Answer:
the unit cost of producing 2,000 cell phones per day would be lower than the unit cost of producing 1,000 units per day.
Explanation:
The costs of producing the 2000 units per day will be lower due to the following reason:
<em>Economies of scale.</em> The company will enjoy the benefits associated with large scale productions. When purchasing raw materials, the company will be a position to bargain for better discounts. The production cost is spread among finished products. A large production keeps the cost per item low.
<em>Some fixed costs may not change</em>. By adding a new plant, the company will increase production activities. Variable costs will increase, but some fixed costs are likely to remain the same. Administrative cost, top management salaries will not be affected. It means a larger number of finished used will absorb the fixed cost.
<em>Efficient machines</em>: The company has invested in new and more efficient machines. Efficiency implies the use of less labor, less power, and faster production. The result is a lower cost of production.
Answer:
As a result of this sale, the firm's net cash flow will increase by more than $32,900. The right option is 1.
Explanation:
According to the given we have the following:
asset cost= $72,800
current book value=$42,760
sale=$32,900
Therefore, loss=current book value-sale
loss=$42,760-$32,900
loss=$9,860
tax saving on loss=$9,860*21%=$2,070.60
Therefore, net cash flow=$32,900+$2,070.60
net cash flow=$34,970.60
As a result of this sale, the firm's net cash flow will increase by more than $32,900
Answer:
$15 per backpack
Explanation:
The average variable cost per of producing a backpack by using the high low method is shown below:
Variable cost per backpack = (High total cost - low total cost) ÷ (High backpack produced - low backpack produced )
= ($110,000- $87,500) ÷ (4,000 backpack produced - 2,500 backpack produced )
= $22,500 ÷ 1,500 backpack produced
= $15 per backpack
Answer:
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