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Dvinal [7]
2 years ago
7

L Corporation produces and sells 15,300 units of Product X each month. The selling price of Product X is $23 per unit, and varia

ble expenses are $17 per unit. A study has been made concerning whether Product X should be discontinued. The study shows that $74,000 of the $103,000 in monthly fixed expenses charged to Product X would not be avoidable even if the product was discontinued. If Product X is discontinued, the annual financial advantage (disadvantage) for the company of eliminating this product should be:
Business
1 answer:
Arlecino [84]2 years ago
5 0

Answer:

<em><u>It would generate a financial disadvantage for 62,800</u></em>

Explanation:

\left[\begin{array}{cccc}-&continued&discontinued&differential\\Sales&351,900&0&-351,900\\Variable&-260,100&0&260,100\\Contribution&91,800&0&-91,800\\Fixed&-103,000&-74,000&29,000\\total&-11,200&-74,000&-62,800\\\end{array}\right]

It would generate a financial disadvantage for 62,800

Because the product, while is having a loss, their contribution cover is enought to cover at least the avoidable fixed cost.

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The fish in the river are consideredrival in consumption andexcludable whereas the fish in the private pond are and . In other w
Paladinen [302]

Answer:

... whereas the fish in the private pond are <u>rival in consumption</u> and excludable.  

... the fish in the river are an example of <u>common resource</u>, and the fish in the private pond are an example of <u>private good.</u>

<em>* the first sentence is wrong, the fish in the river are nonexcludable since anyone can fish on the river, or at least try to.</em>

Explanation:

If a good is rival in consumption, it means that if one person consumes it, it will lower the ability of another person to consume the good.

If a good is excludable, ten it can only be consumed by those that are willing and able to pay for it.

When a good is both nonexcludable and rival in consumption, it s a common resource.

A private good is both rival in consumption and excludable

5 0
3 years ago
First National Bank charges 13.7 percent compounded monthly on its business loans. First United Bank charges 14 percent compound
Liula [17]

Answer:

First National Bank    = 14.6%

First United Bank.=   = 14.8%

Explanation:

<em>Effective annual rate is the equivalent annual rate o where interest rate is compounded at an interval shorter than a year.</em>

It can be calculated as follows:

EAR = ( (1+r)^(n) -1) × 100

r -interest rate per period

n- number of period

EAR - Effective annual rate

First National Bank

r - interest rate per month = 13.7%/12 = 1.141%

number of period = 12 months

EAR =( (1+011141)^(12) - 1) × 100

       =  0.145938395 × 100

       = 14.59

      = 14.6%

First United Bank.

r- interest rate per quarter - 14%/4 = 3.5% per quarter

n- number of quarters = 4

EAR = ((1+0.035)^(4)- 1) × 100

      = 0.147523001 × 100

      = 14.8%

 

8 0
3 years ago
Walman Corp. manufactures products X, Y, and Z from a joint production process. Joint costs are allocated to products on the bas
rewona [7]

Answer:

We will only produce further product Y and Z

Explanation:

We should check the increase in sales revenue with the increase in cost to know if further process acheive a gain:

<u>Product X</u>

Increase in sales value:

348,000 - 340,000 =  8,000

Additional Cost:     <u>   (38,000)  </u>

difference:                 (30,000) Non-profitable

<u>Product Y</u>

Increase in sales revenue:

185,000 - 150,000 =  35,000

additional cost:      <u>   (30,000)  </u>

difference:                   5,000 Profitable

<u>Product Z</u>

Increase in sales revenue:

147,000 - 110,000 =   37,000

additional cost:    <u>    (22,000)   </u>

difference:                 15,000 Profitable

3 0
3 years ago
Mike and Lon came to a party together. A friend offered Mike a ride home. However, there was no room in the car for Lon. What ar
Vikentia [17]
Mike could leave lon behind, walk lon home, offer to pay for a taxi or finally he could stay with him.

3 0
2 years ago
Vaughn Manufacturing has 11500 shares of 5%, $100 par value, non-cumulative preferred stock and 46000 shares of $1 par value com
Oksana_A [137]

Answer:

$23,000

Explanation:

Total dividends = $138,000 (Paid in 2020)

Common stock outstanding = 46,000 shares

Preferred dividend = Number of shares × Par value × 5%

= 11,500 × $100 × 5%

= $57,500

Dividends received by common stock holders in 2020 is;

= Total dividends - Preferred dividend

= ($138,000 × 1) - ($57,500 × 2)

= $138,000 - $115,000

= $23,000

5 0
2 years ago
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