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3 years ago

Suire Corporation is considering dropping product D14E. Data from the company's accounting system appear below:

Business

1 answer:

Oksana_A [137]3 years ago

7 0

Answer and Explanation:

a. The computation of the net operating income earned is shown below:

Sales $800,000

Less: Variable cost -$381,000

Contribution margin $419,000

Less: Fixed manufacturing expenses - $263,000

Less : Fixed selling and administrative expenses - $211,000

Net operating income or (Loss) -$55,000

b. The computation of the financial advantage (disadvantage) of dropping product D14E is shown below:

Sales $800,000

Less: Variable cost -$381,000

Contribution margin $419,000

Less: Fixed manufacturing expenses - $202,500

Less : Fixed selling and administrative expenses - $117,500

Financial disadvantage -$99,000

Since there is a financial disadvantage so the product should not be dropped

We simply applied the above equation

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What is the purpose of tax-deferred retirement accounts?

kobusy [5.1K]

Allows individuals to set up a retirement account at financial institutions to save money for retirement. Usually has a tax free growth or tax deferred basis.

Is this free answer or is there a multiple choice?

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3 years ago

Cash in Hand” considered as_____? 1 point Investment Liability Retained Earnings Asset

asambeis [7]

Answer:

Asset

Explanation:

<em>In accounting/investment, cash in hand is generally considered to be an asset.</em>

<u>Cash in hand is considered a liquid asset due to the fact that it can easily be accessed or utilized to settle liabilities or acquire other assets. For example, cash in hand can be used to acquire properties, furniture, electronics, etc all of which are considered assets. </u>

Hence, the correct answer is asset.

8 0

3 years ago

he variable operating cost consists of gasoline, oil, tires, maintenance, and repairs. Kristen estimates that, at her current ra

OverLord2011 [107]

Answer: $0.51

Kristen Lu purchased a used automobile for $25,950 at the beginning of last year and incurred the following operating costs:

Depreciation ($25,950 ÷ 5 years) $5,190

Insurance $2,700

Garage rent $1,400

Automobile tax and license $710

Variable operating cost $0.11 per mile

The variable operating cost consists of gasoline, oil, tires, maintenance, and repairs. Kristen estimates that, at her current rate of usage, the car will have zero resale value in five years, so the annual straight-line depreciation is $5,190. The car is kept in a garage for a monthly fee.

Explanation:

To calculate the fixed cost per mile, calculate the total fixed cost and divide by the number of miles (25000).

The total fixed cost combines all the cost that do not change depending on the level of usage. These costs do not reduce if Kristen uses her car less or increase if she uses her car more. The variable cost is the opposite of this.

Total fixed cost = $5,190 + $2,700 + $1,400 + $710 = 10,000

Fixed cost per mile = 10000/25000 = $0.40

Variable Operating Cost/Mile = $0.11

Average Operating Cost/Mile = $0.51

5 0

3 years ago

Consider a business cycle theory that combines the classical âIS-LM model with the assumption that temporary changes in governme

docker41 [41]

Answer: The answer is given below

Explanation:

The IS-LM model, simply is an acronym which represents "investment-savings" and the "liquidity preference of money supply". The model indicates the interaction between market for economic goods and the loanable funds market which is also called the money market.

The variables are explained below:

a. Employment: A rise in the spending expenditure will result into an increase in the current or future taxes which will have an effect on the workers by making them poorer and therefore making them offer their services to the labor market. This will lead to a rise in labor supply.

b. The real wage: Due to the increase in labor supply, the real wage will reduce because the supply of labor will be more than the demand.

c. Average labor productivity: The marginal productivity of labor or production function is not influenced by fiscal policy changes.

d. Investment: There will be a leftward upward shift of the LM curve. Due to increase in price of goods and services, and the fall in real money supply, the interest rate will rise therefore making investment to reduce.

e. The price level: Demand for output is more than the full employment level of output. This will bring about increase in price.

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3 years ago

In reconciling net income to taxable income, interest earned on municipal bonds is: Multiple Choice Ignored. A temporary differe

Nostrana [21]

Answer:

A permanent difference.

Explanation:

In accounting, a permanent difference refers to a transaction that is reported differently for financial purposes than for taxation purposes. Interest earned from municipal bonds increases the company's revenue, but since it is not taxed (at least not subject to federal taxes), it doesn't increase the taxable revenue of the company.

7 0

3 years ago