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mezya [45]
2 years ago
10

Camino’s cost of goods sold and operating expenses are 80 percent variable and 20 percent fixed. Camino has received an offer fr

om a professional wrestling association to design a coffee cup endorsed by its biggest star and produce 20,000 cups to sell them for $8 each (total $160,000). These cups would be sold at wrestling matches throughout the United States. Acceptance of the order would require a $60,000 endorsement fee to the wrestling star, but no other increases in fixed expenses. Required: 1. How much would Camino's Net Operating Income
Business
1 answer:
aniked [119]2 years ago
7 0

Answer: -$140000

Explanation:

Total operating expenses, = fixed costs + variable cost

Fixed cost is 20% = $60000

Variable cost is 80%

Therefore Total Operating expenses is $300000

When we subtract the total operating expenses (300000) from the total revenue (160000) , we get -140000.

Camino's is having a net operating loss of $140000. To make profit, they need to sell above 37500 cups

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Kicks corporation sells running shoes and during janurary they ran production machines for 20000 total hours and incurred 9000 i
Dafna11 [192]

Answer:

$0.3 per machine hour

Explanation:

The computation of the variable maintenance cost per machine hour using the high low method is shown below:

Variable cost per machine hour = (High maintenance cost - low maintenance  cost) ÷ (High machine hours - low machine hours)

= ($9,000 - $7,200) ÷ (20,000 machine hours - 14,000 machine hours)

= $1,800 ÷ 6,000 machine hours

= $0.3 per machine hour

7 0
3 years ago
A retail store credited the sales revenue account for the sales price and the amount of sales tax on sales. if the sales tax rat
alexira [117]
We have to calculate the amount of the sales taxes owed to a taxing agency.
The tax rate is 5% ( 0.05 ) and the balance in the sales revenue account amounted to $294,000.
$294,000 * 0.05 = $14,700
Answer:
Amount of the sales taxes is B ) $14,700.
8 0
3 years ago
A $1,000 face value bond currently has a yield to maturity of 6.69 percent. The bond matures in 3 years and pays interest annual
algol [13]

Answer:

$1,008.18

Explanation:

Using a financial calculator, you can calculate the price of this bond with the following inputs;

Maturity of the bond; N= 3

Face value ; FV = 1000

Annual coupon payment; PMT = 7% *1000 = 70

Yield to maturity ; I/Y = 6.69%

then compute the Price;  CPT PV = 1,008.182

Therefore, the current price is $1,008.18

6 0
3 years ago
What is the basic purpose of the consumer price index (CPI)? A. to track monthly changes in prices paid by urban consumers B. to
Elina [12.6K]

Answer:

A). to track monthly changes in prices paid by urban consumers.

Explanation:

CPI(Consumer Price Index) is characterized as 'a statistical estimate of the price level of goods and services bought by consumers for consumption purposes by the households.' It primarily aims to estimate the change or swap in the prices of the weighted average price of the common basket(consumption goods, as well as, services that the consumers pay for). It is calculated using the formula;

CPI_{t}  = \frac{C_{t} }{C_{0} } * 100

where,

CPI_{t} = current Consumer Price Index

C_{t} = Current price basket

C_{0} = Cost of price basket in the base year

It assists in deducing whether the average prices have received a fall or rise and determines inflation or deflation. Thus, <u>option A</u> is the correct answer.

6 0
3 years ago
Altoona Corporation has two divisions, Hinges and Doors, which are both organized as profit centers. The Hinge Division produces
Luden [163]

Answer:

Minimum transfer price = $21

Explanation:

<em>Transfer price is the price at which goods are exchange between branches or divisions of the same group</em>

<em>Where  a division is operating at the less than the existing capacity, to optimist the group profit, the minimum transfer price should be set as follows</em>

Minimum transfer price = Variable cost

Note that the fixed of $12 per unit (i.e 33-21) is irrelevant for this purpose, whether or not Hinges produces, it will be incurred either way.

It is worthy of note that there is no opportunity cost associated with any transfer to the Doors division because Hinges is currently having excess capacity.

Therefore, any offering price equal to or above the variable cost of $21 would be acceptable and optimize the group profit.

Hence, the minimum transfer price = $21

3 0
3 years ago
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