Answer:
Statement B is correct.
Explanation:
High Operating Leverage represents higher fixed cost in comparison to variable cost, and thus that means the company will get its break even earlier or we can say with low units, but after break even profits will be higher.
As in the given case Firm A has higher Operating Leverage than Firm B, thus Firm A has lower Break even point but eventually its profit after reaching break even will grow higher.
Thus, Statement B is correct
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Answer:
The value of the intangible will remain at $350,000
Explanation:
The reason is that the International Accounting Standard IAS-36 says that once the impairment is recognized for the intangible assets it can not be reversed which means that the amount reported would be $350,000. The reason is that it is very rare that the asset gain its value and specially those which are intangible assets. Most of the management in the 1990s-2000 tried to recognize a gain on impairment which was unjustifiable to increase their profits for the period so the standard specifically didn't permitted gain on a previously impaired asset.
Answer:
Option (B) is correct.
Explanation:
Given that,
During a period, Department B finished and transferred to Department C = 58,000 units
In Department B during the period units started = 14,000
Brought only to a stage of being 60% completed.
The number of equivalent units produced by Department B during the period was:
= Units finished and transferred from Department B to C + (Units were started in Department B × 60%)
= 58,000 units + (14,000 units × 60%)
= 58,000 units + 8,400 units
= 66,400 units
