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Ede4ka [16]
3 years ago
13

Adler Company is considering developing a new product. The company has gathered the following information on this product. Expec

ted total unit cost $25 Estimated investment for new product $500,000 Desired ROI 10% Expected number of units to be produced and sold 1,000 Given this information the desired markup percentage and selling price is:
Business
1 answer:
MrRissso [65]3 years ago
6 0

Answer:

markup 200% over cost

selling price 75 dollars

Explanation:

investment 500,000

return on investment : 10%

500,000 x 10% = 50,000

units producted: 1,000

markup per unit: 50,000 / 1,000 = 50 dollar

the markup will be: 25 * X = 50

X = 2 = 200%

selling price: 25  + 50 = 75

75

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Morgan Sondgeroth Inc. began operations in January 2018 and reported the following results for each of its 3 years of operations
stepan [7]

Answer:

Part A) Book Value = $1,080,000

Part B) Book Value = $1,050,000

Explanation:

Part 1: To compute the book value of the common stock at December 31, 2020

To do this, we consider both the preferred and common stock values as follows:

Stockholder's equity:

<u>Preferred Stock = $500,000</u>

<u>Common stock = $750,000</u>

Retained earnings: To calculate retained earnings we need to deduct dividends in arrears to prefered stock holders and then ascribe the remaining value to retained earnings.

Dividend in Arrears= 3 years @ 8% interest per year

= 500,000 x 0.08 x 3= $120,000

<u>Remaining earnings for available to common share holders </u>

= Retained earnings balance- dividend paid to prferred stock holders.

=$800,000 (net income for 2020)- $40,000 (net loss for 2019) - $260,000 (net loss for 2018)

= $800,000-$40,000-$260,000

= $500,000 - Dividend in arrears

= $500,000- $120,000

= $380,000

<u>Book Value of Stockholders' equity</u>

Common Stock equity + Balance of retained earnings

= $700,000 + $380,000

= $1,080,000

The book value per share = $1,080,000/ outstanding shares

= $1,080,000/750,000= $1.44

Part 2: To compute the book value of the common stock at December 31, 2020 Preference stock has liquidating value of $106 per share

Stockholder's equity:

<u>Preferred Stock = $500,000</u>

Preferred stock liquidating premium = (106-100) x 5000

= $6 x 5000= $30,000

<u>Common stock = $750,000</u>

Retained earnings: To calculate retained earnings we need to deduct dividends in arrears to prefered stock holders and then ascribe the remaining value to retained earnings.

Dividend in Arrears= 3 years @ 8% interest per year

= 500,000 x 0.08 x 3= $120,000

<u>Remaining earnings for available to common share holders </u>

= Retained earnings balance- net losses from previous years - dividend paid to prferred stock holders - liquadating premium to preferred stock

=$800,000 (net income for 2020)- $40,000 (net loss for 2019) - $260,000 (net loss for 2018)

= $800,000-$40,000-$260,000

= $500,000 - Dividend in arrears - liquidating

= $500,000- $120,000- $30,000

= $350,000

<u>Book Value of Stockholders' equity</u>

Common Stock equity + Balance of retained earnings

= $700,000 + $350,000

= $1,050,000

The book value per share = $1,080,000/ outstanding shares

= $1,050,000/750,000= $1.4

6 0
3 years ago
Suppose a​ profit-maximizing monopolist is producing 12001200 units of output and is charging a price of ​$60.0060.00 per unit.
antiseptic1488 [7]

Answer:

Marginal Cost = $30

Explanation:

Given that

Price = $60

Elasticity of demand = -2

Recall that

MC = P(1 + 1/Ed)

From monopolist pricing rule as a function of elasticity of demand.

Where MC = marginal cost

Ed = elasticity of demand = -2

Thus

MC = 60 (1 + 1/-2)

= 60 (1 + [-0.5])

= 60 ( 1 - 0.5)

= 60 (0.5)

= 30

MC = $30

6 0
2 years ago
Pooler Corporation is working on its direct labor budget for the next two months. Each unit of output requires 0.78 direct labor
Aneli [31]

Answer:

$122,752

Explanation:

The computation of total combined direct labor cost is shown below:-

Total number of units to be produced in April and May = 6,900 + 6,700

= 13,600

Total direct labor hours required = Total number of units to be produced × Output units

= 13,600 × 0.78

= 10,608

The total combined direct labor cost for the two months = Hours in total each month × 2 months × Direct labor rate

=5,480 × 2 × $11.20

= $122,752

7 0
3 years ago
Friday Night, Inc. manufactures high-quality 5-liter boxes of wine which it sells for $14 per box. Below is some information rel
Setler [38]

Answer:

b. $5.01

Explanation:

practical capacity = 310 x 16 x 250 = 1,240,000 boxes of wine per year

fixed overhead costs = $4,000,000 / 1,240,000 = $3.23 per box of wine

variable manufacturing costs = $1,762,200 / 990,000 = $1.78 per box of wine

total production costs per unit when practical capacity is used = $3.23 + $1.78 = $5.01 per box of wine

7 0
3 years ago
Sun Devil Hair Design has the following transactions during the month of February.(1) February 2 Pay $700 for radio advertising
posledela

Answer:

Sun Devil Hair Design

Journal Entries:

February 2:

Debit Advertising Expense $700

Credit Cash Account $700

To record the payment for advertising for the month of February.

February 7:

Debit Supplies $1,300

Credit Accounts Payable $1,300

To record the purchase of supplies on account.

February 14:

Debit Cash Account $2,900

Credit Service Revenue $2,900

To record the provision of beauty services to customers for cash.

February 15:

Debit Salaries Expense $900

Credit Cash Account $900

To record the payment of employee salaries for the month.

February 25:

Debit Accounts Receivable $1,000

Credit Service Revenue $1,000

To record the provision of beauty services on account.

February 28:

Debit Utility Expense $300

Credit Cash Account $300

To record the payment of utility bill.

Explanation:

Sun Devil Hair Design uses the general journal to record the its daily business transactions.  The entries are made to reflect the accounting equation of Assets being equal to Liabilities + Equity at all times.  When entering transactions in the general journal, the first step is to identify the accounts that are affected by each transaction.  The account to be debited is recorded first followed by the account to be credited.  Note that more than two accounts can be involved.  However, with the double entry system of accounting, the accounting equation is always in balance.

3 0
3 years ago
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