Answer:
a. in order to calculate this we must assume that the economy entered a recession:
degree of operating leverage = [($20 - $70)/$70] / [($260 - $520)/$520] = -0.7143 / -0.5 = 1.43
b. $14 million
Explanation:
strong economy:
total sales $520 million
<u>variable costs $420 million</u>
gross profit $100 million
<u>fixed costs $30 million</u>
EBIT $70 million
<u>income taxes $21 million</u>
net income $49 million
weak economy:
total sales $260 million
<u>variable costs $210 million</u>
gross profit $50 million
<u>fixed costs $30 million</u>
EBIT $20 million
<u>income taxes $6 million</u>
net income $14 million
Answer:
None of the above
Explanation:
Companies can shorten their cash cycles by turning over their inventory faster. The quicker a company sells its goods, the sooner it takes in cash from cash and credit card sales and begins its accounts receivable aging. Inventory turnover has no impact on the cash cycles of service companies with no inventory.
Answer: c. They would do better charging $15 than $10.
Explanation:
It is given that Max and Maddy total cost of car parking remains the same, that is it does not matter whether they have seven or five cars parked on their lawn. So, since total cost is constant, Max and Maddy's decision would depend on total revenue.
Total revenue from charging, $10 is $70,
Total revenue from charging $15 is $75.
Since, total cost is constant, Max and Maddy will choose to charge $15 since it is giving them $5 more.
A. assessed value of the home
I hope this helps
