Answer:
the amount that debited to the cash account is $10,670
Explanation:
The computation of the amount that debited to the cash account is shown below:
= Account receivable - discount allowed
= $11,000 - $11,000 × 3%
= $11,000 - $330
= $10,670
Hence the amount that debited to the cash account is $10,670
We simply applied the above formula so that the correct value could come
And, the same is to be considered
If XYZ common stock has a $4 dividend, a yield of 4.2%, a price-to-earnings (P/E) ratio of 12, and it is trading at $96, its approximate earnings per share (EPS) is
Answer:
$8
Explanation:
According to the given situation, the computation of earnings per share is shown below:-
Earnings per share = Stock price ÷ Price-to-earnings
= $96 ÷ 12
= $8
Therefore we have applied the above formula to determining the earnings per share.
The same is to be considered
We simply divided the stock price by the price to earning so that the earning per share could come
Bronski Corporation manufactures two products, Simple and Complex. The following information was gathered: Simple Complex Selling price per unit $37.00 $26.00 Variable cost per unit $32.00 $22.00 Total fixed costs are $18,000. Assume demand for either product exceeds the factory's capacity. It takes one hour of production time to make Simple and two hours to make Complex. The annual capacity of the plant is 10,000 hours. How many units of Simple and Complex should Bronski Corporation produce and sell to maximize profits
Answer:
The answer is "Option A".
Explanation:
Please find the correct question and its solution file.
industry studies suggest that design activities introduce __ of all errors during the software process
Answer:
This question speaks to Computer Science.
The missing word is Correction.
Thus the complete sentence is: Industry studies suggest that design activities introduce correction of all errors during the software development process.
Explanation:
Requirements engineering is a branch of software development which appraises the needs that the software intends to meet and ensures that expectations are met. Errors at this stage can be very costly to correct if detected after the software is completed.
It is best practice for errors to be corrected during the feasibility stage. The next best phase to correct debug for errors and do major overhauls is during the design phase.
Cheers
The following information relates to a product produced by Faulkland Company: Direct materials $ 10 Direct labor 7 Variable overhead 6 Fixed overhead 8 Unit cost $ 31 Fixed selling costs are $1,000,000 per year. Variable selling costs of $4 per unit sold are added to cover the transportation cost. Although production capacity is 500,000 units per year, Faulkland expects to produce only 400,000 units next year. The product normally sells for $40 each. A customer has offered to buy 60,000 units for $30 each. The customer will pay the transportation company directly for the transportation charges on the units purchased. If Faulkland accepts the special order, the effect on operating profits would be a:
Answer:
$180,000 Increase
Explanation:
The effect on operating profits can be determined by calculating the incremental income or loss arising from the special order.
Incremental analysis of accepting special order
Sales (60,000 × $30) $1,800,000
Less Variable Costs :
Direct materials ($ 10 × 60,000) ($600,000)
Direct labor ($ 7 × 60,000) ($420,000)
Variable overhead ($ 6 × 60,000) ($360,000)
Selling Costs ( $4 × 60,000) ($240,000)
Incremental Income/(loss) $180,000
Conclusion :
If Faulkland accepts the special order, operating income will increase by $180,000.
The economic concept of scarcity refers to the idea that : APEX
Answer: Resources required to fulfil our needs are insufficient
Explanation:
Scarcity in economics is the term used to describe the notion that the needs of a society are infinite but the resources needed to satisfy these needs are finite.
This is why humans have to constantly make a trade-off between resources needed to satisfy a need by picking one alternative course of action that requires a resource over another.
Answer:
People have limited resources to fulfill their unlimited wants.
Explanation:
Bronny gonna get the lebelt
All against Common Sense. Back in mid 80s, the US economy was very bad. It was much worse than it is now. At that time, to the surprise of many people, US automakers raised the prices of their cars. The common sense says that when the sales are slow, we lower prices and offer better deals to customers. Why do you think that the US car manufacturers increase the prices?
Answer:
Explanation:
This most likely happened because in the 80's the economy was so bad that even by lowering their prices the middle-class families would still not be able to afford to buy a car. The only individuals able to afford a car would be those who are wealthy. Therefore, by increasing prices and targetting wealthy individuals, the US car manufacturers could become profitable with much fewer sales and prevent the manufacturing plant from going under. Since wealthy individuals would not mind much the increased prices because they can still afford it without making much of a dent in their wealth.
