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Viktor [21]
3 years ago
7

A company has three products possible products that it can produce in a machine intensive production process. Capacity is constr

ained by the number of hours the machines can run during a period and the products are so popular that all units produced will be sold. Here is additional information:
​ Product A Product B Product C
Contribution per unit $20 $30 $40
Machine hours per unit 2.5 3.25 4.5
Which of the following would be an accurate conclusion based on these facts?

A. Since Product C has the greatest contribution margin per unit and therefore emphasizing its production and sales will lead to the highest operating income in the short-run

B. Since A takes less time to produce, maximization of operating income will occur by emphasizing production and sales of A.

C. A balanced mix of 1/3 A, 1/3 B, and 1/3 C should be the goal when maximizing operating income in the short-run.

D. Product B should be emphasized if the goal is to maximize contribution margin.
Business
1 answer:
disa [49]3 years ago
3 0

Answer:

D

Explanation:

                                          A             B             C

Contribution per unit      20          30           40

Machine hours per unit  2.5          3.25       4.5

Contribution per hour     8             9.23       8.89

Product B has the highest contribution per hour .

It is stated that the capacity is constrained by the number of hours the machine can run during a period . and all products produce will be sold. This has made the machine hour the determinant factor in the situation.

Therefore product B should be emphasized if the goal is to maximize contribution margin.

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muminat

Answer

The answer and procedures of the exercise are attached in the following archives.

Step-by-step explanation:

You will find the procedures, formulas or necessary explanations in the archive attached below. If you have any question ask and I will aclare your doubts kindly.  

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4 0
3 years ago
How does the effectiveness of the team members influence the group's development process?
igomit [66]
Team effectiveness can be judged by measuring the gainful yield of the group. On the off chance that a person on the group is not investing the exertion the improvement procedure can be longer. A gathering turns into a group when the accompanying criteria are met: Leadership turns into a common movement, Accountability shifts from entirely individual to both individual and group, The gathering builds up its own motivation or mission, Problem-fathoming turns into a lifestyle, not low maintenance action, Effectiveness is measured by the gathering's aggregate results and items. In light of contentions because of force, expert, and temperamental interpersonal connections, many works gathers never qualify as a genuine group.
5 0
3 years ago
Park Co. is considering an investment that requires immediate payment of $27,000 and provides expected cash inflows of $9,000 an
Reil [10]

Answer:

IRR =   12.92%

Explanation:

<em>The IRR is the discount rate that equates the present value of cash inflows to that of cash outflows. At the IRR, the Net Present Value (NPV) of a project is equal to zero </em>

<em>If the IRR greater than the required rate of return , we accept the project for implementation  </em>

<em>If the IRR is less than that the required rate , we reject the project for implementation  </em>

A project that provides annual cash flows of $24,000 for 9 years costs $110,000 today. Under the IRR decision rule, is this a good project if the required return is 8 percent?

Lets Calculate the IRR

<em>Step 1: Use the given discount rate of 10% and work out the NPV </em>

NPV = 9000× (1-1.10^(-4)/0.1) - 27,000 =1528.78

<em>Step 2 : Use discount rate of 20% and work out the NPV (20% is a trial figure) </em>

NPV = 9000× 1- 1.20^(-4)/0.2 - 27000 = -3701.38

<em>Step 3: calculate IRR </em>

<em>IRR = a% + ( NPVa/(NPVa + NPVb)× (b-a)%</em>

IRR = 10% +  1528.78/(1528.78+3701.38)× (20-10)%= 0.12923

     = 0.129230153  × 100

IRR =   12.92%

3 0
3 years ago
On April 1, 2021, Austere Corporation issued $320,000 of 15% bonds at 106. Each $1,000 bond was sold with 40 detachable stock wa
drek231 [11]

Answer:

$300,800

Explanation:

First Calculate  the proceeds from the issuance of the bond

Proceeds from bonds = Face value x Price rate = $320,000 x 106% = $339,200

Now calculate the fair value of the warrant issued

Fair value of warrant = Numbers of shares x Stock per bond x Market value of each Warrant = ( $320,000 / $1,000 ) x 40 x $3 = 320 x 40 x $3 = $38,400

Liability Portion = Procedds from bonds - Fair value of waarants = $339,200 - $38,400 = $300,800

6 0
2 years ago
Andy Hiking produces backpacks. In the previous year, its highest and lowest production levels occurred in July and January, res
8_murik_8 [283]

Answer:

Variable cost= $73.50

Explanation:

The high low method is used to get the fixed and variable cost of a business activity given limited data. It involves taking the highest and lowest points, then comparing the total cost at these points.

We use the following formula

Variable cost= (Highest activity cost - Lowest activity cost)/ (Highest activity unit - Lowest activity unit)

Variable cost= (207,250- 97,000)/ (5,900-4,400)

Variable cost= 110,250/ 1,500

Variable cost= $73.50

6 0
3 years ago
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