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3 years ago

How can producers maximize their profit? Check all that apply.

Business

1 answer:

I am Lyosha [343]3 years ago

8 0

Answer:

They can work to decrease their marginal cost.

They can raise prices to increase marginal revenue,

They can keep marginal costs below marginal revenues,

Explanation:

Marginal cost is the additional expense incurred by producing an extra unit. Marginal revenue is the extra profit realized by selling an additional product or service. To maximize profits, firms should stop selling and production activities when the marginal cost equal to marginal revenue. A profit-maximizing firm is profitable when marginal revenue is greater than or equal to marginal cost.

Profit is obtained by deducting expenses from revenue. To increase profits, a firm should put more effort into increasing revenues while minimizing costs. A profit-maximizing firm should, therefore, work hard to decrease marginal cost and improve its marginal revenue.

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Mohave, Inc. produces approximately 4,000 units per month, and it places a quality assurance logo on each of its units. To use t

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Answer:

mixed cost.

Explanation:

The cost to Mohave of using the quality assurance logo would be a mixed cost.

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ABC Insurance retains the first $1 million of each property damage loss and purchases insurance 22) for that part of any propert

Sliva [168]

Answer:

B) excess insurance

Explanation:

Excess insurance is also known as excess waiver insurance and is amount that will be paid in case of an accident that exceeds normal insurance cover. The amount covered by excess insurance is agreed between the beneficiary and the insurance company.

It protects one against excess charges in cases where a car is stolen or damaged.

For example of you hire a car that has standard insurance, and it is involved in an accident. If the damage is above the limit of insurance cover you will have to pay the rental company the excess for the repairs. Excess insurance covers costs that are high, with some covering up to $6,000.

So if ABC purchases insurance for part of property loss that exceeds $1 million, they are purchasing excess insurance to protect themselves from loss.

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3 years ago

A company purchased a building for $850,000 on January 1, 2010. As of December 31, 2014, $200,000 of accumulated depreciation ha

AVprozaik [17]

Answer:

On the sale of this building, the company should recognize:_______

c. A gain of $600,000

Explanation:

a) Data and Calculations:

The cost for the Purchase of building on January 1, 2010 = $850,000

Accumulated depreciation as of December 31, 2014 = 200,000

Book value of building as of December 31, 2014 = $650,000

Sale proceeds on January 1, 2015 = $1,250,000

Gain from the sale of the building = $600,000

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3 years ago

In its cash flow statement for the current year, Fox Co. reported cash paid for interest of $70,000. Fox did not capitalize any

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Answer:

$76,000

Explanation:

The calculation of the interest expense is shown below:

= Reported amount of cash paid for interest + Decrease in prepaid interest - decrease in accrued interest payable

= $70,000 + $23,000 - $17,000

= $76,000

The decrease in prepaid interest is classified as a current asset and the accrued interest payable is current liabilities and we know that the rise in current assets and a decline in current liabilities are excluded, while the decline in current assets and an increase in current liabilities are included.

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3 years ago

Two operationally similar companies, HD and LD, have identical amounts of assets, operating income (EBIT), tax rates, and busine

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Answer:

Company HD has a higher return on equity (ROE) than Company LD, and its risk as measured by the standard deviation of ROE is also higher than LD's.

Explanation:

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