%
Labor growing = 1%.
Capital share = 0.3
Assuming the economy is in a steady state;
The growth accounting equation is as follows:
GDP Growth = Capital Growth*(Weight of Capital Contribution) + Labor Growth*(Weight of Labor Contribution) + Technological Progress.
Contribution to Growth of Capital = 3% * 0.3 = 0.9%
Contribution to Growth of Labour = (1 - 0.3)% = 0.7%
Total Factor Productivity = 1 + 0.3 + 0.1 = 1.4%
Answer: B. 0.9 percent, 0.7 percent, and 1.4 percent, respectively
Explanation:
The growth accounting equation measures how changes in the Gross Domestic Product (GDP) are influenced by productivity levels due to changes in available capital, labor, and technology.
Output and capital growth = 3%
Labor growth = 1%
Capital share = 0.3
Contribution to capital = capital growth × capital share = 3% × 0.3 = 0.9
Contribution to labor = 1% - 0.3= 0.7
Contribution to total factor of productivity = 1 + 0.3 + 0.1 = 1.4
Which one of the following statements is true?
a) In a job-costing system, individual jobs use different quantities of production resources
b) In a process-costing system each unit uses approximately the same amount of resources.
c) An averaging process is used to calculate unit costs in a job-costing system.
d) Both (a) and (b) are true.
The Statements-In a job-costing system, individual jobs use different quantities of production resources, In a process-costing system each unit uses approximately the same amount of resources.-Both the statement are True
(D) Both (a) and (b) are true.
Explanation:
A job costing system is a system in which the cost associated with a particular job is calculated.This information is important in order to submit the cost information to the customer under a contract
For example:Job costing is required for deriving the cost of construction of a building,for designing a software
Process costing is a term that is used in cost accounting.
It is used to calculate the manufacturing cost of a Product.
A processing cost system is used during the mass production of the identical units .
Ophelia works for Banderos Mexican Grill and is responsible for writing clear communications with employees, as well as for owned, paid, shared, and earned media that reach other publics. This is an example of the ability to write for:________.
This is an example of the ability to write for: Internal and External Publics.
Explanation:
Public relations (PR) presents an important guide for a company and its commodities to assist make assured the organization has the most powerful quality of interactions and concrete public perception. Internal public relations is the conversation that demands the situation within an organization.
Internal PR plays a vital role in the company's achievement. External publics are bodies and organizations that are customers doing business with a firm or company or organization. External Publics focuses on matters concerning the values, strategies, ideas, and perspectives of the company towards different groups of personalities in society.
Use the following two statements to answer this question:I. The average total cost of a given level of output is the slope of the line from the origin to the total cost curve at that level of output.II. The marginal cost of a given level of output is the slope of the line that is tangent to the total cost curve at that level of output.A. I is true, and II is false.B. Both I and II are true.C. I is false, and II is true.D. Both I and II are false.
Answer:
B. Both I and II are true.
Explanation:
It is true that the average total cost of a given level of output is the slope of the line from the origin to the total cost curve at that level of output.
Average Total Cost tends to fall as output increases, and then rise as output continues to increase.
It is also true that the marginal cost of a given level of output is the slope of the line that is tangent to the total cost curve at that level of output.
The slope of the total variable cost curve is marginal cost. The relation between total cost and marginal cost is but another in the long line of applications of the total-marginal relation. The slope of the total cost curve (and total variable cost curve) is marginal cost.
Marginal cost (MC) is calculated by taking the change in total cost between two levels of output and dividing by the change in output. The marginal cost curve is upward-sloping.
The Market for Hotel Rooms. Suppose with no tax the equilibrium price is $110 and the equilibrium quantity is 250. If the local government levies a tax of $30 per night on each hotel room rented, the new equilibrium price will equal _____ and the new equilibrium quantity will equal
Answer:
130, 150
Explanation:
Here, in the question the graph is missing. So, in the attachment the graph is attached.
Equilibrium is the state or condition, where there is balance or stable situation, which means that the opposing forces cancel each other force out and no changes or variations happen or occur.
