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lana [24]
3 years ago
13

Look at Exercise 19.2. Compute the opportunity costs of producing sweaters and wine in both France and Tunisia. Who has the lowe

st opportunity cost of producing sweaters and who has the lowest opportunity cost of producing wine? Explain what it means to have a lower opportunity cost.
Business
1 answer:
monitta3 years ago
7 0

Answer:

Answer Illustration : Opportunity Cost of producing Wine is lesser in France, Opportunity Cost of producing Sweaters is lesser in Tunisia. So, France has comparative advantage in Wine, Tunisia in Sweater.

Explanation:

Opportunity Cost is the cost of next best alternative foregone while choosing an alternative.

Opportunity Cost of producing Sweaters & Wine in France & Tunisia are quantities of other goods (Sweaters or Tunias) sacrifised while choosing either. Sweater Opportunity Cost - Wines sacrifised, Wine Opportunity Cost - Sweaters sacrifised.

The country has a comparative advantage in a good if it can produce it with relatively less opportunity cost (in terms of other good sacrifised) than other country.

Ex : Production Possibilities

                   Wine            Sweater    Trade off (Wine :Sweater)

France          10                   5              1:0.5  or 2:1

Tunisia          8                   24              1:3  or 0.33:1

  • France produces Wine with lesser opportunity cost (sweater sacrifised) than Tunisia  [0.5 sweater < 3 sweaters] ; it has comparative advantage in Wine.
  • Tunisia produces Sweater with less opportunity cost (wine sacrifised) than France [ 0.33 wine <  2 wines] ; it has comparative advantage in Tunisia
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Ira Lisetskai [31]

Answer:

The answers are,

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Entity Assumption

The cost to provide information should be weighed against the benefit that users will gain from having the information available.

Cost constraint

A company's use of the same accounting principles from year to year.

Consistency

Assets are recorded and reported at original purchase price.

Historical Cost

Accounting information should help users predict future events, and should confirm or correct prior expectations.

Relevance

The life of a business can be divided into artificial segments of time.

Periodicity assumption

The reporting of all information that would make a difference to financial statement users.

Full Disclosure principle

The judgment concerning whether an item's size makes it likely to influence a decision-maker.

Materiality

10. Assumes a business will remain in operation for the foreseeable future.

Going concern

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Explanation:

7 0
3 years ago
Collingsworth, Inc. produces 3 products: AKM, BWT, and CPQ. Product AKM requires 700 purchase orders, Product BWT requires 1,080
marusya05 [52]

Answer:

Allocated MOH= $100,800

Explanation:

<u>First, we need to calculate the predetermined allocation rate for ordering and receiving:</u>

<u></u>

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Ordering and receiving= 504,000 / (700 + 1,080 + 1,720)

Ordering and receiving= $144 per order

<u>Now, we allocate to product AKM:</u>

Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base

Allocated MOH= 144*700

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5 0
2 years ago
A company inserts winning prize tickets into 10,000,000 of its products. 1 of the tickets is a large cash prize, 1,600,000 are s
netineya [11]

Answer: Large Cash Prize is A. 0000001

Small Cash Prizes is B. 0.16

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Explanation:

Large Cash Price

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= 1/10,000,000

= 0.0000001 which is option A

Small Cash Prices

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= 1,600,000/10,000,000

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kiruha [24]

Answer:

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