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Zinaida [17]
4 years ago
10

Choose a real or made up example of a company, and describe at least three fixed costs the company has.

Business
1 answer:
bonufazy [111]4 years ago
6 0
(any company) Payroll for employed workers, Property costs, and taxes.
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Shaun is a student who has received an academic scholarship to State University. The scholarship paid $14,000 for tuition, $2,50
Soloha48 [4]

Answer:

$ 8500 paid by the university

Explanation:

The dormitory fees are recorded as part of his gross income because it is a payments given to his services rendered which was counseling freshman on campus living. The dormitory fees gotten can be taxed for this reason unlike the scholarships received for tuition, fees, books can be excluded from gross income as they are required for the student courses.

8 0
3 years ago
Bryce Corporation has pretax accounting income of $100,000. Bryce has interest on municipal bonds of $7,000. Depreciation for ta
Ket [755]

Answer:

$90,000

Explanation:

It is given that :

The pretax accounting income of Bryce Corporation               100,000

The interest on the municipal bonds                                            - 7,000

The depreciation                                                                            - 5,000

The difference in bad debt expense (3000-1000)                   <u>    +2,000</u>

So the total income of Bryce Corporation                                  $ 90,000                      

4 0
3 years ago
Which is the best option for people who need the items immediately but cannot pay cash now?
professor190 [17]
<h2>Answer</h2>

Buy on Credit

<h3>Explanation</h3>

When in a liquidity problem and items have to be bought, buying on credit seems to be the best option. Buying on credit allows immediate ownership of required items whereas the money can be paid later as per the credit policy and terms. This permits the consumer to take the advantage of item ownership with delayed payment hence double advantage.

7 0
3 years ago
Read 2 more answers
Whitewater Rapids provides canoes to tourists eager to ride Whitewater river's rapids. Management has determined that there is o
alina1380 [7]

Answer:

Expected loss without insurance = $850

Explanation:

Given:

Probability to got injured or killed = 1 / 1000

Law suit average cost = $850,000

Deductible insurance = $100,000

Expected loss without insurance = ?

Computation of Expected loss without insurance:

Expected loss without insurance = Lawsuit average cost × Probability to get injured or killed

Expected loss without insurance = $850,000 × (1 / 1000)

Expected loss without insurance = $850

8 0
3 years ago
Lou Barlow, a divisional manager for Sage Company, has an opportunity to manufacture and sell one of two new products for a five
andrey2020 [161]

Answer:

1. Calculate the payback period for each product.

  • A = 2.71 years, A is preferred
  • B = 2.8 years

2. Calculate the net present value for each product.

  • A = $60,349
  • B = $83,001, B is preferred

3. Calculate the internal rate of return for each product.

  • A = 25%, A is preferred
  • B = 23%

4. Calculate the project profitability index for each product.

  • A = 121%, A is preferred
  • B = 117%

5. Calculate the simple rate of return for each product.

  • A = 184%, A is ´preferred
  • B = 179%

6B. Based on the simple rate of return, Lou Barlow would likely:

  • 1. Accept Product A, since its IRR is 25% which exceeds the company's  minimum ROI (23%)

Explanation:

                                       Product A               Product B

Initial investment:

Cost of equipment          $290,000              $490,000

Annual revenues and costs:

Sales revenues              $340,000               $440,000

Variable expenses         $154,000               $206,000

Depreciation expense    $58,000                 $98,000

Fixed out-of-pocket

operating costs               $79,000                 $59,000

net cash flow                  $107,000                $175,000

The company's discount rate is 16%.

payback period

A = $290,000 / $107,000 = 2.71 years, A is preferred

B = $490,000 / $175,000 = 2.8 years

using an excel spreadsheet I calculated the NPV and IRR

NPV

A = $60,349

B = $83,001, B is preferred

IRR

A = 25%, A is preferred

B = 23%

Project profitability

A = $350,349 / $290,000 = 1.21

B = $573,001 / $490,000 = 1.17

Simple rate of return

A = $535,000 / $290,000 = 184%, A is ´preferred

B = $875,000 / $490,000 = 179%

5 0
3 years ago
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