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Stells [14]
3 years ago
8

Jacques lives in San Diego and runs a business that sells boats. In an average year, he receives $728,000 from selling boats. Of

this sales revenue, he must pay the manufacturer a wholesale cost of $428,000; he also pays wages and utility bills totaling $262,000. He owns his showroom; if he chooses to rent it out, he will receive $18,000 in rent per year. Assume that the value of this showroom does not depreciate over the year. Also, if Jacques does not operate this boat business, he can work as a paralegal and receive an annual salary of $21,000 with no additional monetary costs. No other costs are incurred in running this boat business.
Required:
(a) Identify each of Jacques costs in the following table as either an implicit cost or an explicit cost of selling boats.
1. The rental income Jacques could receive if he chose to rent out his showroom..................?
2. The wages and utility bills that Jacques pays ...................?
3. The salary Jacques could earn if he worked as an accountant ..........................?
4. The wholesale cost for the boats that Jacques pays the manufacturer....................?
Business
1 answer:
Gwar [14]3 years ago
6 0

Answer:

1. <u>implicit cost</u>

2.<u> explicit cost</u>

3. <u>implicit cost</u>

4. <u>explicit cost</u>

Explanation:

Implicit costs refer to those costs that represent opportunity cost. In simple terms they are notional or those which haven't been actually incurred but considered.

Opportunity costs refer to the cost of sacrificed alternatives when an alternative is opted for. For instance, a student pursuing post graduation incurs implicit cost in the form of income foregone had he chosen to work instead for the same duration.

In the given case, the foregone rental income Jacques would've earned had he chosen to rent out his showroom represents opportunity cost or implicit cost.

Similarly, the salary Jacques sacrificed by working in boat business represents implicit cost.

The wages and utility bills that Jacques pays and wholesale cost which he pays represent costs which have actually been incurred, which are termed as explicit costs.

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A business segment reports segment revenues of $1.2 million, segment costs of $1.0 million, and allocated corporate overhead cos
topjm [15]

Answer:

d. decrease by $200.000.

Explanation:

The computation of the segment profit is shown below:

Segment profit = Segment revenues - Segment cost

                         = $1.2 million - $1.0 million

                         = $0.2 million or $200,000

Since the management want to drop the segment which results to decrease in the overall corporate profits that means the segment profit will also got decreased by  $200,000

The overhead cost is not relevant. Hence, ignored it

6 0
3 years ago
When price decreases, quantity increases. Price elasticity of demand measures how much ________.a. The price decreasesb. The pri
erastova [34]

Answer:  

Price elasticity of demand measures how much the quantity increases when price decreases.

Explanation:

Price elasticity is the percentage change in the quantity demanded, divided by the percentage change in the price.

If the percentage in the change in the quantity demanded is bigger than the percentage in the change of the price we talk about elastic demand.

If the percentage in the change in the quantity demanded is smaller than the percentage in the change of the price we talk about inelastic demand.

And if he percentage in the change in the quantity demanded is excatly the same than the percentage in the change of the price we talk about unit elastic demand.

6 0
3 years ago
Chess Top uses the periodic inventory system. For the current month, the beginning inventory consisted of 480 units that cost $6
Whitepunk [10]

Answer:

The cost of ending inventory is $24314.

Explanation:

Under the average cost method, the inventory is valued at the average cost of all the inventory that is available from the start of the month and the purchases made.

The average cost of inventory can be calculated by summing up the total cost of beginning inventory and purchases and dividing it by the total number of units available for sale.

Average cost per unit = [ 480*65 + 720*68 + 360*70 ] / [480 + 720 + 360]

Average cost per unit = 67.538 rounded off to $67.54 per unit

The total inventory available for sale = 480+720+360 = 1560 units

The ending inventory in units = 1560 - 1200 = 360 units

The cost of ending inventory = 360 * 67.54 = $24314.4 rounded off to $24314

5 0
3 years ago
Topic : Payroll ​<br><br>Please answer as soon as possible.
sashaice [31]

Answer:

1. Vera = $400

2. Colin = $780

3. Messy = $54

4. Goyoh = $5,600

Explanation:

<em>Requirement 1 & 2</em>

<em>1. Vera Dunhill's gross salary - </em>

Hourly income = $10

As she has worked 40 hours for the current week, the gross salary is as follows -

Weekly Income (Gross Salary) = Number of hours worked × Hourly Income

Weekly Income (Gross Salary) = 40 hours × $10 = $400.

<em>2. Colin George's Gross Salary -</em>

Hourly Income = $15

Overtime hourly rate = $15 × 1.5 (for first 4 additional hours) = $22.5

Overtime hourly rate = $15 × 2 (for further additional hours after 4 additional hours) = $30.

As Colin has worked for 47 hours, his gross salary is =

($15 × 40 hours) + ($22.5 × 4 hours) + ($30 × 3 hours)

= $780

<em>Requirement 3 & 4</em>

<em>3. Messy's gross salary - </em>

Peeling guavas at $2 per kilogram. As the Messy has peeled 27 kilogram guavas, his gross salary = $2 × 27 kilogram = $54

<em>4. Goyoh's gross salary -</em>

Basic Salary = $800

Commission = 4% of sales

Current year's sales = $120,000

It means, he will receive the basic salary and commission on sales as a gross salary.

Therefore, Gross Salary = $800 + ($120,000 × 4%)

Gross Salary = $800 + $4,800

Gross Salary = $5,600

For the job purpose, he will receive the basic salary and for the performance purpose, he will receive the commission as well.

4 0
3 years ago
A firm that sells goods that it purchases for re-sale is a
MrRissso [65]
The answer to the question above is Re-sellers. not to mention the question above stating that a firm sells goods that is purchased for a re-sale automatically refers to the Re-sellers. The Re-sellers can be a retailer that sells to the end users or sells to other business firms like the whole seller. basically the term Re-seller is a firm that who buys product lesser in the market and sells it with added value.
3 0
3 years ago
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