Answer:
A) decrease the degree of operating leverage
Explanation:
The contribution margin is
sales - variable:
(sales + 2) - (variable + 2) = sales - variable
no change
so B is FALSE
as the contribution margin ratio is:
(sales - variable ) / sales
this increase will impact the contribution margin ratio.
(sales + 2 - (variable +2))/ (sales + 2)
(sales - variable) / (sales + 2)
the CMR will decrease.
so D is FALSE
the break-even on sales will increase as the CMR decreases
more units are needed to fullfil the fixed cost
so C is FALSE
A) decrease the degree of operating leverage
ΔEBIT / Δrevenue
sales increase and the variable cost increases
a change in the sales revenue will not be as efficient as it was before the degree of leverage will decrease.
Answer:
Section 16(b) of the 1934 Securities Exchange Act provides for recapture by the corporation of all profits realized by an insider from the purchase or sale of corporate stock within a 6 month period.
Explanation:
This section of the 1934 Securities Exchange Act was put in place to uphold fairness and equity in the financial markets. Without its provision, insiders could advantage of privileged information and exploit it for personal gain.
Answer:
1. 166,000
2. 188,000
Explanation:
The budgeted accounts receivable balance on September 30 and Budgeted cash receipts for october n be calculated as follows
July
Opening -
Credit sales 240,000
Collection
20% of July 48,000
Closing 192,000
August
Opening 192,000
Credit sales 220,000
Total 412,000
Collection
20% of August 44,000
70% of July 168,000
Total receipts 208,000
Closing 200,000
September
Opening 200,000
Credit sales 180,000
Total 380,000
Collection
20% of september 36,000
70% of august 154,000
10% of july 24,000
Total receipts 214,000
Closing 166,000
October
Opening 166,000
Credit sales 200,000
Total 366,000
Collection
20% of October 40,000
70% of september 126,000
10% of august 22,000
Total receipt 188,000
Closing 178,000
Explanation:
Net purchases= Gross purchases- Returned inventory- Discount on purchases
= $10,300- $800- $360= $9,140
Ending inventory= Beginning inventory+ Net purchases- Cost of goods sold
Cost of goods sold= Beginning inventory+ Net purchases- Ending inventory
= $46,000+ $9,140- $34,500= $20,640
The answer to this question should be True!!!!!!!!
