Answer:
(i) 900 CDs
(ii) Greater than; $1,650
Explanation:
(1) Break-event point will be when the contribution margin from total sales is equal to fixed costs,
Contribution Margin = Selling price - variable cost
= $(21.5 - 9.5)
= $12
Contribution Margin *Number of CDs sold = $10,800
Break-even point for Studio A = 10,800 ÷ 12
= 900 CDs
(2) Studio A would be more profitable when the extra profit earned from per unit sale of CD exceeds the extra fixed cost given in Studio A.
Extra Contribution margin in Studio A = $(12-10)
= $2
Extra Fixed cost in Studio A = $(10,800 - 7,500)
= $3,300
Studio A should be chosen if sales is greater than (3300/2) = $1,650.
Answer:
The correct answer is $79,000 and $37,000.
Explanation:
According to the scenario, the given data are as follows:
Net income = $116,000
Doug's Salary = $52,000
Receive an interest = 10%
So, the amount to be shared equally = [$116,000 - $52,000 - ( 10% × $220,000) - ( 10% × $320,000)] ÷ 2
= $5,000
So, Doug share = $52,000 + ( 10% × $220,000) + $5,000
= $79,000
Kayla share = (10% × $320,000) + $5,000 = $37,000
Answer:
best combination of resources to use to produce a product.
Explanation:
Capitalism also referred to as free-enterprise system or free market can be defined as a type of economy in which prices, products and services are being determined by the market rather than the government. Thus, capitalism is devoid (free) of government regulations, interference or control because the market (enterprises) are the ones who are saddled with the responsibility of determining the market forces.
Simply stated, a pure capitalism is a type of economy that is completely driven by demand and supply of goods and services.
In a society, the role of an entrepreneur is mainly focused on bringing the four (4) factors of production together and take the risks of producing output, so as to generate revenue through sales and make economic profits in the long-run.
Hence, the profit and loss system of capitalism helps entrepreneurs determine best combination of resources to use to produce a product.
Answer: $32000
Explanation:
The required reserves will be calculated as:
= Checkable deposit × Legal reserve ratio
= $80000 × 20%
= $16000
Excess reserves = $16000
Actual reserves will now be:
= Required reserves + Excess reserves
= $16,000 + $16,000
= $32,000
