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vivado [14]
3 years ago
6

. How does analyzing fixed and variable costs help you to set a sale price that will generate profit? 2. How is profit affected

when a company produces outside it's "relevant range" (normal range of activity)? Explain?
Business
1 answer:
ELEN [110]3 years ago
4 0

Answer:

1. Apart from helping to know the average cost of a product, analyzing fixed and variable cost will help to derive the break even point.

2. Profit will go down

Explanation:

1. The size of the selling price and the variable cost determine contribution per unit of a product. Contribution per unit is Price minus variable cost. This shows the  contribution of sales revenue towards covering the fixed cost of a product.

2. Relevant range is the estimated or budgeted activity level which defines a business volume of production or operation, it is both maximum and minimum threshold within which the entity must operate to expect certain level of cost and revenue.

Sometimes fixed costs are fixed within a relevant range of activities and outside such range, fixed cost may become variable, which will all things being equal impact negatively on the price.

Also, within relevant range volume discount may be achieved and outside such range, this may be forfeited which, will also reduce profit all things being equal.

You might be interested in
QUESTION 4 / 10
Umnica [9.8K]

Answer:

C. The longer you use credit responsibly, the higher your

credit score will be.

Explanation:

A credit card allows its user to access a short term loan. Every payment made via a credit card is considered a loan. The loan attracts interest monthly. Defaulting on credit card payments is similar to defaulting on any other loan type.

Responsible use of a credit card entails using it only when necessary. It means making prompt payments to clear monthly bills.

Credit card history is important information when tabulating an individual's credit score.  Anyone who uses their credit card responsibly ends up with a good credit score.

3 0
3 years ago
What is the primary purpose of job specialization A. Regional self-sufficiency B. Increased consumer income C. Increased margina
marishachu [46]

Answer:

D. Increased efficiency and productivity

Explanation:

Job specialization can be defined as a strategic process which typically involves the ability of employees working in an organization to develop specific skills, knowledge, great expertise or professionalism and experience to perform their duties, tasks or job functions effectively and efficiently.

In order to gain the requisite skills, expertise and knowledge for job specialization, it is very important for the employees to have undergone an extensive training and a good number of years in work experience.

The primary purpose of job specialization is to increase efficiency and productivity because the employees are able to specialize in the use of specific tools (equipments) to accomplish their tasks, as well as limit the level of error or mistakes in the production process.

6 0
4 years ago
A company with $900,000 in operating assets is considering the purchase of a machine that costs $92,000 and which is expected to
Alex

Answer:

3.83 years

Explanation:

The payback period measures how long it takes for the amount invested in a project to be recovered from the cumulative cash flows.

It is a capital budgeting technique that doesn't account for the time value of money.

Payback period = Cost of asset / cash flows

$92,000/ $24,000 = 3.83 years

I hope my answer helps you

8 0
3 years ago
Read 2 more answers
What is the most common reason small business owners neglect to seek outside help when starting a business?
lesya [120]
They assume that no one outside of their family would be interested in helping them
6 0
4 years ago
Craydye Corporation manufactures a part for its production cycle. The costs per unit for 8,000 units of this part are as follows
irakobra [83]

Answer:

Make; $72,000

Working:

Make ($106*8000)                         848,000

Buy [($120*8000 - 40,000)]           920,000

Make increases profits by              72,000

7 0
3 years ago
Read 2 more answers
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