Discuss the following statement: "Real GDP has decreased for two quarters in a row; we definitely are living through a contraction."
a. The statement is correct since this measurement standard has beenmandated by the U.S. Congress.
b. The statement is correct since two consecutive quarters is more than enoughtime to determine aneconomy's trend.
c. The statement is correct because changes in real GDP precisely mirrorchanges in other variables that reflect overall economic activity.
d. The statement is incorrect since the official arbiter of business cycledates (the NBER) looks at multiple indicators of economic activity beforedeclaring the onset of a contraction
Answer:
d
Explanation:
because it is declined i think
In their op ed, the executives sought to provide information to the public and drivers about their positions regarding providing benefits to drivers, showing the desire to increase ________ justice. By relying on a respected source of information (Barclays), the executives appeared to use the rule of ________. Multiple Choice interpersonal; procedure informational; truthfulness procedural; truthfulness informational; procedure interpersonal; informational
Answer:
d. Informational; Procedure
Explanation:
In their Op Ed, the executives sought to provide information to the public and drivers about their positions regarding providing benefits to drivers, showing the desire to increase Informational justice. By relying on a respected source of information (Barclays), the executives appeared to use the rule of Procedure. This is an example of informational justice where the rule of truthfulness is used.
Wyle Co. has $3.9 million of debt, $1 million of preferred stock, and $2.1 million of common equity. What would be its weight on preferred stock
Answer:
Weight of Preferred stock = 0.1428571429 or 14.28571429% rounded off to 14.29%
Explanation:
The capital structure of a business is made up of at least one or at most all of the following components namely Debt, Preferred Stock and Common Equity. The ratio in which each of these components form the capital structure might differ from business to business. The weightage of each component in the capital structure can be calculated by dividing the market value of each component by the sum of the market value of all the components.
Weight of a component = Market Value of component / Sum of market value of all components
Weight of Preferred stock = 1,000,000 / (3,900,000 + 1,000,000 + 2,100,000)
Weight of Preferred stock = 0.1428571429 or 14.28571429% rounded off to 14.29%
Lightfoot Company sells its product for $55 per unit and has variable costs of $30 per unit. Total fixed costs are $25,000. Suppose variable costs increase by 10% due to an increase in the cost of direct materials. What will be the effect on the breakeven point in units if variable costs increase by $5 due to an increase in the cost of directmaterials?
A. It will increase by 250 units.
B. It will decrease by 167 units.
C. It will decrease by 250 units.
D. It will increase by 167 units.
Answer:
The Break-even point in units will increase by 250 units.
Explanation:
Giving the following information:
Fixed costs= $25,000
Selling price= $55
Unitary varaible cost= $30
First, we need to calculate the current break-even point in units:
Break-even point in units= fixed costs/ contribution margin per unit
Break-even point in units= 25,000 / 25
Break-even point in units= 1,000
Now, the new Break-even point in units:
Break-even point in units= 25,000 / (55 - 35)
Break-even point in units= 1,250
The Break-even point in units will increase by 250 units.
A landlord needs to update a rental house due to it's age, so it can be habitable again. If he has that ability to cover a $1,500.00 payment monthly for 3 years at 5% compounded monthly, how much can he borrow and still be able to afford the payment?
Answer:
$50,048.55
Explanation:
Use the Time Value of Money Techniques to Find the Principle (PV), that is the amount to be borrowed under the conditions given.
Pmt = - $1,500.00
N = 3 × 12 = 36
i = 5%
P/yr = 12
Fv = $0
Pv = ?
Using a Financial calculator to enter the amount as done above the Principle amount would be $50,048.55
Heels, a shoe manufacturer, is evaluating the costs and benefits of new equipment that would custom fit each pair of athletic shoes. The customer would have his or her foot scanned by digital computer equipment; this information would be used to cut the raw materials to provide the customer a perfect fit. The new equipment costs $107,000 and is expected to generate an additional $43,000 in cash flows for five years. A bank will make a $107,000 loan to the company at a 15% interest rate for this equipment’s purchase. Compute the recovery time for both the payback period and break-even time. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.)
Chart Values are Based on:
10%
Cumulative Cash Inflow Present Value of Inflow Year Present Value PV Factor (Outflow) (Outflow)
(91,000) x 1.0000- (91,000) $ (91,000) 36,000 x 36,000 x 2.5 years
Answer:
Payback period = 2.49 years
Break-even time = 3.36 years
Explanation:
a. Calculation of payback period
The payback period can be described as the amount of time it will take a firm recover its cost on a project or an investment.
