Answer: Karl must sell 1350 small heaters and 450 large heaters to break even.
We follow these steps to arrive at the answer:
No. Small Large Total
1 Selling Price per unit 80 250
2 Variable Cost per unit 30 120
3 Number of units sold 2100 700 2800
4 Sales mix 3 1
5 Total sales (1*3) 168000 175000
6 Total Variable Cost (2*3) 63000 84000
7 Contribution Margin (5-6) 105000 91000 196000
Next we compute the Weighted Average Contribution Margin as follows:
Now, Break even point (BEP) is computed as
Since the large and small heaters are sold in the 3:1 ratio, we can find the number of large and small heaters to be sold in order to achieve the break even point at 1800 units.
Answer: $246,000
Explanation:
Merchandise costing $20,000 had been omitted from the Ending Inventory.
Ending inventory is deducted from Cost of Goods sold which means that the Cost of Goods sold was overstated by $20,000.
Cost of Goods sold are subtracted from sales to find Gross Income so if it was overstated then Income was understated by $20,000.
Accrued Revenue is to be added to Income so if it was omitted then income was understated by $50,000.
Income in total was therefore understated by = 20,000 + 50,000
= $70,000
The correcting entry is net of tax so;
= 70,000 * ( 1 - 20%)
= $56,000
Retained earnings will therefore be;
= 190,000 + 56,000
= $246,000
Answer: Examing demand for the products.
Gauge customer satisfaction.
Explanation: we dont have to sell products we like or want to sell, but products people demand. First we have to do is knowing consumers and what do they want. And keep our customers highly satisfied.
Answer:
3
Explanation:
Based on your answer to questions 1 and 2, set three goals: one short-term, one mid-term, and one long-term.
- The greater the elasticity of supply, the grater the gains from trade.
<u>TRUE. </u>
This situation is true because in an elastic supply situation there is a decrease in prices and an increase in demand, so total surpluses increase and generate more gains to trade.
- If supply is perfectly inelastic, the fall in consumer surplus would exceed the rise in producer surplus.
<u>FALSE</u>
It is false because In a perfectly inelastic supply situation, the quantity of demand does not change even if prices change.
- Producers can still benefit from trade even if supply is perfectly inelastic.
<u>FALSE</u>
It is false because in a perfectly inelastic supply situation the beneficiary will be the consumer, as prices will not change and consumer surplus will increase.