In short, it is defined as the state where the quantity demanded is equal to the quantity supplied, where there is no loss to the business.
From the graph, we could analyze that the new equilibrium price is 130 and at this price, the new equilibrium quantity is 150.
Suppose the economy is initially in long-run equilibrium then aggregate demand rises. What will happen in the long run?
Answer with Explanation:
Once the aggregate demand rises, this means that the consumers have the capacity or are willing to purchase more of the goods and services. Once this happens for a prolonged period of time, inflation will result. This means that the prices of goods will increase at the same quantity being offered.
The increase in the prices of goods happens because once the demand of the consumer increases, the producers would try their best to meet that demand. This is effective in the short-run. However, it is hard to accommodate such huge demand in the long-run. So, this mean that the producers will have to increase the price level of the goods. This will then lower the aggregate expenditures of the consumers.
So, this explains the answer.
An account that will have a zero balance after closing entries have been journalized and posted is
Answer:
An account with a zero balance after closing entries have been journalized and posted is an account in good standing.
Temporary or nominal accounts such as revenue, expense, and dividend accounts are the ones that will have a zero balance after closing entries are completed.
An account that will have a zero balance after closing entries have been journalized and posted typically refers to temporary or nominal accounts in accounting. These accounts include revenue, expense, and drawing accounts for proprietorships and partnerships or dividends for corporations. After closing entries are made, these temporary accounts are reset to a zero balance, transferring their balances to permanent accounts like Retained Earnings or Capital accounts to reflect the revenue, expenses, and distributions for the next accounting period.
The process is a key part of the accounting cycle and ensures that accounts reflect the correct amounts when a new period begins. It is grounded in the double-entry bookkeeping system, where every transaction is entered in at least two accounts, maintaining the balance of the accounting equation which consists of Assets = Liabilities + Owner's Equity.
The VP of Manufacturing at Roshanak Incorporated wants to buy a new die cast machine for production. The die cast machine is expected to cost around $1,000,000. Which document will most likely be used to solicit bids from suppliers
Answer:
RFP ( Request for proposal)
Explanation:
Request for proposal is considered as a business document and it not only announces but also it provides the details about the project. it also plead bids from the various contractors that will also help in the completion of the project. Many organization and firms always choose to use RFP (Request for proposal). Basically, RFP is used by the law enforcement agencies in order to get the lowest bid.
The perceThe percentage change in the price level from one time period to the next, whether the price level is measured in terms of money or as a price index, will be the _____________.ntage change in the price level from one time period to the next, whether the price level is measured in terms of money or as a price index, will be the _____________.inflation rateprice index rateconsumer price indexproducer price Index
Answer:
Consumer Price Index
Explanation:
The percentage change in the price level from one time period to the next, whether the price level is measured in terms of money or as a price index, will be the Consumer Price Index
The Consumer Price Index tracks changes in the cost of living over time
It also measures the change in the retail prices of a broad range of specific goods and services.
The percentage change in price level from one time period to the next is the inflation rate, calculated using a basket of goods and price index numbers, though it is subject to substitution and quality/new goods biases.
Explanation:The percentage change in the price level from one time period to the next, whether the price level is measured in terms of money or as a price index, will be the inflation rate. Economists measure the price level by using a basket of goods and services and calculating how the total cost of buying that basket of goods will increase over time. This cost is often expressed in terms of price index numbers, which transform the cost into a series of numbers in the same proportion to each other, typically basing it on a standard year set to 100. To measure economic inflation, the inflation rate is gauged as the percentage change between these price levels or index numbers from one period to another.
However, two significant problems can affect the accuracy of this measurement: substitution bias, where consumers may change their buying patterns in response to price changes, and quality/new goods bias, where improvements in product quality or new products introduced to the market can affect the price level.
