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Blizzard [7]
2 years ago
6

Identify whether each of the following statements best illustrates the concept of consumer surplus, producer surplus, or neither

.
Producer Surplus Consumer Surplus Neither Statement
a. Even though I was willing to pay up to $40 for a jersey sweater,
b. I bought a jersey sweater for only $31 I sold a used laptop for $137, even though
c. I was willing to go as low as $130 in order to sell it A local store was having a sale on watches, so I bought a watch for my brother.
Business
1 answer:
DiKsa [7]2 years ago
6 0

Answer:

a. Even though I was willing to pay up to $40 for a jersey sweater, I bought a jersey sweater for only $31.

Consumer Surplus;

= 40 - 31

= $9

When the amount that a consumer is willing to pay for something is more than the amount they actually pay, the difference is the Consumer surplus.

b. I sold a used laptop for $137, even though I was willing to go as low as $130 in order to sell it.

Producer Surplus

= 137 - 130

= $7

When the amount that a producer is willing to sell something for is less than the amount they actually sell it for, the difference is the Producer surplus.

c. I was willing to go as low as $130 in order to sell it A local store was having a sale on watches, so I bought a watch for my brother. Neither.

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Beto Company pays $4.70 per unit to buy a part for one of the products it manufactures. With excess capacity, the company is con
Anastasy [175]

Here, we are decide the best option between making the part or buying the part.

a.                  Make or Buy Analysis

Particulars                              Make amount    Buy amount

Direct Materials                            $4.50

Direct Labor                                $1.00  

Overhead (80% of Direct Labor)    $0.80  

Cost to buy                            <u>              </u>            <u>$4.70</u>

Cost per unit                              <u>$5.70    </u>          <u>$4.70</u>

Cost Difference = $5.70 - $4.70

Cost Difference = $1.00

Therefore, the cost difference of making amount over buying amount is $1.00.

b. Because of the difference, Beto should buy the part because its cost is lesser than to make the part.

Therefore, the buying of the part is the best decision.

See similar solution about Analysis

<em>brainly.com/question/23287319</em>

3 0
2 years ago
Sawaya Co., Ltd, of Japan, is a manufacturing company whose total factory overhead costs fluctuate considerably from year to yea
coldgirl [10]

Answer:

Explanation:

1. Indirect Material variable cost Per Direct Labor HR 5000000/50000=100

Indirect Material (variable) 100*75000 =7500000

Rent Fixed 6000000

Hence total Maintenace Fixed =17625000-7500000-600000= 4125000

2.

                   Low            High      Change

Cost 3250000 4125000 875000 [4125000-3250000]

Activities 50000          75000   25000

variable Portion of Maitencance cost =875000/25000= 35.00

Fixed cost=4125000-75000*35=1500000

Variable cost=35

cost formula for maintenance= 1500000+35b

3.

Indirect Material (variable) 100*70000 = 7000000

Rent Fixed                      6000000

Maintenance cost = 1500000+35*70000=3950000

5 0
2 years ago
An inventory error not only affects the current year's cost of goods sold, gross profit, net income, current assets and equity,
pychu [463]

The correct answer is "ending inventory of one period is the beginning inventory of the next period."

An inventory error not only affects the current year's cost of goods sold, gross profit, net income, current assets, and equity, but also the next period's statements because ending inventory of one period is the beginning inventory of the next period.

That is why the manager has to be strict regarding the inventory of a company. Inventory has a cost that can be translated into money. So accountants have to be perfect regarding the inventory. So yes, ann error in keeping the inventory affects the company in that the ending inventory of one period is the beginning inventory of the next period. An internal audit can reveal the mistakes in accurately keeping the inventory. So it is better to put extra attention in the process so nothing wrong would be revealed after the audit.

7 0
3 years ago
A firm’s management analyzes financial statement’s so that: a. they can get feedback on their investing, financing, and working
Zepler [3.9K]

Answer:

d. a and b

Explanation:

A firm’s management analyzes financial statement’s so that:

Evaluating company's performance, by analyzing the financial statements in respect of various areas of financing, investing and operating activities, and then comparing the performance with past records and industries of same category.

Further the firm's management is responsible to take decision of dividend, and return to be paid to equity and various other stakeholders, thus both options a and b are correct.

Correct answer

d. a and b

7 0
2 years ago
With negotiated transfer pricing, what is the minimum transfer price if operating at capacity? What is the minimum transfer pric
dezoksy [38]

Answer:

Minimum transfer price when operating at capacity is the marginal cost + opportunity cost

Maximum transfer price is marginal cost only, when not operating at capacity.

Explanation:

Minimum transfer price when operating at capacity is the marginal cost + opportunity cost because when operating at capacity there are 2 elements involved - the cost at which it has made the units it will be transferring to another department within the organisation, and the profit it would have made if it had sold those units to others (opportunity cost)

Maximum transfer price is marginal cost only, when not operating at capacity because the department is constrained, it can only produce for the satisfaction of internal demand, not external customers; hence there is no case of opportunity costs.

8 0
2 years ago
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