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Olegator [25]
3 years ago
14

Holmes Company produces a product that can either be sold as is or processed further. Holmes has already spent $50,000 to produc

e 1,250 units that can be sold now for $67,500 to another manufacturer. Alternatively, Holmes can process the units further at an incremental cost of $250 per unit. If Holmes processes further, the units can be sold for $375 each. Compute the incremental income if Holmes processes further.
Business
1 answer:
Xelga [282]3 years ago
6 0

Answer:

It is more profitable to continue processing.

Explanation:

Giving the following information:

The number of units= 1,250

It can be sold now for $67,500 to another manufacturer.

Alternatively, Holmes can process the units further at an incremental cost of $250 per unit. If Holmes processes further, the units can be sold for $375 each.

<u>The $50,000 is a sunk cost, meaning that it has already happened. It shouldn't be taken into account.</u>

Sell as it is:

Income= $67,500

Continue production:

Income= 1,250*(375 - 250)= $156,250

It is more profitable to continue processing.

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Product differentiation and advertising are profitable ventures only when:
dalvyx [7]

Answer:

Product differentiation and advertising are profitable ventures only when:

the gain in total revenue outweighs the extra cost

Explanation:

When Company XYZ differentiates its product from competitors' through trademarks and other differentiating factors and embarks on advertising, it must watch out for cost overrun.  The undertaking for the product differentiation and advertising should be able to generate more revenue than the costs.  This will make Company XYZ determine that its differentiation and advertising make economic meaning by producing positive NPV.

3 0
3 years ago
Arbor Corporation had reported the following amounts at December 31, 2014: Sales revenue $184,000: ending inventory $11,600: beg
Rudiy27

Answer:

The cost of goods available for sale is $74100.

Explanation:

The cost of goods available for sale is the total cost of the inventory that a business has available during a period of time for sale. The cost of goods available for sale is calculated by adding the beginning inventory with the cost of goods purchased.

The cost of goods purchased during the year = 60400 - 3000 - 1100 + 600 = $56900

The cost of goods available for sale = Beginning inventory + cost of goods purchased

The cost of goods available for sale =  17200 + 56900 = $74100

5 0
3 years ago
Which of the following has the largest impact on opportunity cost?
Mrrafil [7]
Consumer wants because the want of people are very greedy and needs to be decreased but it’s not so it’s at its largest
6 0
2 years ago
Read 2 more answers
"Which of the following is correct?
ICE Princess25 [194]

Answer: Option (B) is correct.

Explanation:

The nominal GDP is equal to the real GDP in the base year, that's why GDP deflator in the base year is equal to 100.

GDP deflator is calculated as the nominal GDP divided by the real GDP multiply by 100. It is shown as:

GDP deflator = \frac{Nominal\ GDP}{Real\ GDP} \times 100

GDP deflator would be used as the conversion factor that transformed the real GDP into nominal GDP.

5 0
3 years ago
Matt and Meg Comer are married and file a joint tax return. They do not have any children. Matt works as a history professor at
babunello [35]

Answer:

$9,379

Explanation:

using the 2020 tax brackets:

the Comer's gross income = $68,000 + $33,000 + $1,500 = $102,500

taxable income = $102,500 - $24,800 (standard deduction for married couples) = $77,700

taxes owed = $1,975 + [12% x ($77,700 - $19,750)] = $8,929

capital gains = $13,000 - $10,000 = $3,000 x 15% capital gains tax rate = $450

total tax liability = $8,929 + $450 = $9,379

8 0
3 years ago
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