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3 years ago

A firm could continue to operate for years without ever earning a profit as long as it is producing an output where

Business

1 answer:

Assoli18 [71]3 years ago

5 0

A firm could continue to operate for years without ever earning a profit as long as it is producing an output where

B. MR >AVC

MR stands for marginal revenue which is the sale price of a single item sold. On the other hand, AVC or the average variable cost is the firm’s variable costs divided by its output that is produced.

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Marigold’s Pest Control Products has the following information available: net income, $15800; cash provided by operations, $2170

tester [92]

Answer:

The Maigold's free cash flow can be calculated using the below formula:

Cash Provided by Operations-Capital expenditure-Dividends paid

Explanation:

Cash provided by operations $21700

Capital expenditure ($10100)

Dividends paid ($3500)

Free cash flow of Maigold's $8100

8 0

3 years ago

The management of Heider Corporation is considering dropping product J14V. Data from the company's accounting system appear belo

zmey [24]

Answer:

Overall net operating income would decrease by $135,000

Explanation:

Calculation for What would be the effect on the company's overall net operating income if product J14V were dropped

Keep J14V Drop J14VDifference

Sales$980,000 $ 0 $(980,000)

Variable expenses

$394,000 $0 $394,000

Contribution margin

$586,000 $0 $(586,000)

Fixed expenses:

Fixed manufacturingexpenses

$376,000 $131,000 $245,000

($376,000-$245,000=$131,000)

Fixed selling and administrative expenses

$256,000 $50,000 $206,000

($256,000-$206,000=$50,000)

Net operating income(loss)

$(46,000) $(181,000) $(135,000)

Net operating income would decline by $135,000

Therefore the Overall net operating income would decrease by $135,000.

8 0

3 years ago

A company issues a ten-year bond at par with a coupon rate of 6.4% paid semi-annually. The YTM at the beginning of the third

sladkih [1.3K]

Answer:

$\mathbf{current \ price \ of \ the \ bond= \$848.78}$

Explanation:

The current price of the bond can be calculated by using the formula:

$current \ price \ of \ the \ bond= ( coupon \times \dfrac{ (1- \dfrac{1}{(1+YTM)^{no \ of \ period }})}{YTM} + \dfrac{Face \ Value }{(1+YTM ) ^{no \ of \ period}}$

$current \ price \ of \ the \ bond= ( \dfrac{0.064 \times \$1000}{2} \times \dfrac{ (1- \dfrac{1}{(1+ \dfrac{0.091}{2})^{8 \times 2}})}{\dfrac{0.091}{2}} + \dfrac{\$1000 }{(1+\dfrac{0.091}{2} ) ^{8 \times 2}})$