The level of quality of information would eventually exist in the market for lemons assuming there was no way to gain assurance regarding the accuracy of the information would be low only.
In the given scenario we are given that there is no way to reassure ourselves that the information is accurate about the lemons in the existing market.
So we can not be a hundred percent sure that the information regarding the lemons existing in the market is correct.
As a result, if there was no method to verify the authenticity of the information, only low-quality information would eventually be available in the market for lemons.
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Answer:
Increase in net Operating income = $14,600
Explanation:
Sales
i. 8000 units X $220
=$1,760,000
ii. 8200 units X $220
=$1,804,000
Variables expenses
i. 8000 units X $66 = $528,000
ii8200 units X $72 = $631,400
Contribution margin
CM=Sales -Variables expenses
i. 1,760,000 - 528,000=
$1,232,000
ii. 1,804,000 - 631,400
=$1,172,000
Our Fixed expenses are
i. $991,000
ii. $917,000
Therefore Net operating income = Contribution margin - Fixed expenses
i. 1,232,000 - 991,000
=$241,000
ii. 1,172,600 - 917,000
=$255,600
From the answers above, there is an increase of $14,600 as a difference between $241,000 and $255,600 which are the Net Operating income.
Answer:
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C is the correct answer
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Johnson Brothers outdoor furniture manufacturing consists of the following departments:
- Cutting department
- Staining and finishing department
- Assembling department
As group activities were perform as per function. This departmentalization is regarded as Functional Departmentalization.