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Sati [7]
3 years ago
6

Bloom Company management predicts that it will incur fixed costs of $259,000 and earn pretax income of $493,100 in the next peri

od. Its expected contribution margin ratio is 69%.
Required:1. Compute the amount of total dollar sales.2. Compute the amount of total variable costs.
Business
1 answer:
marissa [1.9K]3 years ago
6 0

Answer:

Instructions are below.

Explanation:

Giving the following information:

Fixed costs= $259,000

Pretax income= $493,100

Contribution margin ratio= 0.69

<u>The contribution margin ratio is the percentage of sales remaining after deducting all variable components.</u>

First, we need to calculate the total contribution margin:

Total contribution margin= pretax income + fixed costs

Total contribution margin= 493,100 + 259,000= $752,100

Now, total sales:

Total sales= total contribution margin/contribution margin ratio

Total sales= 752,100/0.69= $1,090,000

Finally, total variable costs:

Total variable costs= total sales - total contribution margin

Total variable costs= 1,090,000 - 752,100= $337,900

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Assume that you are interested in earning some return on the idle balances you usually keep in your checking account and decide
professor190 [17]

Answer:

By writing that check and investing in mutual funds, M1 will decrease, but M2 will remain the same.

Explanation:

M1 includes currency and coin, demand deposits, travelers' checks, check accounts, and negotiable order of withdrawal (NOW) accounts.

M2 includes all M1 + savings deposits, money market securities, mutual funds, and other time deposits.

6 0
3 years ago
At the end of 2013, its first year of operations, Slater Company reported a book value for its dependable assets of $40,000 for
Irina-Kira [14]

<u>Solution and Explanation:</u>

SC's Depreciable assets for the purpose of financial reporting and income taxes were $40000 and $33000 respectively. Its taxable income is$97000.Temporary difference will be there because of Depreciation.

Temporary Difference=Financial reporting Dep-Income tax depreciation

=40000 minus 33000

=7000

Pretax financial income=taxable income+Temporary Difference  

=97000+7000=$104000

Deferred tax liability=7000 multiply 30%=2100

Income tax expense=104000 multiply 30%=31200

Income tax payable=97000 multiply 30%=29100

Dec 31 Income Tax ExpensenA/C Dr. $31200

                     To Income Tax Payable A/C $ 29100

                       To Deferred Tax Liability A/C $ 2100

<u> Answer:b </u>

Slatter Company

Partial Balance Sheet

December 31, 2013

Noncurrent Liabilities

Deferred Tax Liability $2100

5 0
3 years ago
MC Qu. 22 Selected information from the accounting... Selected information from the accounting records of Dunn's Auto Dealers is
dlinn [17]

Answer:

($23,000)

Explanation:

Cash flow from Investing Activities

Purchase of furniture                                       ($ 8,000)

Proceeds from sale of Equipment                    $5,000

Investment in other companies                     ($20,000)

Net Cash used by  Investing Activities          ($23,000)

Notes :

Cash flow from Investing activities section of the cash flows statement shows the cash movement in acquisition of assets and sale of assets.

4 0
3 years ago
Which of the following statements regarding perpetuities is​ FALSE? A. A perpetuity is a stream of equal cash flows that occurs
Xelga [282]

Answer:

The answer is: C) PV of a perpetuity​ = StartFraction r Over Upper C EndFraction (I guess this means PV = r / C, which is FALSE)

Explanation:

The formula for calculating the present value of a perpetuity is:

                        PV = C / r

Where PV = Present Value, C = cash flow, r = discount rate.

A perpetuity is a stream of equal cash flows that lasts forever (perpetually).

The formula for calculating the present value of a perpetuity is simple, so there is no reason to spend time calculating the present value of each cash flow, since there are infinite cash flows.

A consol bond s a type of perpetuity issued by the British government (also by the US government)

7 0
3 years ago
Star Studios is looking to purchase a new building for its upcoming film productions. The company finds a suitable location that
andriy [413]

Answer:

Present value for option 1 = $1,460,000

Present value for option 2 = $1,460,971.84

Present value for option 3 = = $1,324,815.67

Present value for option 4 = $1,614,077.65

Explanation:

Present value is the sum of discounted cash flows.

Present value can be calculated using a financial calculator.

For the first option, the present value is $1,460,000.

For the second option:

Cash flow in year zero = $460,000

Cash flow each year from year one to ten =

 $136,000

I = 6%

Present value = $1,460,971.84

For the third option:

Cash flow each year from year 1 to 10 = $180,000

I = 6%

Present value = $1,324,815.67

For the fourth option:

Cash flow each year from year 1 to 4 = 0

Cash flow in year 5 = $2,160,000

I = 6%

Present value = $1,614,077.65

To find the PV using a financial calacutor:

1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.

2. After inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.

3. Press compute

I hope my answer helps you

8 0
3 years ago
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