Locations of Transfer-Oriented Firms Assume the distance between the resource (R ) and the market (M) is 10 miles. A firm’s proc
1 answer:
Answer:
Move Oriented Firms are where transport cost is the prevailing component for area choice. Transport cost contains Procurement Cost (PC) and Distribution Cost (DC).
(a) Total cargo cost will be the whole of PC in addition to DC.
Complete Freight Cost =
Complete Freight Cost =
In the event that we take a gander at the expense limiting alternative in the above table for the firm then it ought to situate at zero separation where the expense is least at 100. Absolute cost will increment as the estimation of x increments.
(b) If peripheral obtainment cost is zero for all the separation alternatives (1 to 10) at that point it shows that PC stays zero independent of the separation between Resource (R) and Market (M). The all out cost will be:
TC = PC + DC
TC =
TC =
The table will be as underneath:
The firm would situate at separation of 10 miles where the absolute expense is least at 50.
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Answer:
Please check the attached image for the depreciation schedule
2. Units of production method
Explanation:
Book value in year 1 = Cost of asset - Depreciation expense of year 1
Book value in year in subsequent years = previous book value - that year's depreciation expense
Accumulated depreciation is sum of deprecation expense
Straight line depreciation expense = (Cost of asset - Salvage value) / useful life
($18,000 - $3,000) / 4 = $3,750
Depreciation expense each year of the useful life is $3,750
Depreciation expense using the double declining method = Depreciation factor x cost of the asset
Deprecation factor = 2 x (1/useful life) = 0.5
Depreciation expense in year 1 = 0.5 x $18,000 = $9,000
Book value = $18,000 - $9,000 = $9,000
Depreciation expense in year 2 = 0.5 × $9,000 = $4,500
Book value = $9,000 - $4,500 = $4,500
Depreciation expense in year 3 = 0.5 x $4,500 = $2250
Book value = $4,500 - $2250 = $2250
Depreciation expense in year 4 = 0.5 × $2250 = $1125
Depreciation expense using the unit of production method =( Total production in the year/ total productive capacity) × (cost of asset - Salvage value)
Depreciation expense in year 1 = ($18,000 - $3,000) x (300 / 3000) = $1,500
Depreciation expense in year 2 =18,000 - $3,000) x (900 / 3000) = $4,500
Depreciation expense in year 3 = (18,000 - $3,000) x (1200 / 3000) = $6,000
Depreciation expense in year 3 = (18,000 - $3,000) x (600 / 3000) = $3,000
The Units of production method tracks wear and tear accurately because deprecation depends on the production each year.
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