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Ilia_Sergeevich [38]
3 years ago
8

Lisa’s Custom Print Services produces and sells custom seashore prints. The manager reported $5,400 in fixed expenses, operating

income of $0 at the breakeven point, and a contribution margin per unit of $50. What is the firm’s breakeven point in units using the shortcut approach?
Business
1 answer:
VMariaS [17]3 years ago
8 0

Answer:

108 units

Explanation:

break even point in units = total fixed costs / contribution margin per unit = $5,400 / $50 = 108 units

There are three methods to obtaining a break even point and they all should result in the same answer: equation method, the formula method (or shortcut), and in dollar sales and sales units.

The formula method is also called the shortcut because it's the simplest way.

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6 0
3 years ago
Assume that the risk-free rate of interest is 3% and the expected rate of return on the market is 15%. I am buying a firm with a
kondor19780726 [428]

Answer:

The correct solution is "$6,564.01". A further solution is given below.

Explanation:

The given values are:

beta,

= 1.6

market return,

= 15%

cash flow,

= $2,000

risk free rate of interest,

= 3%

Now,

The stock return will be:

= 3+ 1.6\times (15-3)

= 3+ 1.6\times 12

= 22.2 \ percent

The actual worth of the firm will be:

= \frac{cash \ flow}{rate \ of \ return}

= \frac{2000}{22.2 \ percent}

= \frac{2000}{0.222}

= 9,009

With 0.8 beta, the stock return will be:

= 3+ 0.8\times (15-3)

= 3+ 0.8\times 12

= 12.6 \ percent

So that I'm paying for the firm,

= \frac{2000}{12.6 \ percent}

= \frac{2000}{0.126}

= 15,573.01 ($)

Hence,

I'm paying,

= 15,573.01-9,009

= 6,564.01 ($)

6 0
3 years ago
Which of the following is taken into account when measuring the performance of a nation's economy? (Select all that apply.)
tresset_1 [31]
GDP I think is the correct answer
4 0
3 years ago
The Appraisal Department of Swifty Bank performs appraisals of business properties for loans being considered by the bank and ap
-BARSIC- [3]

Answer:

(a) In case when Appraisal Department has excess capacity then minimum transfer will be:

($130.21 - $7.82) = $122.39

Minimum Transfer Price = $122.39

(b) In case when Appraisal Department has no excess capacity then minimum transfer price will be:

($130.21 - $7.82) + ($163 - $130.21) = $155.18

Minimum Transfer Price = $155.18

(c) No, the management should not force to charge the Home- Loan department only $150.42.

3 0
3 years ago
A company needs 10,000 units of a component used in producing one of its products. The latest internal accounting reports show t
jok3333 [9.3K]

Answer:

A) The outsourcing costs $18 more per unit. It increases the cost by $18000

B) Price= $126

Explanation:

Giving the following information:

Q= 10000 units

In-house:

Variable manufacturing cost= $110 unit

Fixed cost= $40 unit

Total cost= $150 unit

Outsource:

Price=$144 unit

Fixed cost= $40*0,60= $24

Total cost= $168

A) The outsourcing costs $18 more per unit. It increases the cost by $18000

B) The price that makes the decision indifferent is the one that equals unitary costs. We can't reduce fixed costs.

Price=144-18= $126

7 0
4 years ago
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