1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Bad White [126]
3 years ago
6

Fowler Company is a priceminustaker and uses target pricing. Refer to the following​ information: Production volume 602 comma 00

0 units per year Market price $ 30 per unit Desired operating income 17​% of total assets Total assets $ 13 comma 900 comma 000 Variable cost per unit $ 17 per unit Fixed cost per year $ 5 comma 600 comma 000 per year With the current cost​ structure, Fowler cannot achieve its profit goals. It will have to reduce either the fixed costs or the variable costs. Assuming that variable costs cannot be​ reduced, what are the target fixed costs per​ year? Assume all units produced are sold.
Business
2 answers:
frosja888 [35]3 years ago
8 0

Answer:

The target fixed cost per year for Fowler company is $5,463,000

Explanation:

In this question, we are asked to calculate the target fixed cost for a company assuming that variable costs cannot be reduced and also all units produced are sold.

We start by calculating the revenue generated by the company.

602,000 units were produced and sold at a market price of $30. This means total revenue is;

602,000 * 30 = $18,060,000

We then proceed to subtract the desired operating income from the revenue. From the question, we can identify that the desired operating income is 17% of total asset, with total asset being $13,900,000

Desired operating income = 17/100 * $13,900,000 = $2,363,000

Subtracting desired operating income from recent yields: $18,060,000 - $2,363,000 = $15,697,000

To get the target fixed cost per year, we simply subtract variable cost from the difference.

Summarily, this mathematically means that; target fixed cost per year = Revenue - Desired operating income - variable cost

Variable cost = $17 per 602,000 units per year = 17 * 602,000 = $10,234,000

Target fixed cost per year = $15,697,000 - $10,234,000 = $5,463,000

NISA [10]3 years ago
5 0

Answer:

The answer is $5,463,000

Explanation:

Assuming all units are sold, we have:

Total units produced = 602,000 units

Market price = $30

Revenue generated by Fowler Company = $30 x 602,000 = $18,060,000.

Now we calculate the desired operating income:

17% x $13,900,000

= $2,363,000

Next, we subtract desired operating income from revenue:

$18,060,000 - $2,363,000

= $15,697,000

Now, we calculate the variable cost:

$17 x 602,000 units

= $10,234,000

Next, to calculate the target fixed cost per year:

Target fixed cost per year = Revenue - Desired operating income - variable cost

= $18,060,000 - $2,363,000 - $10,234,000

= $5,463,000

You might be interested in
This question is ssssssssssssssssssssssss IDKKKKK
nexus9112 [7]

Answer:

IDKK EITHER OF WHAT YOU ARE ASKING IDK

Explanation:

I just got myself confused  XD

5 0
3 years ago
Describe the difference between a 401(k) plan and an Individual Retirement Account.
nadya68 [22]
401(k) is an employer-provided plan, IRA isn't.
4 0
3 years ago
Read 2 more answers
pportunity and related factors Develop a research instrument that can be used to assess customers' buyir behaviour for any produ
alisha [4.7K]

How to assess the behavior of consumers Facial expressions can be used to gauge eating habits and consumer preferences. shopping behavior analysis. investigating customer behavior in a natural setting. study of neuromarketing.

Many things about a person's thoughts can be deduced from their facial expressions. Humans are capable of expressing their feelings both verbally and physically. Our body language can occasionally be a dead giveaway to the true emotions we are experiencing. Unconsciously, our eyes, lips that tremble a little, nose that wrinkles, etc., all convey our hidden feelings.

By observing one's facial expressions, one can determine their emotional condition. Even as children, a teacher's severe gaze was all it took to get us to straighten up and obey. Our face is a reflection of our innermost emotions. A small percentage of people have extremely expressive faces that reveal their entire emotional state.

Learn more about facial expressions here

brainly.com/question/9022420

#SPJ9

6 0
2 years ago
Which of the following is likely to have the most price elastic demand?a. ice creamb. frozen yogurtc. vanilla ice creamd.Häagen-
zepelin [54]

Answer:

Haagen-Dazs vanilla bean ice cream

Explanation:

Demand is said to be most elastic if a slight change in price leads to a drastic change in quantity demanded. Normal goods are least elastic as increase in price does not lead to tremendous decrease in price.

However, luxury goods are most elastic as these goods are preferred when their prices are lower. They are not essential. As such, demand falls drastically in case of rise in price. So, Haagen-Dazs ice cream would have most price elasticity as this is a luxury good and rest of the items are normal goods.

3 0
3 years ago
A periodic system of inventory:
harina [27]

Answer:

A. reduces record keeping.

Explanation:

A periodic system of inventory can be defined as a method of financial accounting, that typically involves updating informations about an inventory on a periodic basis (at specific intervals) as the sales or purchases are being made by the customers, through the use of either an enterprise management software applications or a digitized point-of-sale equipment.

Hence, a periodic system of inventory reduces record keeping because there's no continuous records in real-time of the amount of inventory sold or purchased by the customers.

4 0
2 years ago
Other questions:
  • You will pay $7,000 now to purchase a perpetuity which will pay you and your heirs $340 at the end of each year, forever. What i
    9·2 answers
  • You just founded a tech startup with an incredible ROI of 100%. That is, each dollar you invest in the firm creates a permanent
    11·1 answer
  • Leona bought two different brands of wine from vineyards in Australia. When asked for her opinion about the wines, she said that
    8·1 answer
  • When Ira purchased 500 shares of prefeHallie owns 20% of the common stock of the Bean Brothers Coffee Company. The company annou
    14·1 answer
  • Managers place a high priority on internal control systems because the systems assist managers in all of the following except: a
    13·1 answer
  • Who do you think would be a better President<br> A. Trump or B. Biden
    9·2 answers
  • Ingvar Kamprad’s influence over IKEA may have even been stronger than that of Sam Walton over Walmart because IKEA is a privatel
    6·1 answer
  • describe how a company would balance the tradeoff between cost and speed when selecting a shipping method
    5·1 answer
  • What is your favorite place to eat even tho no one can go anywhere
    12·1 answer
  • Suppose a senator introduces a bill to legislate a minimum hourly wage of $6. This type of price control is called a
    10·2 answers
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!