The Company uses lower-of-cost-or-market approach. The replacement cost of an inventory item is $75. Net realizable value is $82
2 answers:
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Answer:
Explanation:
Illustrate the following with supply and demand curves:
a. With increased access to wireless technology and lighter weight, the demand for tablet computers has increased
substantially. Tablets have also become easier and cheaper to produce as new technology has come online. Despite the shift of demand, prices have fallen.
b. Cranberry production in Massachusetts totaled 1.85 mil-lion barrels in 2013, a 15 percent decrease from the 2.12 million barrels produced in 2012. Demand decreased by even more than supply, dropping 2013 prices to $32.30 per barrel from S47.90 in 2012.
c. During the high-tech boom in the late 1990s, San Jose office space was in high demand and rents were high. With the national recession that began in March 2001, however, the market for office space in San Jose (Silicon Valley) was hit hard, with rents per square foot falling. In 2005, the employment numbers from San Jose were rising slowly and rents began to rise again. Assume for simplicity that no new office space was built during the period.
d. Before economic reforms were implemented in the countries of Eastern Europe, regulation held the price of bread substantially below equilibrium. When reforms were implemented, prices were deregulated and the price of bread rose dramatically. Asa result the quantity of bread demanded fell and the quantity of bread supplied rose sharply.
e. The steel industry has been lobbying for high taxes on imported steel. Russia, Brazil, and Japan have been producing and selling steel on world markets at $610 per metric ton, well below what equilibrium would be in the United States with no imports. if no imported steel was permitted into the country, the equilibrium price would be 970 per metric ton. Show supply and demand curves for the United States, assuming no imports; then show what the graph would look like if U.S.
buyers could purchase all the steel that ' they wanted from world markets at $610 per metric ton; label the portion of the graph that represents the quantity of imported steel.
The detailed answer is attached
Answer: Degree of Operating Leverage
A Tech = 2.75
Z Tech = 3
Explanation:
As defined in question itself,
Degree of Operating Leverage =
As here, it is provided that profit for both the companies are same amounting $4 million.
Although the fixed cost differ by $1 million.
A Tech Degree of operating Leverage = 1 + = 2.75
Z Tech Degree of Operating Leverage = 1 + = 3
This clearly demonstrates that A Tech will reach its break even faster than the Z Tech as the ratio of fixed cost to variable cost is lower in A tech in comparison to Z Tech.