Simon Peters, a senior manager at Celise Export Logistics, goes to France to negotiate a deal with the company's French partners. He dresses casually in a t-shirt and jeans. His French counterparts call off the meeting and accuse him of taking a casual attitude toward negotiations. In this scenario, dressing formally during business meetings is probably a cultural _____ for the French
In this scenario, dressing formally during business meetings is probably a cultural imperative for the French
Explanation:
Cultural imperatives are traditions that you have to comply with when you want to succeed.
Relationship building is an example of a cultural imperatives .
Business understands the importance of building a relationship in many Asian countries such as China and Japan and Latin America.
Businessmen are not doing company business, they are doing business with people. It is a cultural necessity to spend time developing this relationship in these countries before you start up your business. Always underestimate your business partners ' value in building trust. It makes or breaks an agreement. Among Asian countries, another moral necessity is to make no one lose face. Never raise your voice or publicly threaten anyone. You will struggle in your company if you are ignorant of these cultural imperatives.
34. A small company that shovels sidewalks and driveways has 100 homes signed up for its services this winter. It can use various combinations of capital and labor: lots of labor with hand shovels, less labor with snow blowers, and still less labor with a pickup truck that has a snowplow on front. To summarize, the method choices are: Method 1: 50 units of labor, 10 units of capital Method 2: 20 units of labor, 40 units of capital Method 3: 10 units of labor, 70 units of capital If hiring labor for the winter costs $100/unit and a unit of capital costs $400, what production method should be chosen
Answer: The last part of the question is missing which says ; what production method should be chosen? what production method should be chosen if the cost of labor rises to $200/unit.?
Explanation:
Since we are given that cost of labor $100/unit and cost of capital is $400/unit and since it is apparent that labor is cheaper than capital, hence method 1 should be chosen.
total cost of production in method 1;= ($50 x $100) + ($10 x $400) = $9000
total cost of production in method 2;= ($20 x $100) + ($40 x $400) = $18000
total cost of production in method 3;= ($50 x $100) + ($70 x $400) = $29000
As such, method 1 is the cheapest and should be chosen.
Similarly, if the price of labor rises to $200, then the total cost of production is calculated thus ;
total cost of production in method 1;= ($50 x $200) + ($10 x $400) = $14000
total cost of production in method 2;= ($20 x $200) + ($40 x $400) = $20000
total cost of production in method 3;= ($10 x $200) + ($70 x $400) = $30000
even as the cost of labor increases to $200, also method 1 should be chosen as it has the lowest total cost of production.
The company should choose Method 1, which involves 50 units of labor and 10 units of capital, as the most cost-effective production method.
Explanation:In order to determine the most cost-effective production method, we need to calculate the total cost of each method. Method 1 costs 50 * $100 for labor and 10 * $400 for capital, giving a total cost of $5,000 + $4,000 = $9,000. Method 2 costs 20 * $100 for labor and 40 * $400 for capital, giving a total cost of $2,000 + $16,000 = $18,000. Method 3 costs 10 * $100 for labor and 70 * $400 for capital, giving a total cost of $1,000 + $28,000 = $29,000.
From these calculations, we can see that Method 1 has the lowest total cost at $9,000. Therefore, the company should choose Method 1 as the most cost-effective production method.
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The total factory overhead for Rowland Company is budgeted for the year at $652,000 and divided into two departments: Fabrication $460,000 and Assembly $192,000. Rowland manufactures two products: treadmills and weight machines. Each treadmill requires 3 direct labor hours in Fabrication and 1 direct labor hour in Assembly. Each weight machine requires 2 direct labor hours in Fabrication and 5 direct labor hours in Assembly. Each product is budgeted for 4,000 units of production for the year.
