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Temka [501]
3 years ago
15

Swisher, Incorporated reports the following annual cost data for its single product: Normal production level 30,000 units Direct

materials $ 6.40 per unit Direct labor $ 3.93 per unit Variable overhead $ 5.80 per unit Fixed overhead $ 150,000 in total This product is normally sold for $48 per unit. If Swisher increases its production to 50,000 units, while sales remain at the current 30,000 unit level, by how much would the company's income increase or decrease under absorption costing?
Business
1 answer:
wlad13 [49]3 years ago
4 0

Answer:

Profit decreases by $322,600

Explanation:

Normal production level = 30,000 units

Cost of direct material per unit =$6.40 , total cost = $6.40*30,000=$192,000

Cost of direct labor per unit =$3.93 , total cost =$3.93*30,000=$117,900

Variable over head cost per unit=$5.80, total cost =$5.80*30,000=$174000

Fixed overhead total cost = $150,000

Production cost with 30,000 units will be;

$192,000 + $117,900 + $174000 + $150,000 =$633900

Normal selling price of product  per unit = $48

Revenue after normal sell of 30,000 units $48 = 30,000*48=$1440000

Profit obtained : $806,100

Increasing the production to 50,000 units you can calculate the projected cost of production

New production level = 50,000 units

Cost of direct material per unit =$6.40 , total cost = $6.40*50,000=$320,000

Cost of direct labor per unit =$3.93 , total cost =$3.93*50,000=$196,500

Variable over head cost per unit=$5.80, total cost =$5.80*50,000=$290,000

Fixed overhead total cost = $150,000

Production cost with 30,000 units will be;

$320,000 + $196,500 + $290,000 + $150,000 =$956,500

Normal selling price of product  per unit = $48

Revenue after normal sell of 30,000 units $48 = 30,000*48=$1440000

Profit obtained =$483,500

Decreased in profit = $806100-$483500 =$322,600

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Juliette [100K]

Answer:

The correct answer is option D.

Explanation:

The money equation given by Irving fisher is popularly known as fisher's equation.

The equation is given as MV=PT

Here, M represents money supply, V is the velocity of money, P is the price level and T refers to the volume of transactions or output level.

The supply of money refers to the quantity of money in existence while the velocity of transactions shows the number of times, money changes hands.  Together they show the volume of money in circulation.

P is the average price level and T represents the expenditures on all transactions or, in other words, output level.  

Here, V and T are assumed to be constant. This means that the money supply directly affects the price level.  

There is no explicit mention of the interest rate in this equation.  

So, option D is the correct answer.

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3 years ago
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IgorLugansk [536]

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the other options are wrong:

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Alex787 [66]

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8 0
3 years ago
What role do sources play in validating an argument? Are we able to rely on the internet to provide complete and truthful inform
Andrej [43]

Incomplete question. However, I answered from a general research perspective.

<u>Explanation:</u>

<em>What role do sources play in validating an argument?</em>

Well, the term source basically refers to the originator of any information. We have sources that are considered <em>credible sources</em> (like Encyclopedia, Journal Magazine, Newspaper, etc) and others that are considered <em>incredible sources </em>(general social media post). Knowing the kind of source could thus help validate an argument.

Relying on the internet to provide complete and truthful information is difficult considering the amount of fake news available today.

8 0
3 years ago
Kuyu Company uses the periodic inventory system. Kuyu started the period with $12,000 in inventory. The Company purchased an add
a_sh-v [17]

Answer:

$29,500

Explanation:

Given that,

Beginning inventory = $12,000

Ending inventory = $6,000

Purchases = $25,000

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= $29,500

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