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Eduardwww [97]
3 years ago
10

JoPacks sold 500 backpacks in September. Total variable costs were $7,500, total fixed costs were $10,000, and profit was $4,000

. If JP sold 1,000 backpacks, what would their profit be
Business
1 answer:
aivan3 [116]3 years ago
6 0

Answer:

$18,000

Explanation:

Total revenue - total cost = profit

total cost = variable cost + fixed cost

when 500 units were sold

total revenue - ( $10,000 + $7,500) = $4,000.

revenue = $21,500

to determine profit when 1000 units are sold, we have to determine the price and average variable cost

Price = revenue / total unit sold = $21,500 / 500 = $43

Average variable cost = $7,500 / 500 = $15

For 1000 units sold

revenue = price x units sold = 1000 x $43 = $43,000

total variable cost = $15 x 1000 = $15,000

total cost = $15,000 + $10,000 = $25,000

Profit =  $43,000 - $25,000 = $18,000

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A notice is published stating that RMO 5% convertible preferred stock will be called at $60 per share. The preferred is converti
dybincka [34]

Answer: d. A price near $60

Explanation:

The Preferred Stock was selling at $56 then a notice was circulated that RMO would be calling the stock at a price of $60.

This $60 is more than the current $56 and so this will need to reflect in the price of the stock. The adjustment will cause the Preferred stock to start trading near $60 as traders will seek to take advantage of the impending call by buying at a lower price and thus making a bit of profit when the stock is called at $60. The market will adjust to this because the Preferred stock will be perceived as undervalued. A price closer to the Call price will therefore become the new price to properly value the stock.

6 0
3 years ago
Match the terms below with the following definition:
GalinKa [24]

Answer:

1. B

2. A

3. D

4. C

Explanation:

1. Activity variance

B) the difference between a revenue or cost item in the flexible budget and the same item in the planning budget.

The activity variance is as a result of difference between the actual level of activity in the flexible budget to the assumed level of activity in the planning budget.

2. Planning budget

A) a budget created at the beginning of the budgeting period that is valid only for the planned level of activity.

Planning budget is a process of evaluating earnings and expenses and project their monetary intakes and outtakes for the future made by  an individual or company.

3. Flexible Budget

D) a report showing estimates of what revenues and costs should have been, given the actual level of activity for the period.

Flexible budget adjusts with changes in volume and activity

4. Spending variance

C) the difference between the actual amount of the cost and how much the cost should have been, given the actual level of activity

This is unfavorable if the actual cost is greater than what the cost should have been and favorable if the actual cost is less than what the cost should have been.

6 0
3 years ago
Cardinal Industries purchased a generator that cost $11,000. It has an estimated life of five years and a residual value of $1,0
Nadya [2.5K]

Answer:

$2080

Explanation:

Given: Cost of generator= $11000.

           Residual value= $1000.

            Estimated life of generator= 5000 hours.

            Actual activity performed during the period= 1040 hours.

Now, finding the depreciation expense for the first year using the units-of-activity method.

Formula; Depreciation\ expense= \frac{(cost- residual\ value)}{Total\ estimated\ life\ time\ activity} \times actual\ activity\ performed

⇒ Depreciation expense= \frac{(11000-1000)}{5000} \times 1040

Opening parenthesis

⇒  Depreciation expense= \frac{10000}{5000} \times 1040

⇒  Depreciation expense=  2 \times 1040 = \$ 2080

Hence, the depreciation expense for the first year using the units-of-activity method of depreciation is $2080.

3 0
3 years ago
Hibiscus Co has a debt-equity ratio of 0.80. The firm is analyzing a new project which requires an initial cash outlay of $300,0
morpeh [17]

Answer:

$321,600

Explanation:

debt equity ratio = debt / equity

since the debt to equity is 0.8, that means that for every $ invested from equity, $0.80 will be borrowed. If the new project requires an initial cash outlay of $300,000:

  • then $300,000 / $1.80 = $166,667 will be new equity
  • and $133,333 will be new debt

total cost of initial outlay including flotation costs = ($166,667 x 1.09) + ($133,333 x 1.0495) = $181,667 +  $139,933 = $321,600

flotation costs include all the costs associated with issuing new stocks or taking new debt.

8 0
3 years ago
H&R is a small, local heating and air conditioning business. The local military base is a potential source of growth, and H&
Lapatulllka [165]

Answer:

Market development

Explanation:

Market development can be defined as a growth strategy in which an organisation decides to sell off their existing goods to a new set of potential buyers. Market development helps to improve the capability of the market by moving into different unexplored part of the market.

The first step of market development is the creation of a good promotion approach. Organizations have to look for different advertising strategies which will be used to introduce their products into the new market so as to achieve rapid sales of the product.

H&R is considering a market development growth strategy so as to tap into new market segments.

6 0
3 years ago
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