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Margarita [4]
3 years ago
15

CVP computations. Garrett Manufacturing sold 410,000 units of its product for $68 per unit in 2017. Variable cost per unit is $6

0, and total fixed costs are $1,640,000.Required:1. Calculate (a) contribution margin and (b) operating income.2. Garrett’s current manufacturing process is labor intensive. Kate Schoenen, Garrett’s production manager, has proposed investing in state-of-the-art manufacturing equipment, which will increase the ­annual fixed costs to $5,330,000. The variable costs are expected to decrease to $54 per unit. ­Garrett expects to maintain the same sales volume and selling price next year. How would acceptance of Schoenen’s proposal affect your answers to (a) and (b) in requirement 1?3. Should Garrett accept Schoenen’s proposal? Explain.
Business
1 answer:
Masteriza [31]3 years ago
5 0

Answer:

a) 8 dollars

b) 1,640,000

2.-  It should be rejected as decreases operating income to 410,000 from 1,640,000

contribution margin: $14

operating income: $ 410,000

Explanation:

Sales \: Revenue - Variable \: Cost = Contribution \: Margin

68 - 60 = 8

b)

units sold x $8 contribution less fixed cost

410,000 x 8 - 1,640,000 = 1,640,000

2 contribution margin:

68 - 54 = 14

410,000 x 14 - 5,330,000 = 410,000

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After identifying and performing the preliminary classification of an organization’s information assets, the analysis phase move
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Answer:

threats

Explanation:

Based on the information provided can be said that the analysis phase moves on to an examination of the threats facing the organization. This is the process of focusing on the individuals or organizations that may cause problems for the organization in the future, in order to design a plan on how to tackle those situations.

5 0
3 years ago
A tremendous flood along the Mississippi River destroys thousands of factories, reducing the nation's capital stock by 5%. What
motikmotik

Answer:

Both employment and the real wage rate would decrease

Explanation:

Given that the capital stock of a nation or country jas a direct impact on such country in terms of savings and investments which directly translates to additional.economic development.

Hence, in this case, when a tremendous flood along the Mississippi River destroys thousands of factories, reducing the nation's capital stock by 5%. What happens to current employment and the real wage rate is that "Both employment and the real wage rate would decrease"

This because there won't be adequate money available to create more employment. And with lease employment opportunities than the available labor, the real wage rate tends to decrease over time.

4 0
3 years ago
If a company incorrectly records cash received for services to be provided in the future with a debit to cash and a credit to sa
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There will be inadequate liabilities.

What Does Sales Revenue Mean?

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to know more about sales revenue

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8 0
2 years ago
Elston Company issued $500,000 of eight percent, 20-year bonds at 106 on January 1, 2010. Interest is payable semiannually on Ju
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Answer:

Please see attachment

Explanation:

Please see attachment

8 0
3 years ago
Harry Corporation's common stock currently sells for $180 per share. Harry just paid a dividend of $10.18 and dividends are expe
Anastasy [175]

Answer:

$190.64

Explanation:

Data provided in the question:

Current selling price of shares = $180 per share

Dividend paid = $10.18

Expected growth rate, g = 6% = 0.06

Required rate of return, r = 12% = 0.12

Now,

The dividend for the following year to the next year, D1 = $10.18 × (1 + g)ⁿ

here, n = 2 ( i.e the duration of next year and the following year )

thus,

D1 = $10.18 × (1 + 0.06)²

or

D1 = $11.438

Therefore,

Price of stock one year from now = \frac{\textup{D1}}{\textup{(r-g)}}

= \frac{\textup{11.438}}{\textup{0.12-0.06}}

= 190.637 ≈ $190.64

7 0
3 years ago
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