Determine the factory overhead allocated per unit for each weight machine, using the department factory overhead allocation rates.
a. $77.00
b. $163.00
c. $86.00
d. $81.50
Answer: $86.00
Explanation: A department factory overhead rate is calculated as budgeted department factory overhead divided by budgeted department allocation base. The overhead rate is then multiplied by the dhls for each product individually
Fabrication dlh (4,000 treadmills × 3 dlh) + (4,000 weight machines × 2 dlh) = 20,000dlh
$460,000 / 20,000 dlh = $23 per dlh
Assembly dhl (4,000 treadmills × 1 dlh) + (4,000 weight machines × 5 dlh) = 24,000 dlh
$192,000 / 24,000 dlh = $8 per dlh
Weight Machine:
Fabrication: 2 dlh × $23 per dlh = $46
Assembly: 5 dlh × $8 per dlh = 40
Therefore: Allocation per unit $86.00
Economic growth will A. be faster if more capital per hour is used because of increasing returns to capital. B. slow down or stop if more capital per hour is used because of diminishing returns to capital. C. not be affected because the key to economic growth is capital accumulation whether there are diminishing returns or not. D. not be sustained if developing countries stop accumulating capital because of diminishing returns to capital. Some economies are able to maintain high growth rates despite diminishing returns to capital by using A. better or enhanced technology, along with accumulating capital; these economies are growing because technology, unlike capital, is subject to increasing returns. B. a larger proportion of capital, thereby making their production capital intensive, so the sheer volume of capital protects them from diminishing returns to capital. C. a labor-intensive technology because labor, unlike capital, is not subject to diminishing returns. D. a newer production method that, if used properly, produces increasing returns to capital.
Answer: B and A
Explanation: Economic growth is the increase in the productive capacity of the economy. There will be a decrease in economic growth if more capital per hour is used as a result of the diminishing returns to capital.
Some economies maintain high growth rates despite diminishing returns to capital through the use of enhanced or better technology, coupled with accumulating capital. There are growth in such economies because unlike capital, technology is subject to increasing returns.
Answer:
1. D. not be sustained if developing countries stop accumulating capital because of diminishing returns to capital.
2. A. better or enhanced technology, along with accumulating capital; these economies are growing because technology, unlike capital, is subject to increasing returns.
Explanation:
Economic growth will not be sustained if developing countries stop accumulating capital because of diminishing returns to capital.
Capital formation and accumulation increases investment which effects economic development or growth in two ways. Firstly, it increases the per capita income and enhances the purchasing power which, in turn, creates more effective demand. Secondly, investment leads to an increase in production.
Some economies are able to maintain high growth rates despite diminishing returns to capital by using A. better or enhanced technology, along with accumulating capital; these economies are growing because technology, unlike capital, is subject to increasing returns.
Technological development is an important factor that increases the growth rate of economy at the macro level and profits of the firms at micro level.
The yurdone corporation wants to set up a private cemetery business. according to the cfo, barry m. deep, business is "looking up." as a result, the cemetery project will provide a net cash inflow of $107,000 for the firm during the first year, and the cash flows are projected to grow at a rate of 3 percent per year forever. the project requires an initial investment of $1,600,000. a-1 what is the npv for the project if yurdone's required return is 12 perce
Answer:
Net Present Value for this project is -411,111.11
Explanation:
Net Present Value is the difference between present values of future cash flows and present value of future cash outflows. Since, the outflows are paid today, we don't need to discount them.
Since we have indefinite period of time and expected net cash inflow of 107,000$ after first year, where it is expected to grow annually at 3%, we can use following formula:
P V = F V / i-g, where g is annual growth rate of future cash inflow. Therefore, we will have P V = 1,188,888. In order to calculate N P V we need to calculate the difference between P V and initial investments. Finally, we get -411,111.11
Calculating the NPV of the Yurdone Corporation's proposed cemetery business using the growing perpetuity formula shows a negative NPV of -$411,111.11, indicating that it may not be a profitable investment at a 12% required return.
The Yurdone Corporation is considering setting up a private cemetery business, expecting a net cash inflow of $107,000 in the first year, with cash flows projected to grow at a rate of 3% annually. The initial investment required is $1,600,000. To calculate the project's Net Present Value (NPV) given a required return of 12%, we use the formula for a growing perpetuity: NPV = (Cash Flow Year 1 / (Required Return - Growth Rate)) - Initial Investment. Thus, NPV = ($107,000 / (0.12 - 0.03)) - $1,600,000 = $107,000 / 0.09 - $1,600,000 = $1,188,888.89 - $1,600,000 = -$411,111.11. Therefore, given a required return of 12%, the NPV for the Yurdone Corporation's cemetery project would be negative, suggesting that this may not be a viable investment under these conditions.
