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Anettt [7]
3 years ago
11

When using the benefi t-cost ratio measure of worth, what benchmark is the calculated ratio compared to in determining if an ind

ividual investment is attractive?
Business
1 answer:
Mazyrski [523]3 years ago
3 0

Answer:

1.0

Explanation:

Benefit-cost ratio BCR can be expressed in monetary or qualitative terms. It presents the relationship between the relative costs and benefits of a proposed project.

If a project has a BCR greater than 1.0, the project is expected to be attractiveto a firm and its investors.

If a project's BCR is less than 1.0, the project's costs outweigh the benefits, and it should not be considered because it is unattractive.

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Becker Bikes manufactures tricycles. The company expects to sell 520 units in May and 650 units in June. Beginning and ending fi
Kitty [74]

Answer:

The budgeted variable overhead for May is $5,335

The budgeted variable overhead for June is $7,260

The budgeted fixed overhead for both May and June is $11,500 per month

Explanation:

First we have to determine how many tricycles does Becker Bikes expects to manufacture during May and June:

May:

beginning inventory May           180

expected sales May                   520

ending inventory May                 145

Becker is planning to manufacture 485 tricycles (= 520 + 145 -180)

June:

beginning inventory May           145

expected sales May                   650

ending inventory May                 155

Becker is planning to manufacture 660 tricycles (= 650 + 155 -145)

The budgeted variable overhead for May = 485 tricycles x $11 per tricycle = $5,335

The budgeted variable overhead for June = 660 tricycles x $11 per tricycle = $7,260

The fixed overhead for both May and June is $11,500 per month

8 0
3 years ago
Sabv Corporation's break-even-point in sales is $840,000, and its variable expenses are 75% of sales. If the company lost $34,00
zhuklara [117]

Answer:sales must have amounted to:$704,000

Explanation:

Contribution ratio = Sales ratio - Variable cost ratio

= 100%- 75%

=25%

Sales to break even = Fixed expenses / Contribution margin ratio

Therefore,

 Fixed expenses = Sales to break even   x  Contribution margin ratio

=$840,000 x 25%

=$210,000

Contribution margin can also be calculated as

Fixed expenses- Operating loss

=$210,000 -$34,000

=$176,000

Sales = Contribution margin/ Contribution ratio

= $176,000/25% =$704,000

5 0
3 years ago
If a borrower can afford to make monthly principal and interest payments of 1000 and the lender will make a 30 year loan at 5 1/
Alexus [3.1K]

Answer:

The the largest loan this buyer can afford is 14,533.75.

Explanation:

This can be determined using the formula for calculating the present value of an ordinary annuity as follows:

Step 1: Calculations of the present value or the loan the buyer can afford for a 30 year loan at 5 1/2%

PV30 = P * ((1 - (1 / (1 + r))^n) / r) …………………………………. (1)

Where;

PV30 = Present value or the loan the buyer can afford for a 30 year loan at 5 1/2% =?

P = monthly payment = 1000

r = interest rate = 5 1/2% = 5.50% = 0.055

n = number of years = 30

Substitute the values into equation (1) to have:

PV30 = 1000 * ((1 - (1 / (1 + 0.055))^30) / 0.055)

PV30 = 1000 * 14.5337451711221

PV30 = 14,533.75

Step 2: Calculation of the present value or the loan the buyer can afford for a 20 year loan at 4 1/2%

PV20 = P * ((1 - (1 / (1 + r))^n) / r) …………………………………. (2)

Where;

PV30 = Present value or the loan the buyer can afford for a 20 year loan at 4 1/2% =?

P = monthly payment = 1000

r = interest rate = 4 1/2% = 4.50% = 0.045

n = number of years = 20

Substitute the values into equation (1) to have:

PV20 = 1000 * ((1 - (1 / (1 + 0.045))^20) / 0.045)

PV20 = 1000 * 13.0079364514537

PV20 = 13,007.94

Conclusion

Since 14,533.75 which is the present value or the loan the buyer can afford for a 30 year loan at 5 1/2% is greater than the 13,007.94 which is the present value or the loan the buyer can afford for a 20 year loan at 4 1/2%, it therefore implies that the the largest loan this buyer can afford is 14,533.75.

5 0
2 years ago
List TWO consequences for a company if they receive a qualified audit opinion
Lorico [155]
It can affect the company's ability to get a lending (borrow money). It can also affect the chances of finding an investor.
6 0
2 years ago
Kiano, a telecommunications equipment manufacturer, manufactures PDAs (P), wireless handsets (H), and blackberrys (B). They have
a_sh-v [17]

Answer:

Explanation:

Please check the attached file below to see answer to the given question

6 0
3 years ago
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