Answer:
The answer is: If the new market proves to be big enough for Diacon Products (DP) to enter, they can always build a new facility for themselves.
Explanation:
Unless prohibited in the contract, DP will always be able to build new factories or facilities in the new markets they just entered. Their better know how on the production processes will always be an advantage for them.
For instance they might build a new cement factory in India. If India´s market for cement turns to be huge and DP decides to enter into it, of course they should be able to build a new cement plant for themselves. They will probably be able to set up the cement plant in a better way than before due to the experience they gained the first time.
Usually the worst thing to do is simply nothing. If they believe a market is so good for them to enter, then they should do it directly the first time. But if they are unsure, building a turnkey project for someone else is very good marketing research.
Answer:
rate of return 9.22%
Explanation:
15% return on fund value - 2.4% fund expenses = 12.6% net fund gain
then, the shares were purchased with a loan which required to paiy 3% of interest up-front
therefore, we didn't invest 100% of the loan but 97%
0.97 x .126 = 0,12222
now, we subtract the 3% paid of interest:
.1222-0.03 = .0922 = 9.22%
Answer:
$1,985,976.79
Explanation:
The formula for finding the amount is :
A = FV/ annuity factor
Annuity factor = {[(1+r)^n] - 1} / r
FV = Future value = $24,800,000
A = Amount
R = interest rate = 8%
N = number of years = 9
Annuity factor = (1.08^9 - 1 ) / 0.08 = 12.487558
$24,800,000 / 12.487558 = $1,985,976.79
Answer:
1.267 = Overhead Rate
Explanation:
<em>As general approach,</em> the manufacturing rate, along with any rate is done by dividing the cost by a cost driver.
![\frac{Cost\:Of\: Manufacturing\: Overhead}{Cost\: Driver}= $Overhead \:Rate](https://tex.z-dn.net/?f=%5Cfrac%7BCost%5C%3AOf%5C%3A%20Manufacturing%5C%3A%20Overhead%7D%7BCost%5C%3A%20Driver%7D%3D%20%24Overhead%20%5C%3ARate)
In this case teh cost is the manufacturing overhead and the cost driver the direct materials cost:
![\frac{1,270,000}{1,010,000}= $Overhead Rate](https://tex.z-dn.net/?f=%5Cfrac%7B1%2C270%2C000%7D%7B1%2C010%2C000%7D%3D%20%24Overhead%20Rate)
<em>Using Direct Materials cost, the rate would be:</em>
![1.257425743= $Overhead Rate](https://tex.z-dn.net/?f=1.257425743%3D%20%24Overhead%20Rate)