Michael is preparing the company's cash budget. when preparing the cash disbursements section, he includes inventory, labor, overhead, selling expenses, administrative expenses, depreciation, dividends, and income taxes. what error did michael make? will cash disbursements be too high or too low as a result of this mistake?
a.michael failed to include credit sales in his estimate, which would make cash disbursements too low.
b.michael included depreciation in his estimate, which would make cash disbursements too high.
c.michael failed to include financing in his estimate, which would make cash disbursements too low.
d.michael included income taxes in his estimate, which would make cash disbursements too high.
Answer:
b.michael included depreciation in his estimate, which would make cash disbursements too high.
Explanation:
Cash disbursement is defined as outflow of cash that is paid in the process of obtaining goods and services. Cash disbursement can also be in the form of refunds to a customer or dividend payments.
Items we can include in cash disbursement include: inventory, labor, overhead, selling expenses, administrative expenses, dividends, and income taxes.
Depreciation is not part of cash disbursement as it does not involve outlay of cash, but rather reduction in value if assets.
Answer:
The correct option is (C). Michael failed to include financing in his estimate, which would make cash disbursements too low.
Explanation:
Financing is a big source of cash disursement since projects and programmes must be funded to get completed. Therefore, it will certainly make cash disbursement too low because a big spending source was ommitted as a mistake.
Which of the following is not typical of traditional costing systems? Use of direct labor hours or direct labor cost to assign overhead. Use of multiple cost drivers to allocate overhead. Use of a single predetermined overhead rate. Assumption of correlation between direct labor and incurrence of overhead cost.
Answer:
The correct answer is use of multiple cost drivers to allocate overhead
Explanation:
Use of direct labor hours or direct labor cost to assign overhead to products is typical of traditional costing systems as overhead is believed to have positive relationship with labor-related variables.
Besides,using a business-wide or plant-wide single predetermined overhead rate is not feature of traditional systems of costing.
Since labor-related variables such as direct labor hours or direct labor cost is assumed to be a driver of overhead cost,hence an appropriate overhead absorption basis,it is perfectly understood that there is correlation between direct labor and incurrence of overhead cost in the business.
HearIT, Inc., sells headphones and other listening devices. HearIT buys the goods from manufacturers and then resells them directly to consumers. HearIT does not pay cash to the manufacturers, but instead buys the inventory on credit, giving a security interest to the manufacturer. HearIT sells Judy a pair of headphones that later are repossessed by the manufacturer when HearIT fails to pay the manufacturer. In this situation, HearIT most likely violated:____________
Answer:
A warranty of no liens
Explanation:
HearIT has violated the warranty of no liens
Warranty: This can be defined as the assurance usually given by the seller of the existence of a fact on which the buyer can rely. Giving warranty is the duty of the seller, so buyers can sue the sellers in case of any breach in the agreement. instance, we have express warranty, warranty of title, implied warranty.
1) Warranty of Title
a) No Liens: Sellers usually give assurance to the customers that they are selling goods free from debt.
As in the case of HearIT, he has violated this contract by selling goods to Judy that are later repossesed by the manufacturer because the goods were bought on credit and HearIT failed to pay the manufacturer.
b) Good Title:This is the assurance given by the seller that the goods are not stolen goods.
2) No Infringements: It us a warranty given by the sellers to the buyers that their commodities are free from all kinds of infringement like patent right, copyright.
Except where disclaimed, a seller warrants that the goods delivered are free from any copyright, trademark, or patent claims by a third party.
Except where disclaimed, sellers warrant that they have good and valid title to the goods being sold and that they have the power to rightfully transfer title to the buyer. In other words, the goods aren’t stolen.
