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Stells [14]
3 years ago
8

Titanic Roofing Company has estimated the following amounts for its next fiscal​ year: Total fixed costs $ 840 comma 000 Sale pr

ice per unit 60 Variable cost per unit 30 If the company spends an additional $ 35 comma 000 on​ advertising, sales volume would increase by 2 comma 500 units. Before the​ change, the​ company's sales level exceeds the breakeven point. What effect will this decision have on the operating income of​ Titanic?
Business
1 answer:
Nina [5.8K]3 years ago
3 0

Answer:

Operating income increases by $40,000.

Explanation:

Given that,

Total fixed costs = $840,000

Sale price per unit = $60

Variable cost per unit = $30

Additional amount spend on advertising = $35,000

Sales volume would increase by 2,500 units.

Contribution margin:

= Sales - Variable costs

= $60 - $30

= $30 per unit

Increase in operating income:

= Increase in contribution margin - Increase in Fixed costs

= ($30 × 2,500 units) - $35,000

= $75,000 - $35,000

= $40,000

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In your own words, explain the usefulness of spreadsheet models.
malfutka [58]

Answer:

They're often used at many companies and businesses because instead of other formats it is very conclusive because you can clearly see the differences of all the numbers in it. They're right next to each other and they are easy to add information to. There is no need for any extra information and there is just enough evidence in everything for just the numbers.

7 0
2 years ago
Checks are promises to pay a sum of money at some time in the future. <br> a. True <br> b. False
pishuonlain [190]

the answer to this question is true



7 0
3 years ago
Three examples of solutions to the problems of a monopoly are harnessing the benefits of ________, ________ trade barriers, and
Sever21 [200]

Answer:

1. harnessing the benefits of competition.

2. reducing trade barriers

3. regulating markets.

Explanation:

harnessing the benefit of competition

The use of competition in a  market will enable consumers get the best possible prices, quantity, and quality of goods and services. competition in a market will also boost innovation allowing each firm producing similar goods to improve the quality of their products so as to gain more market share.

Reducing trade barriers

When trade barriers such as quota, embargo, tariffs are reduced in the market, it becomes easier for firms to compete with a other firms. Reduction of trade barriers will encourage more firms to enter a market that previously had a single supplier of a commodity .

Regulating market

A regulated market is a kind of market where government control the force of demand and supply like determining who is allowed to enter the market and determine what price to be charge. Markets that are natural monopolies are usually regulated to avoid exploitation of consumers

5 0
3 years ago
RecRoom Equipment Company received an $13,200, six-month, 7 percent note to settle an $13,200 unpaid balance owed by a customer.
Effectus [21]

Answer:

RecRoom Equipment Company

Date                 Particulars               Debit              Credit

1Nov            Note Receivable      $ 13,200

                          Account Receivable                 $ 13,200

RecRoom Equipment Company received an $13,200, six-month, 7 percent note to settle an $13,200 unpaid balance owed by a customer.

31 December  Interest Receivable        $ 924

                              Interest Revenue                $ 924

To record the accrued interest earned. $13,200*7%= $ 924. As it is for two months the amount would be $ (924/12)*2= $ 154

1 May            Cash                    $ 13,662

                            Interest Income                           $ 462

                               Notes Receivable                  $ 13,200

  RecRoom receives the interest on the note's maturity date. RecRoom receives the principal on the note's maturity date.                                    

5 0
3 years ago
Trahan Lumber Company hired you to help estimate its cost of common equity. You obtained the following data: D1 = $1.25; P0 = $2
kobusy [5.1K]

Answer:

cost of equity raised by selling new common stock = 9.84%

so correct option is c. 9.84%

Explanation:

given data

D1 = $1.25

Po = $27.50

g = 5.00%

F = 6.00%

to find out

cost of equity raised by selling new common stock

solution

we will apply here cost of equity raised by selling new common stock formula that is express as

cost of equity raised  = \frac{D1}{Po-F*Po}  + g   ..................1

put here value we get

cost of equity raised  = \frac{D1}{Po-F*Po}  +g

cost of equity raised  = \frac{1.25}{27.50-0.06*27.50}  + 5%

solve we get

cost of equity raised by selling new common stock = 9.84%

so correct option is c. 9.84%

6 0
3 years ago
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