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serious [3.7K]
3 years ago
10

You are a newspaper publisher. You are in the middle of a one-year rental contract for your factory that requires you to pay $60

0,000 per month, and you have contractual labor obligations of $1,250,000 per month that you can’t get out of. You also have a marginal printing cost of $0.25 per paper as well as a marginal delivery cost of $0.1 per paper. If sales fall by 20 percent from 1,000,000 papers per month to 800,000 papers per month, what happens to the Average Fixed Costs per paper?
Business
1 answer:
Anika [276]3 years ago
4 0

Answer:

If sales fall by 20 percent from 1,000,000 papers per month to 800,000 papers per month, <em>Average Fixed Costs will increase from $1.85 per paper to $2.31 per paper.</em>

Explanation:

The fixed costs  mentioned add up to 600,000 + 1,250,000 = $1,850,000 per month

The other costs mentioned (printing cost and delivery cost) are variable with output (per paper).

As fixed costs are the same regardless of output, falling sales will reduce the quantity on which fixed cost are spread (to calculate fixed cost) and thus make average fixed cost increases.

In this case, it increases from  1,850,000/1,000,000 (= $1.85 per paper) to  1,850,000/800,000 (= $2.31 per paper)

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The resource-based view differs from the institution-based view in that the resource-based view focuses on a firm's _____.
Vladimir79 [104]

The resource-based view differs from the institution-based view in that the resource-based view focuses on a firm's internal strengths and weaknesses.

Resources are all materials available in our environment that are technically accessible, economically feasible, culturally sustainable, and that help meet our needs and desires. point.

Resources are physical materials that people need and value, such as land, air, and water. Resources are characterized as renewable or non-renewable. Renewable resources are automatically renewed as they are consumed, while non-renewable resources have limited availability.

1a: Source or Support: Available Resources - Usually used in the plural. b : natural source of wealth or income - often used in the plural. c : Natural features or phenomena that improve the quality of human life. d : computable wealth - usually used in the plural.

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7 0
1 year ago
Tax planning Question 6 options: guides investment activities to maximize after-tax returns over the long term for an acceptable
krok68 [10]

Answer:

guides investment activities to maximize after-tax returns over the long term for an acceptable level of risk

Explanation:

Given that the purpose of Tax planning is to ensure that there is tax efficiency for the firm, in an after-tax evaluation, the goal of the firm in terms of returns or profits is toll achieved.

Hence, in this case, the correct answer to the question is that TAX PLANNING "guides investment activities to maximize after-tax returns over the long term for an acceptable level of risk."

8 0
3 years ago
Ms. Z has decided to invest $75,000 in state bonds. She could invest in State A bonds paying 5 percent annual interest or in Sta
rodikova [14]

Answer:

Ms. Z should invest in the State A.

Explanation:

Coupons from State A = (1 - 0.33)*0.05*75000

                                      = 2512.5

Coupons from State R = (1 - 0.33 - 0.085)*.054*75000

                                     = 2369.25

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7 0
3 years ago
Campbell Construction Company expects to build three new homes during a specific accounting period. The estimated direct materia
Alina [70]

Answer:

The driver for employees fringe benefits is direct labor costs whereas the driver for indirect material costs is direct material costs

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Find the breakdown of the costs in the attached excel file.

Download xlsx
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3 years ago
Shawnee Hospital installs a new parking lot. The paving cost $30,000 and the lights to illuminate the new parking area cost $15,
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Answer: d. $45,000 should be debited to Land Improvements.

Explanation:

Land improvements records any moderation to land asset that is expected to add to its value and lasts for more than a year.

The paving and lighting of the parking area will add value to the area and will last longer than a year so both should go to the Land improvement account. As this account is an asset account, it will be debited when increased:

= 30,000 + 15,000

= $45,000

6 0
3 years ago
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