Except disclaimed, sellers warrant that the goods they are selling are free of any liens -- that is, any encumbrance on the goods or other property to satisfy a debt or protect a claim for payment of a debt (e.g., a security interest on personal property or a mortgage on real property).
2) Express warranty
3) Implied warranty
Martha claims that she has been assigned marginal job roles or light workloads that don't lead to promotion. Which of the following terms accurately explains the type of discrimination she has been subjected to?
A) intimidation
B) sexual harassment
C) exclusion
D) inclusion
E) insult
A special-interest issue is one that a. allocates the cost of the activity in accordance with the benefits received. b. benefits a small, well-organized interest group at the expense of taxpayers or consumers. c. benefits everyone and imposes a cost on everyone. d. benefits a small, well-organized interest group but makes that group pay for the cost of the program.
Answer:
The correct answer is b. benefits a small, well-organized interest group at the expense of taxpayers or consumers.
Explanation:
The expression "special interests" is known. It refers to people and groups of them who lobby. This means trying to influence political authority according to their belief agenda.
It is a kind of political activism. A topic that is worth a second opinion.
In short, it is the group of people who try to influence government decisions according to the ideas that this group supports. An essential characteristic of these groups is that they do not try to become a government, but to influence already elected rulers or by being elected.
These groups receive other names, such as lobbyists, lobbying groups, activist groups.
Sales in North Corporation increased from $60,000 per year to $63,000 per year while net operating income increased from $10,000 to $12,000. Given this data, the company's degree of operating leverage must have been:
Answer:
degree of operating leverage= 4
Explanation:
Giving the following information:
Sales in North Corporation increased from $60,000 per year to $63,000 per year while net operating income increased from $10,000 to $12,000.
The degree of operating leverage is the %change in the operating income, divided by the change in sales. It measures how much of the operating income varies with changes in sales.
degree of operating leverage= % change on income/ % change on sales
degree of operating leverage= [(12,000 - 10,000)/10,000] / [(63,000 - 60,000)/60,000]
degree of operating leverage= 0.2 / 0.05= 4
Final answer:
The degree of operating leverage for North Corporation is 4, calculated by dividing the 20% increase in net operating income by the 5% increase in sales.
Explanation:
The degree of operating leverage which is a financial concept used to describe the relationship between a company's fixed and variable costs, and its effect on the company's net operating income when sales change. In the given scenario, North Corporation's sales increased from $60,000 to $63,000, which is a 5% increase. Its net operating income increased from $10,000 to $12,000 which is a 20% increase. The degree of operating leverage can be calculated at any point by taking the percentage change in operating income and dividing it by the percentage change in sales. Therefore, the degree of operating leverage for North Corporation would be 20% / 5% = 4.
A closed economy a. does not engage in international trade of goods and services. b. does not engage in international borrowing or lending. c. both A and B d. engages in international borrowing and lending.
Answer:
The correct option is C,both A and B
Explanation:
A closed economy is not opened to the idea of international trade, where its surplus commodities can be traded with other nations of the world in order to earn foreign exchange while at the same procuring from trading partners products required by its nationals not available at all in the economy or the ones that are not available in the required quantity.
A closed economy also assumes itself to be sufficient in the area of fiscal policy management by not engaging in international borrowing or lending arrangements.
The Jackson Company incorrectly omitted $100,000 of merchandise from its 20X1 ending inventory. In addition, a merchandise purchase of $40,000 was incorrectly recorded as a $4,000 debit to the purchases account. As a result of these errors, 20X1 before-tax income is:___________.1. Overstated by $136,0002. Understated by $136,0003. Overstated by $640004. Undersated by $64000
Answer:
Option "4" is the correct answer to the following statement.
Explanation:
Step 1: Company omitted $100,000 from Stock account, it will Increase Cost of goods sold by $100,000
and also Profit by $100,000
Step 2: Purchase account debited by $4000 Would decrease the Cost of goods sold by ($40,000 - $4,000) $36,000 and decrease Profit by the same amount.
Total understate income = $100,000 - $36,000
= $64,000