Answer:
Incremental Income =$8,000
Explanation:
<em>In order to carry out an incremental analysis, only relevant cash flows should be considered.</em>
<em>The relevant cash flows from accepting the special order are </em>
- <em>the variable costs </em>
- <em>sales revenue at the offer price of $14</em>
- <em>Extra shipping cost</em>
Please, note that the fixed costs are not relevant for this decision. Simply because they would be incurred either way and that are not completely traceable to this product.
Incremental income
Incremental income = (offer selling price - variable cost) × units
= 14 - (12 + 1) × 8000 =$ 8000
Incremental Income =$ 8,000
Opportunity costs represent the potential benefits an individual, investor, or business misses out on when choosing one alternative over another. The idea of opportunity costs is a major concept in economics. Because by definition they are unseen, opportunity costs can be easily overlooked if one is not careful.
Examples of Opportunity Cost. Someone gives up going to see a movie to study for a test in order to get a good grade. The opportunity cost is the cost of the movie and the enjoyment of seeing it. ... The opportunity cost of taking a vacation instead of spending the money on a new car is not getting a new car.
Answer:
Non profit organization
Explanation:
Non profit organizations do not cost anything and generally help the public in some way.
Answer:
$210,000
Explanation:
No market value was been given for the bonds.
Therefore the amount attributable to the warrants (shareholders' equity) =
Market price of each warrant was $3 ×50 detachable stock warrants per bond
=$150
Issued $1,400,000/$1,000 bond
=$1,400
Hence:
$150 × 1,400 bonds
= $210,000.
Therefore the amount that the bond should issue if proceeds increase shareholders' equity is $210,000