The payback period can be calculated as follows:
Equipment cost = $107,000
Annual cash flow = $43,000
Payback period = Equipment cost / Annual cash flow = $107,000 / $43,000 = 2.49 years
b. Calculation of break-even time
Note: See the attached excel file for the computation of the cumulative present value of inflow (outflow).
In the attached excel, the present value (PV) factor is calculated using the following formula:
PV factor = 1/(1 + r)^n ............................... (1)
Where;
r = interest rate = 15%
n = a particular year from 1 to 5.
Break even time can be described as the amount of time that is needed for both the discounted cash flows and the initial cost of a project to be equal.
The break-even time is calculated using the following formula:
Break-even time = X + (Y / Z) .................... (2)
X = Last year with a negative cumulative cash flow = 3
Y = Absolute value of cumulative cash flow at the end of period X = $8,821.32
Z = Present value of cash inflow for the period following X = $24,585.39
Break-even time = 3 + ($8,821.32 / $24,585.39) = 3 + 0.36 = 3.36 years
Which of following is true regarding text messaging? They represent a secure mode of communication that cannot be intercepted. Instant messaging is not dependent on the availability of Internet or computers. They represent the best means to communicate long messages that must be archived. The guidelines for business use of texting are still evolving. Text messaging is transmitted primarily via computers.
Answer:
The guidelines for business use of texting are still evolving and they reapresent a secure mode of communication that cannot be intercepted are true regarding text messaging.
Question 3
A situation where the level of output scale and average costs are all rising is called
Answer: Decreasing return to scale
Explanation:
Decreasing return to scale is a situation where the level of output, scale and average costs are all rising.
Decreasing return to scale happens when there's a rise in inputs that are involved in production process such as labour and capital which brings about a increase in output as well even though it's lesser.
On October 1, 2020, Jackson Chemical was identified as a potentially responsible party by the Environmental Protection Agency. Jackson's management along with its counsel have concluded that it is probable that Jackson will be responsible for damages, and a reasonable estimate of these damages is $5,000,000. Jackson's insurance policy of $9,000,000 has a deductible clause of $500,000. How should Jackson Chemical report this information in its financial statements at December 31, 2020
Answer:
Jackson Chemical should report the $5,000,000 loss because we don't know if the insurance will actually pay out the policy.
Explanation:
Jackson chemical has to report $500,000 loss associated with the deductible would be accrued as liability in the company's financial statements at Dec 31, 2020 since it is probably that Jackson will be responsible for the damages.
$500,000 is the amount of the insurance policy's deductible Jackson will have to pay to receive the policy's benefits, which will cover the reasonably estimated damages.
5. The Market Place recently offered 5,000 shares of stock for sale via a Dutch auction. The firm received bids as follows: 500 shares at $22.50; 2,500 shares at $22.20; 3,300 shares at $22; and 5,500 shares at $21. Ignoring all costs, how much will the firm receive from this auction
Answer:
$110,000
Explanation:
No of Shares Price Total number of shares
500 22.50 500
2500 22.20 3000
3300 22.00 6800
5500 21.00 12300
In Dutch auction, share are allotted from highest no. of share to lowest at the price where all the shares are taken. So in this case, highest number of shares are asked by Bidder D which is 5500 shares (available 5000 shares). The bidder will be getting shares at $22 because this is the price when all the shares were taken.
Hence, the amount the firm will receive from this auction = 5,000 *22 = $110,000
Assume Brad has a choice between two deposit accounts. Account WH has an annual percentage rate of 7.35% with interest compounded continuously. Account MW has an annual percentage rate of 7.45% with interest compounded monthly. Which account provides the highest effective annual return?
Answer: Account MW which compounds monthly provides a higher effective rate at 7.71%
Explanation:
Use the Effective Interest rate formula to see which offers the higher return.
Account WH;
Compounded continuously;
= e^(interest rate) - 1
= e^7.35% - 1
= 7.63%
Account MW
Compounded per month
= (( 1 + interest / compounding period) ^ period) - 1
= (( 1 + 7.45%/12) ^ 12) -1
= 7.71%
A company incurred the following costs associated with the purchase of a piece of land that it will use to re-build an office building: Purchase price of the land $ 620,000 Sale of salvaged parts already on land $ 25,000 Demolition of the old building $ 23,000 Ground-breaking ceremony (food and supplies) $ 1,100 Land preparation and leveling $ 8,300 What amount should be recorded for the purchase of the land
Answer:
$651,300
Explanation:
Cost of an item of property, plant and equipment comprises of purchase price and any cost directly attributable to bringing the asset to the location and condition for operation as intended by management.
