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Anna35 [415]
3 years ago
10

Suppose a farmer in Georgia begins to grow peaches. He uses​ $1,000,000 in savings to purchase​ land, he rents equipment for ​$7

0 comma 00070,000 a​ year, and he pays workers ​$120 comma 000120,000 in wages. In​ return, he produces 250 comma 000250,000 baskets of peaches per​ year, which sell for ​$3.003.00 each. Suppose the interest rate on savings is 22 percent and that the farmer could otherwise have earned ​$40 comma 00040,000 as a shoe salesman. What is the​ farmer's economic​ profit?
Business
1 answer:
Mazyrski [523]3 years ago
8 0

Answer:

Economic profit = $300,000

Explanation:

<em>Economic profit is the difference between the sales revenue and the total of implicit cost and explicit cost</em>

Implicit cost are opportunity costs. For the farmer, these include

Interest on capital forfeited and salaries forfeited

= (22%×  1,000,000) + 40,000

= 260,000

Total cost = Implicit +explicit costs

=  260,000 + 260,000 +70,000 +120,000

 Economic profit =750000- (260,000 +70,000 +120,000)

                         = $300,000

Note that the cost of land is not included because it a capital cost

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Intuitive decision making uses ____ to make decisions
rusak2 [61]

Answer:

Judgment.

Explanation:

Intuitive decision making uses ____ to make decisions. Judgment.

3 0
2 years ago
Direct materials and direct labor of a company total $8300000. If manufacturing overhead is $4150000, what is direct labor cost
iragen [17]

Answer:

The direct labor cost cannot be ascertained from the information given in the question

Explanation:

Direct materials+Direct labor cost= $8300000

In order to determine the labor cost of the  $8300000, we need a clue as to the percentage of the labor cost in the total of  $8300000 or the portion of  $8300000 that belongs to direct materials.

Since such a hint is missing,we can simply guess, costs  incurred cannot be shared out on a basis that has no relationship with reality,hence, the correct answer is that the direct labor cost cannot be determined based on details provided.

5 0
3 years ago
Jane currently has $5,000 in her savings account and $2,000 in her checking account at the local bank. Instructions: Use a posit
diamong [38]

Answer:

Change in M1 $400

Changd in M2 $0

Explanation:

The money which is been held by individuals in savings accounts is part of the M2 money supply, but its not part ofthe M1 money supply.

Hence when Jane withdraws $400 cash from her savings account,the M1 money supply will increases by $400. However, the M2 money supply does not tend to change reason been that the M1 money supply is included as part of the M2 money

Change in M1 $400

Changd in M2 $0

7 0
3 years ago
Borques Company produces and sells wooden pallets that are used for moving and stacking materials. The operating costs for the p
KengaRu [80]

Answer:

Borques Company

a. Unit inventory cost = $7.27

b. Ending inventory = 3,900 units

c. Absorption-costing operating income = $73,569

Explanation:

a) Data and Calculations:

Variable costs per unit:

Direct materials      $2.85

Direct labor             $1.92

Variable overhead $1.60  $6.37

Variable selling     $0.90   $7.27

Fixed costs per year:

Fixed overhead                $180,000

Selling and administrative $96,000  $276,000

Selling price per unit = $9

Acceptable per-unit inventory cost:

Variable product cost per unit = $6.37

Total variable production cost = $1,274,000

Fixed production cost =                   180,000

Total production cost =              $1,453,000

Unit inventory cost = $7.27 ($1,453,000/200,000)

b. Ending inventory

Beginning inventory   8,200

Production units = 200,000

Units available       208,200

Sales units =          204,300

Ending inventory       3,900

c. Absorption Costing Operating Income:

Sales Revenue                 $1,838,700 ($9 * 204,300)

Cost of goods sold             1,485,261 ($7.27 * 204,300)

Gross profit                        $353,439

Selling expenses:

Variable ($0.90 * 204,300) 183,870

Fixed                                     96,000

Total selling expenses    $279,870

Operating income             $73,569

5 0
2 years ago
Paradise Corporation budgets on an annual basis for its fiscal year. The following beginning and ending inventory levels (in uni
Reika [66]

Answer:

485,000 units

Explanation:

The computation of the number of units manufactured is shown below:

= Number of units sold + ending finished goods units - beginning finished goods units

= 515,000 units + 87,000 units - 57,000 units

= 485,000 units

Basically we added the ending finished goods units and deduct the beginning finished goods units to the number of units sold                      

7 0
3 years ago
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