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3 years ago

For purposes of decision making, avoidable costs are costs that:

1 answer:

6 0

Avoidable cost refers to variable costs that can be avoided. It is a cost that can be foregone by not partaking in or no longer performing an activity that will lead to incurring said cost.For example, a business organization looking for methods to reduce or eliminate expenses often analyze the avoidable costs associated with the project.

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Net loss means expenses is _____ gross profit?

sveticcg [70]

Answer:

net loss means expenses is ____ gross profit?

a. greater than

→b. less than

c. equals

d. none of the above

Explanation:

#Carry On Learning

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Choi Eunbyul <3

3 0

2 years ago

Ramon has been appointed the manager of a retail store. He wants to bring the store into the modern era and direct its future by

nika2105 [10]

Answer:

C. install mannequin robots to display clothes

Explanation:

Among the offered answers, a truly avantgarde, modern approach is to implement robot mannequins in the store. With this tactic, customers would be incentivized to approach this innovative customer journey. Through pioneering this technique, Ramon's company would get a competitive advantage through visual merchandising.

6 0

3 years ago

3 types of AIDE that USA uses to alleviate poverty?

bonufazy [111]

The three types are Pass Bill, More importance to Funding to foreign aid and work with other government and international organisations. The fist one pass bill, US government always take responsibility to pass bill to reduce global poverty. The second one concentrate on foreign funding is increased by getting more donors is used to develop the nations. The last one is work with others, supports collaborations and partnership is used to give more power to the US.

5 0

3 years ago

The Accounts Receivable balance for Lake, Inc. at December 31, 2017, was $ 20 comma 000. During 2018, Lake earned revenue of

elena-s [515]

Answer:

The required journals are:

Debit Bad debt expense $10,070

Credit Allowance for doubtful accounts $10,070

(To record bad debt for the year)

Explanation:

To understand the effects of the transactions, we need to journalize as follows:

Debit Accounts receivable $454,000

Credit Sales revenue $454,000

(To record sales transaction on account)

Debit Cash $325,000

Credit Accounts receivable $325,000

(To record collections on account)

Debit Allowance for doubtful accounts $5,600

Credit Accounts receivable $5,600

(To record write-off of accounts receivable)

With the above journals, the balance in accounts receivable will be: $20,000 + $454,000 - $325,000 - $5,600 = $143,400. The 5% of $143,400 will be $7,170.

The effect of the write-off was to throw the unadjusted allowance for doubtful account into debit as $2,700 - $5,600 = $2,900. The required bad debt expense will $10,070 ($7,170 + $2,900).

3 0

3 years ago

The Campbell Company is considering adding a robotic paint sprayer to its production line. The sprayer's base price is $940,000,

Tanya [424]

Answer:

a. Year 0 Net Cash Flows = $984,000

b. We have:

Year 1 net operating cash flows = $306,159

Year 2 net operating cash flows = $332,986

Year 3 net operating cash flows = $261,479

c. Additional Year 3- cash flow = $504,877

d. The machine should be purchased.

Explanation:

We start by first calculating the following:

Initial Investment = Base Price + Modification Cost = $940,000 + $25,000 = $965,000

Useful Life = 3 years

Depreciation in Year 1 = 0.3333 * $965,000 = $321,634.50

Depreciation in Year 2 = 0.4445 * $965,000 = $428,942.50

Depreciation in Year 3 = 0.1481 * $965,000 = $142,916.50

Book Value at the end of Year 3 = $965,000 - $321,634.50 - $428,942.50 - $142,916.50 = $71,506.50

After-tax Salvage Value = Salvage Value - (Salvage Value - Book Value) * Marginal tax rate = $624,000 – ($624,000 - $71,506.50) * 25% = $485,877

Initial Investment in NWC = $19,000

We can now proceed as follows:

a. What is the Year 0 net cash flow?

Year 0 Net Cash Flows = Initial Investment + Initial Investment in NWC = $965,000 + $19,000 = $984,000

b. What are the net operating cash flows in Years 1, 2, 3?

Year 1 net operating cash flows = (Pretax Cost Saving * (1 - tax)) + (tax * Depreciation in year 1) = ($301,000 * (1 – 0.25)) + (0.25 * $321,634.50) = $306,159

Year 2 net operating cash flows = (Pretax Cost Saving * (1 - tax)) + (tax * Depreciation in year 2) = ($301,000 * (1 – 0.25)) + (0.25 * $428,942.50) = $332,986

Year 3 net operating cash flows = (Pretax Cost Saving * (1 - tax)) + (tax * Depreciation in year 3) = ($301,000 * (1 – 0.25)) + (0.25 * $142,916.50) = $261,479

c. What is the additional Year 3- cash flow (i.e. after tax salvage and the return of working capital)?

Additional Year 3- cash flow = NWC recovered + After-tax Salvage Value = $19,000 + $485,877 = $504,877

d. If the project's cost of capital is 12%, should the machine be purchased?

This can be determined from the net present value (NPV) calculated as follows:

NPV = -$984,000 + ($306,159/1.12^1) + ($332,986/1.12^2) + ($261,479/1.12^3) + ($504,877/1.12^3) = $100,287.71

Since the NPV of the machine of $100,287.71 is positive, the machine should be purchased.

7 0

3 years ago