Calculation of the cost of purchase of the land:
Purchase price $ 620,000
Demolition of the old building $ 23,000
Land preparation and leveling $ 8,300
Cost of purchase of the land $651,300
Linden, Inc. uses a 5,700 square foot factory space that it rents for $2,800 a month for all its manufacturing activities. Linden has decided to switch to an activity-based costing system, and has identified its activities as follows: Preparation and Setup, Machining, Finishing, and Quality Control. 2,600 square feet of the factory are used for machining, while 1,300 square feet (each) are used for Preparation and Setup and Quality Control. Finishing uses 500 square feet. When assigning indirect costs to each activity, how much factory rent should be assigned to the Preparation and Setup cost pool
Answer:
$639
Explanation:
Rent assigned to preparation and setup = Total rent / Total space * Space used by preparation and setup
= $2,800 / 5,700 * 1,300
= 638.5965
= $639
Therefore, the factory rent that would be assigned to Preparation and Setup cost pool is $639.
Juan owned 400 shares of Circle Corporation stock (adjusted basis of $102,000). He sold 200 shares for $40,800. Twenty days later he purchased 200 shares of the same stock for $30,600.
Required:
a. What is Juan's realized and recognized loss?
b. What is his basis in the newly acquired shares?
Answer:
a. -$10,200
b. $40,800
Explanation:
The computation of realized loss is shown below:-
Realized loss = Sales price - Adjusted basis
= $40,800 - ($102,000 × 200 ÷ 400)
= $40,800 - $51,000
= -$10,200
b. The computation of newly acquired shares is shown below:-
Basis for new acquired stock = Purchase price + Disallowed loss
= $30,600 + $10,200
= $40,800
We simply applied the above formula
You have just found your dream home. The selling price is $120,000. You will put $20,000 down and obtain a 30-year fixed-rate mortgage at 7.25% compounded monthly for the rest. Suppose that in addition to the required monthly payment, you decide to make an additional principal payment along with your regular payment. How much extra must you pay each month (rounded to the nearest dollar) if you wish to pay off the loan in 20 years
Answer:
$108
Explanation:
The computation is shown below:
Given that
PV = 100,000, ($120,000 - $20,000)
FV = 0,
N = 360 (30 × 12 months)
rate = 7.25%/12
Now use PMT function in Excel
= PMT(RATE,NPER,-PV,FV,TYPE)
The present value comes in negative
After applying the above formula
The monthly payments is 682
Now replace N with 240 (20 years × 12 months)
So,
monthly payment = 790
Therefore
The difference is
= $790 - $682
= $108
What is a bushiness opportunity?
Answer: You said it yourself, an opportunity.
Explanation:
A business opportunity is often used to describe a way for a business to make more money. It can also mean many other things such as hiring more employees, creating more roles, partnering with another company, etcetera.
But mainly used to make more money.Troy, a cash basis taxpayer, owns an office building. His records reflect the following for 20X1. On March 1, 20X1, office B was leased for twelve months for $12,000. A $900 security deposit was received which will be used as the last month's rent. On September 30, 20X1, the tenant in office A paid Troy $3,600 to cancel the lease expiring on March 31, 20X1. The lease of the tenant in office C expired on December 31, 20X1, and the tenant left improvements valued at $1,400. The improvements were not in lieu of any required rent. Considering just these four amounts, what amount must Troy include in rental income on his income tax return for 20X1?
a. $17,900
b. $17,000
c. $16,500
d. $13,800
Answer:
c. $16,500
Explanation:
The rental revenue from office B must be included even though 3 months of rent belong to 20x2 = $12,000 + the $900 security deposit (last moth of rent). The $3,600 received for canceling the lease of office A should also be included. Total rental income = $12,000 + $900 + $3,600 = $16,500.
Cash basis taxpayers recognize revenue when they collect money, and recognize expenses when they pay for them. There are some exceptions that apply to prepaid expenses or unearned revenue. This is known as the 12 month rule. It means that if the cash collection or payment do not extend for more than 12 months after they were made, then they can be recorded as either revenues or expenses during the current period. Since the rent was prepaid in advance for 12 months, then all the cash received must be considered revenue.
