Answer:
Net Contribution of the Department $
Contribution margin 24,000
Less: Avoidable fixed cost 55,000
Net contribution (31,000)
The department should be eliminated. The financial advantage of eliminating the department is that it will increase the total profit of the whole company by $31,000
Explanation:
This question relates to deleting a product or segment. The net contribution will be computed by deducting the avoidable fixed cost from the contribution margin. The avoidable fixed cost is total fixed cot minus unavoidable fixed cost. Since the net contribution is negative, it implies that the department should be eliminated.
Answer:
A. attracted both trade and foreign direct investment.
Explanation:
Restrictive trade practices refer to every deliberate and conscious effort made by the government of a country to hinder the free flow of trade across international boarder. Trade restrictions can be in form of high tariff on import, import quota, outright embargo, e.t.c
The reduction or elimination of barrier to free trade is trade liberalization. It is also seen as free market reform as the market forces or price systems are allowed to allocate resources.
Where a country embraces free market reform, it opens her doors to inflow of trade and foreign direct investment popularly known as FDI.
Well if you want to know that you have to do this:
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Margin per chair = $80
Machine hours to produce 1 chair = 2 hours
Multiply: 80 x 2 = 160
Deluxe Chair: 160
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Margin per chair = $90
Machine hours to produce 1 chair = 4 hours
Multiply: 90 x 4 = 320
Executive Chair: 320
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Contribution Margin: $90 and $80
Add: 90 + 80 = 170
Contribution Margin: $170
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Machine Hours: 2 and 4
Add: 2 + 4 = 6
Machine Hours: 6 hours
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So, their is $170 contribution margin per 6 hours.
Hope this helps XD
Answer and Explanation:
(a)
Dr Land ($176 X $20,000) $3,520,000
Cr Treasury Stock ($153 X $20,000) $3,060,000
Cr Paid-in Capital from Treasury Stock $460,000
b)
Cost of treasury stock might be used although , this is not a relevant measure of this economic event but it is a measure of a prior, unrelated event. Therefore the appraised value of the land is a reasonable alternative if based on appropriate fair value estimation techniques. However, it is an appraisal as opposed to a market-determined price. The trading price of the stock is probably the best measure of fair value in this type of transaction.
The trial balance would disagree. It seems that the cash should be credited instead as the situation seems to me that the cash is being expended to pay for the equipment, and the remaining 3500 is liabilities. Therefore, the error should be corrected.
