The question is incomplete. The following is the complete question.
Sag Manufacturing is planning to sell 400,000 hammers for $6 per unit. The contribution margin ratio is 20%. If Sweet will break even at this level of sales, what are the fixed costs?
Answer:
Fixed costs are $480000
Explanation:
The break even sales is the value of total sales or total revenue where it equals total cost and the company makes no profit or no loss. The break even in sales is calculated by dividing the fixed costs by the contribution margin ratio.
Break even in sales = Fixed cost / Contribution margin ratio
Plugging in the available values we can calculate the value of fixed cost. We know that the break even in units is at 400000 units. Thus, its value in sale will be 400000 * 6 = 2400000
2400000 = Fixed cost / 0.2
2400000 * 0.2 = Fixed cost
Fixed costs = $480000
Answer:
A. reduce output and increase price.
Explanation:
In the case of monopolistic firm at the time of profit maximization, the marginal revenue should be equivalent to the marginal cost i.e.
Marginal revenue = Marginal cost
When the marginal cost rises, the cost of generating an additional unit is also rise to equate MR and MC and at the same time the output would be decreased and the price is increased also the price is more than its marginal cos
Therefore the option A is correct
Answer:
Land amount= 367,990
Interest amount= 149,010
Explanation:
this question can be solve applying the concept of future value, as it is a zero interest or zero coupon it only, it means the bond does not pay money in the time, so
where FV is future value, PV is the present value, i is the periodic interest rate and n is the number of periods. So applying to this particular problem we have:
solving we have PV=367,990
so the land value is 367,990 and the interest expenses are 517,000 - 367,990=149,010
Answer:
The right option is (B)
Explanation:
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