None of the following would be an advantage of self-administered surveys:
A) Reduced cost
B) Respondent control
C) Reduced interview evaluation apprehension
A. True
B. False
Answer:
B. False
Explanation:
A self-administered survey is one where there is the collection of the necessary data for the survey is carried out through a questionnaire of questions to be answered by the interviewee. Questionnaires can be sent via mail, e-mail, personal interception, hand delivery etc.
The advantages of self-administered surveys are cost reduction, since questionnaires can be sent via email at no cost to both, greater control of the interviewee, since the questions can be developed according to the information you want to collect, greater quick feedback, which reduces the apprehension of the interview evaluation.
False, the self-administered surveys would not be advantageous in terms of reduced interview evaluation apprehension. The Option B.
Would self-administered surveys be advantageous?Self-administered surveys eliminate the need for face-to-face interactions and direct interviewer involvement which can indeed reduce interview evaluation apprehension. When individuals complete surveys on their own, they may feel less pressured and more comfortable expressing their opinions.
But this advantage does not hold true for self-administered surveys as they are completed by the respondents themselves without the presence of an interviewer. Consequently, the absence of an interviewer does not contribute to a reduction in interview evaluation apprehension. Therefore, the Option B is correct.
Read more about surveys
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Arntson, Inc., manufactures and sells two products: Product R3 and Product N0. The annual production and sales of Product of R3 is 1,100 units and of Product N0 is 200 units. Data concerning the expected production of each product and the expected total direct labor-hours (DLHs) required to produce that output appear below: Expected Production Direct Labor-Hours Per Unit Total Direct Labor-Hours Product R3 1,100 8.0 8,800 Product N0 200 4.0 800 Total direct labor-hours 9,600 The direct labor rate is $24.10 per DLH. The direct materials cost per unit is $285.00 for Product R3 and $235.00 for Product N0. The company is considering adopting an activity-based costing system with the following activity cost pools, activity measures, and expected activity: Estimated Expected Activity Activity Cost Pools Activity Measures Overhead Cost Product R3 Product N0 Total Labor-related DLHs $ 41,536 8,800 800 9,600 Production orders orders 56,010 1,200 200 1,400 Order size MHs 433,975 3,500 2,700 6,200 $ 531,521 The unit product cost of Product R3 under activity-based costing is closest to: (Round your intermediate calculations to 2 decimal places.) rev: 03_25_2018_QC_CS-119201 Multiple Choice $778.81 per unit $1,063.81 per unit $586.01 per unit $301.01 per unit
Answer:
Arntson, Inc.
The unit product cost of Product R3 under activity-based costing is closest to:
$778.81 per unit
Explanation:
a) Data and Calculations:
Annual production and sales:
Product R3 Product N0
Units 1,100 200
Direct Labor-Hours 1,100 200
Per Unit Total 8.0 4.0
Direct Labor-Hours 8,800 800
Total direct labor-hours 9,600
Direct labor rate is $24.10 per DLH.
Direct materials cost $285.00 $235.00
Estimated Expected Activity Cost Activity Measures Overhead Cost
Activity Pools
Overhead Cost Product R3 Product N0 Total
Labor-related DLHs $ 41,536 8,800 800 9,600
Production orders orders 56,010 1,200 200 1,400
Order size MHs 433,975 3,500 2,700 6,200
Total overhead costs $ 531,521
Activity rates: Product R3 Product N0
Labor-related DLHs $4.33 ($41,536/9,600) $38,104 $3,464
Production orders $40.00 ($56,010/1,400) 48,000 8,000
Order size MHs $70.00 ($433,975/6,200) 245,000 189,000
Total allocated overhead costs $331,104 $200,464
Product R3 Product N0
Units 1,100 200
Direct materials cost $285.00 $235.00 per unit
Total materials costs = $313,500 $47,000
Total direct labor costs 212,080 19,280
Total overhead costs 331,104 200,464
Total production costs $856,684 $266,744
Unit cost = $778.80 $1,333.72
Assume that demand for gasoline is inelastic and supply is relatively elastic. The government imposes a sales tax on gasoline. The tax revenue is used to fund research into clean fuel alternatives to gasoline, which will improve the air we all breathe. Who bears more of the burden of this tax, consumers or producers
Answer:
The burden is borne mostly by consumers
Explanation:
A Tax is said to be a compulsory or a Mandatory payment to local, state, or national government while Revenueis said to be the income of government derived or gotten from tax and non tax sources
Sales tax is termed a type of tax that is usually based on the cost of the item purchased and collected directly from the buyer. It is also said to be fee charged upon by the total cost of things you buy. It is collected by the seller and added onto the price. It's is due to a percent set by the government. consumers bore the tax payment mostly.
