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Marina86 [1]
4 years ago
12

Moonbeam Company manufactures toasters. For the first 8 months of 2017, the company reported the following operating results whi

le operating at 75% of plant capacity: Sales (350,000 units) $4,375,000 Cost of goods sold 2,600,000 Gross profit 1,775,000 Operating expenses 840,000 Net income $935,000 Cost of goods sold was 70% variable and 30% fixed; operating expenses were 80% variable and 20% fixed. In September, Moonbeam receives a special order for 15,000 toasters at $7.60 each from Luna Company of Ciudad Juarez. Acceptance of the order would result in an additional $3,000 of shipping costs but no increase in fixed costs. (a) Prepare an incremental analysis for the special order. (Round computations for per unit cost to 4 decimal places, e.g. 15.2500 and all other computations and final answers to the nearest whole dollar, e.g. 5,725. If amount decreases net income then enter the amount using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Reject Order Accept Order Net Income Increase (Decrease) Revenues $ $ $ Cost of goods sold Operating expenses Net income $ $ $ (b) Should Moonbeam accept the special order
Business
1 answer:
iVinArrow [24]4 years ago
6 0

Answer:

The order should be accepted as it will icnrease contribution by 2,700 dollars

Sales revenue            112,500

variable cost             (106,800)

additional fixed cost  <u>  (3,000)</u>

contribution                  2,700

Explanation:

We have to calculate the variable cost to compare against the offer sales price:

COGS

2,600,000 x 70% =   1,820,000

Operating expense

840,000 x 80% =          672,000

total variable               2,492,000

variable per unit:  

2,492,000   /    350,000  = 7.12

we now calculate the contribution of the order and subtract the additional cost:

15,000 units x (7.50 - 7.12) -3,000 additional shipping

contribution 2,700

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The marginal product of labor in the production of computer chips is 3030 chips per hour. The marginal rate of technical substit
fredd [130]

Answer:

150

Explanation:

As we know that

The marginal rate of technical substitution ​(MRTS) = Marginal product of labor ÷ Marginal product of capital

where,

The marginal rate of technical substitution ​(MRTS) = 0.20

And, the marginal product of labor is 30 chips per hour

So, the marginal product of capital is

= 30 chips per hour ÷ 0.20

= 150

The marginal rate of technical substitution ​(MRTS​) shows a relationship between the marginal product of labor and the marginal product of capital

5 0
3 years ago
. What do you understand by term “advertising”. What would happen if ethical advertisement is not followed by businesses? Explai
Blababa [14]

Answer:

Ethics means a set of moral principles which govern a person’s behavior or how the activity is conducted. And advertising means a mode of communication between a seller and a buyer.

Thus ethics in advertising means a set of well defined principles which govern the ways of communication taking place between the seller and the buyer. Ethics is the most important feature of the advertising industry. Though there are many benefits of advertising but then there are some points which don’t match the ethical norms of advertising.

An ethical ad is the one which doesn’t lie, doesn’t make fake or false claims and is in the limit of decency.

Nowadays, ads are more exaggerated and a lot of puffing is used. It seems like the advertisers lack knowledge of ethical norms and principles. They just don’t understand and are unable to decide what is correct and what is wrong.

The main area of interest for advertisers is to increase their sales, gain more and more customers, and increase the demand for the product by presenting a well decorated, puffed and colorful ad. They claim that their product is the best, having unique qualities than the competitors, more cost effective, and more beneficial. But most of these ads are found to be false, misleading customers and unethical. The best example of these types of ads is the one which shows evening snacks for the kids, they use coloring and gluing to make the product look glossy and attractive to the consumers who are watching the ads on television and convince them to buy the product without giving a second thought.

<em>Ethics in Advertising is directly related to the purpose of advertising and the nature of advertising. Sometimes exaggerating the ad becomes necessary to prove the benefit of the product. For e.g. a sanitary napkin ad which shows that when the napkin was dropped in a river by some girls, the napkin soaked whole water of the river. Thus, the purpose of advertising was only to inform women about the product quality. Obviously, every woman knows that this cannot practically happen but the ad was accepted. This doesn’t show that the ad was unethical. </em>

Ethics also depends on what we believe. If the advertisers make the ads on the belief that the customers will understand, persuade them to think, and then act on their ads, then this will lead to positive results and the ad may not be called unethical. But at the same time, if advertisers believe that they can fool their customers by showing any impractical things like just clicking fingers will make your home or office fully furnished or just buying a lottery ticket will make you a millionaire, then this is not going to work out for them and will be called as unethical.

Recently, the Vetican issued an article which says ads should follow three moral principles - Truthfulness, Social Responsibility and Upholding Human Dignity.

Generally, big companies never lie as they have to prove their points to various ad regulating bodies. Truth is always said but not completely. Sometimes its better not to reveal the whole truth in the ad but at times truth has to be shown for betterment.

Pharmaceutical Advertising - they help creating awareness, but one catchy point here is that the advertisers show what the medicine can cure but never talk about the side effects of that same thing or the risks involved in intake of it.

Children - children are the major sellers of the ads and the product. They have the power to convince the buyers. But when advertisers are using children in their ad, they should remember not to show them alone doing there work on their own like brushing teeth, playing with toys, or infants holding their own milk bottles as everyone knows that no one will leave their kids unattended while doing all these activities. So showing parents also involved in all activities or things being advertised will be more logical.

Alcohol - till today, there hasn’t come any liquor ad which shows anyone drinking the original liquor. They use mineral water and sodas in their advertisements with their brand name. These types of ads are called surrogate ads. These type of ads are totally unethical when liquor ads are totally banned. Even if there are no advertisements for alcohol, people will continue drinking.

Cigarettes and Tobacco - these products should be never advertised as consumption of these things is directly and badly responsible for cancer and other severe health issues. These as are already banned in countries like India, Norway, Thailand, Finland and Singapore.

Ads for social causes - these types of ads are ethical and are accepted by the people. But ads like condoms and contraceptive pills should be limited, as these are sometimes unethical, and are more likely to loose morality and decency at places where there is no educational knowledge about all these products.

(that is same question on my papers)

7 0
3 years ago
Gomez Corp. uses the allowance method to account for uncollectibles. On January 31, it wrote off an $2,800 account of a customer
laila [671]

Explanation:

The Journal entry is shown below:-

On Jan 31

Allowance for doubtful accounts $2,800

                     To Accounts receivable - C. Green $2,800

(Being the uncollectible amount is recorded)

Mar 09

Accounts receivable - C. Green $2,300

               To  Allowance for doubtful accounts $2,300

(Being the written off amount is recorded

Mar 09

Cash $2,300

              To Accounts receivable -  C. Green $2,300

(Being the payment is received is recorded)

7 0
3 years ago
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A newly created design​ business, Teri's​ Art, is finishing its first year of operations. During the​ year, credit sales were $4
Vikentia [17]

Answer:

the bad debt expense is $900

Explanation:

The computation of the bad debt expense is shown below:

bad debt expense is

= Written off amount + estimated uncollectible amount at the year end

= $650 + $250

= $900

We simply added the above two items so that the amount of the bad debts for the first year could come

Hence, the bad debt expense is $900

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3 years ago
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