Answer:
b. Increase by $17,000
Explanation:
For computing the change in the operating income, first we have to determine the cost by make and buy options
Make options:
= Variable cost + fixed cost
= $70 + $60
= $130
Buy options:
= Outside supplier cost + fixed cost × remaining percentage
= $77 + $60 × 60%
= $77 + $36
= $113
So, the difference of cost would be
= $130 - $113
= $17
And, the operating income would be
= Number of units make in each year × cost difference
= 1,000 units × $17
= $17,000
Answer:
Blue Spruce report as its December 31 inventory is $285,000
Explanation:
Correct inventory
= 229,500 + goods purchased FOB shipping point 30,000 + goods sold FOB destination 25,500
= 229,500 + 30,000 + 25,500
= 285,000
Answer:
Balance after 30 years = $151,018.50
Explanation:
In order to calculate this, we will calculate the future value on an amount invested, gaining interest over the years of investment, and this is given by:

where:
FV = future value
PV = present value
r = interest rate
t = time in years.
Hence the future value is calculated as follows:
1. For the first 10 years at 7% interest:
7% interest = 7/100 = 0.07


2. For the last 20 years at 9.5%(0.095) interest:
Note that for the remaining 20 years, the present value (PV) used = 24,589.392, as ending balance after the first 10 years


Total Future value earned = $151,018.50