Reporting Net Sales after Sales Discounts and Sales Returns [LO 6-4]
The following transactions were selected from among those completed by Bear’s Retail Store:
Nov. 20 Sold two items of merchandise to Cheryl Jahn, who paid the $400 (total)
sales price in cash. The goods cost Bear’s $300.
25 Sold 20 items of merchandise to Vasko Athletics at a selling price of
$4,000 (total); terms 3/10, n/30. The goods cost Bear’s $2,500.
28 Sold 10 identical items of merchandise to Nancy’s Gym at a selling price
of $6,000 (total); terms 3/10, n/30. The goods cost Bear’s $4,000.
29 Nancy’s Gym returned one of the items purchased on the 28th. The item
was in perfect condition and credit was given to the customer.
Dec. 6 Nancy’s Gym paid the account balance in full.
30 Vasko Athletics paid in full for the invoice of November 25.
Required:
Compute the net sales revenue to be reported over the two months.
Answer:
$9,638
Explanation:
Computation for the net sales revenue to be reported over the two months.
Net Sales
Date Particulars Amount
Nov. 20 Sales $ 400
Nov. 25 Sales $ 4,000
Nov. 28 Sales $ 6,000
Nov. 29 Sales Returns $ (600)
(1/10 units *6,000)
Dec. 6 Sales Discount $ (162) [(6,000-600)*3/100]
Net sales $ 9,638
Therefore the net sales revenue to be reported over the two months will be $9,638
Answer:
$9,638
Explanation:
Computation for the net sales revenue to be reported over the two months.
Explanation:
A manager must make a decision on shipping. There are two shippers: A and B. Both offer a two-day rate: A for $536, and B for $525. In addition, A offers a three-day rate of $464 and a nine-day rate of $416, and B offers a four-day rate of $459 and a seven-day rate of $436. Annual holding costs are 37 percent of unit price. Three hundred and ninety boxes are to be shipped, and each box has a price of $154. Which shipping alternative would you recommend?
Answer: I would recommend shipper A three days option as that is the cheapest option with $604.499
Explanation:
Given data
Boxes to be shipped = 300
Cost/Box = $154
Annual holding cost = 37%.
Solution:
Total cost of boxes
= $154 * 300
= $46,200
Holding cost
= 0.37 * $46,200
= $17,094.
Daily holding cost
= $17,094/365
= $46.833.
Shipper A
Two days rate = $536
= $536 + 2 ( 46.833 )
= $629.266
Three days rate = $464
= $464 + 3(46.833)
= $604.499
Nine days rate = $416
= $416 + 9(46.833)
= $835.697
Shipper B
Two days rate = $525
= $525 + 2(46.833)
= $616.67
Four days rate = $459
= $459 + 4(46.833)
= $646.332
Seven days rate = $436
= $436 + 7(46.833)
= $763.831
I would recommend shipper A three days option as that is the cheapest option with $604.499
Warbler Gift's reported the following information for the sales of their single product: Total Per Unit Sales $ 300,000 $ 10 Variable expenses 180,000 6 Contribution margin 120,000 $ 4 Fixed expenses 100,000 Net operating income $ 20,000 Warbler's salesmen have proposed to decrease the selling price by 50 cents per unit. How many units will need to be sold for Warbler to earn at least the same net operating income
Answer: Requitred units =34,285.7 units
Explanation:
GIVEN
Total Per Unit Sales
$ 300,000 $ 10
Variable expenses 180,000 $6
Contribution margin 120,000 $ 4
Fixed expenses 100,000
Net operating income $ 20,000
New selling price=Old price - prosed price
=$10-$0.5 = $9.5
Revised contribution margin= Selling price-Variable costs
= $9.5-$6=$3.5
Proposed Contribution margin=Net operating income + Fixed expenses.
=(100,000 +20,000)= $120,000
Required units to be sold=Proposed Contribution margin/Contribution margin per unit
= $120,000/$3.5
=34,285.7 units
