1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Anika [276]
3 years ago
5

Barnes Company reports the following operating results for the month of August: sales $305,000 (units 5,000); variable costs $21

3,000; and fixed costs $71,700. Management is considering the following independent courses of action to increase net income. Compute the net income to be earned under each alternative1. Increase selling price by 10% with no change in total variable costs or sales volume. Net income ş______2. Reduce variable costs to 60% of sales. Net income.______3. Reduce fixed costs by $22,000. Net income s__________Which course of action will produce the highest net income?
Business
1 answer:
Ostrovityanka [42]3 years ago
6 0

Answer:

1. $30,500;

2. $30,000;

3. $22,000;

=> Option 1 produce the highest net income.

Explanation:

We have sell price per unit = 305K /5K = $61

1.  Increase selling price by 10% with no change in total variable costs or sales volume:

Sell price = 61 x 1.1 = $67.1

Sales revenue = 67.1 x 5,000 = $335,500

Increase in sales revenue = 335.5K - 305K = $30,500

As costs remains the same, Net income will increase as much as the increase as sales revenue which is $30,500.

2.  Reduce variable costs to 60% of sales:

New variable cost = $305,000 x 60% = $183,000

Saving in variable cost = 213K - 183K = $30,000

As fixed cost and sales revenue remain the same, net income will increase as much as the saving in variable cost which is $30,000

3. Reduce fixed costs by $22,000:

As variable cost and sales revenue remain the same, net income will increase as much as the saving in fixed cost which is $22,000

You might be interested in
More recent work in the area of strategic management regarding assertions about being stuck in the middle:_________.
ikadub [295]

Answer:

<em>B) contradicts the argument and finds that firms that successfully pursue cost leadership and product differentiation simultaneously can often expect to gain a sustained competitive advantage.</em>

7 0
2 years ago
James Sebenius, in his Harvard Business Review article: Six Habits of Merely Effective Negotiators, identifies six mistakes that
PolarNik [594]

Answer:

c. Neglecting the Other Side’s Problems.

Explanation:

To be an effective negotiator one must understand what his interest is and what he can compromise and the limits to what can be given to the other party (that is no-deal options).

It is even more important to understand the other parties problem. This can be used to guage their interest and how it can be met.

Not considering the counterparty problem is a mistake the negotiating team have made. If the other partie's problem is not understood then there won't be an effective way of negotiating.

3 0
3 years ago
Shale oil mining corporation is a u.s. employer. shale oil and other u.s. employers must perform i-9 verifications for
tigry1 [53]
<span>Shale oil mining corporation is an u.s. employer. shale oil and other u.s. employers must perform i-9 verifications for Each new hire.
</span> I-9<span> is used for </span>verifying<span> the identity and employment authorization of individuals hired for employment in the United State and conducted to make sure that the new employee has the full legal right to work in United States</span>
5 0
3 years ago
Amazon, the largest online retailer, has experimented with physical stores and recently bought Whole Foods. Whole Foods has almo
denpristay [2]

Answer:

to survive today, organizations need to be present in both the online and physical markets

Explanation:

So far Amazon has dominated the online space when it comes to buying products and services. But the scenario in the question makes it clear that having only one channel open to customers (online) is not sufficient.

It is necessary to diversify by having physical stores in addition to online stores.

Some consumers for example will want to examine what they are buying before paying, others will not have the patience to wait for delivery of goods. So the physical store will serve these segments of customer's.

5 0
3 years ago
On December 31, 2019, Spearmint, Inc., issued $450,000 of 9 percent, 3-year bonds for cash of $461,795. After recording the rela
cluponka [151]

Answer:

Interest expense    18,284.17  debit

Premium on BP        1,965.83 debit

        Cash                                 20,250 credit

Explanation:

procceds 461,795

face value 450,000

premium on bonds payable 11,795

As the cash received exceed the face value then, the bonds were isued at premium.

This will be amortized over the bonds life

3-year bonds with semiannual payment: 6 payment in total

amortization per payment:

11,795 / 6 = 1.965,83

The will post:

the cash disbursement in favor of the bondholder:

450,000 x 9%/2 =  20,250

amortization             (1,965.83)

interest expense:    18.284,17‬

3 0
3 years ago
Read 2 more answers
Other questions:
  • What is fifty minuse 1
    6·2 answers
  • Point technologies and its distributor in singapore signed an international distribution agreement. in the event of a​ dispute,
    10·1 answer
  • Balt Company maintains a standard cost system; as such, all inventories, including materials, are carried on the books at standa
    6·1 answer
  • I need help on Personal Finance.
    14·1 answer
  • JudyJudy hires students at ​$5050 a day to mow lawnsmow lawns. SheShe leases equipment that costs ​$8080 a day. Suppose that Jud
    14·1 answer
  • The price of imported oil rises. If the government wanted to stabilize output, which of the following could it do?
    9·2 answers
  • Ntex Ltd. issued 10,000, 10% Debentures of Rs.100 each at a premium of
    9·1 answer
  • The Fabricating Department started the current month with a beginning Work in Process inventory of $10,000. During the month, it
    12·1 answer
  • Controllable margin is defined as A.sales minus variable costs. B.sales minus contribution margin. C.contribution margin less co
    13·1 answer
  • Gloria works as a freelance software developer with Ticki-Tacker Limited, a social media firm based in the city of London. She h
    9·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!