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zhuklara [117]
3 years ago
6

Bailey Corporation manufactures and sells a number of products, including Product G. Results for last year for the manufacture a

nd sale of Product G are as follows: Sales $750,000 Less expenses: Variable production costs $450,000 Sales commissions 110,000 Salary of product manager 95,000 Fixed product advertising 80,000 Fixed manufacturing overhead 70,000 805,000 Net operating loss ($55,000) Assume that dropping Product G would result in a $40,000 increase in the contribution margin of other product lines. If Bailey chooses to drop Product G, then the change in net operating income next year due to this action will be a: Bailey is trying to decide whether or not to discontinue the manufacture and sale of Product G. All expenses other than fixed manufacturing overhead are avoidable if the product is dropped. None of the fixed manufacturing overhead is avoidable. by Dropping G and increasing the contribution margin of other products will cause an increase of $25,000
Business
1 answer:
snow_lady [41]3 years ago
8 0

Answer:

Effect on income= $25,000 increase

Explanation:

Giving the following information:

Sales $750,000

Variable production costs $450,000

Sales commissions 110,000

Salary of product manager 95,000

Fixed product advertising 80,000

Fixed manufacturing overhead 70,000

Net operating loss ($55,000)

Assume that dropping Product G would result in a $40,000 increase in the contribution margin of other product lines.

We need to calculate the effect of dropping Product G.

Effect on income= - Net operating loss + increase in contribution margin - fixed overhead costs

Effect on income= 55,000 + 40,000 - 70,000= 25,000 increase

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The intent of corporate advertising is to make sure that all of a company's products are seen in a common, positive manner. True
evablogger [386]

Answer:

False since the intent of corporate advertising is usually done to ensure that the perception of the company's image is positive.

Explanation:

Corporate advertising is usually done to ensure that the perception of the company's image is positive. The products under the corporation is not a priority in this case, rather its is the company as a whole that needs to be viewed in good light.

This kind of advertising forms part of the public relations techniques used by the company or institution to improve its public image. There are so many companies with different brands under them that utilize this advertising technique to improve their standing in the public eye. It is a way of making the company itself to be a brand by advertising the company as a package.

These companies always want to prove that they care more about the public than they care for the products, in this way they create the perception that the company is primary and anything else is secondary.

Cooperate advertising is majorly used in companies whose business activities have a negative effect to the public. Cooperation that engage in mining activities or activities that affect the environment are likely to utilize this form of advertising.

6 0
3 years ago
Ann recently saw an ad for Claritin, a medicine perfect for counteracting her allergy symptoms. She immediately went to the stor
Black_prince [1.1K]

Answer: response

Explanation: she responded to the advertisement

3 0
2 years ago
Read 2 more answers
Raintree Cosmetic Company sells its products to customers on a credit basis. An adjusting entry for bad debt expense is recorded
Sedaia [141]

Journal entries

Dr Allowance for uncollectible account $41,000

Cr Account Receivable $41,000

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5 0
3 years ago
Assume that you purchased a $1,000 perpetual bond (coupon payment is $50) and the interest rate on that bond declined from 5 per
Svetlanka [38]

Answer:

D) all of the above

Explanation:

First find the present value for each alternative  using PV of perpetual cashflow formula;

PV = CF / rate

CF = 50

If rate= 5%;

PV = 50/0.05 = $1,000

If rate = 2%;

PV = 50/0.02 = $2,500

With these two calculations, we see that;

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Hence , all these choices are correct!

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3 years ago
Cox Co. accounts for its inventory using the LIFO cost method. An inventory loss from a permanent market decline of $360,000 occ
kirill115 [55]

Answer:

$360,000

Explanation:

Last in first out (LIFO) is a method used in inventory where the cost of most recently purchased goods is the one to be expensed first. Also current losses are the first to be reported.

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The loss reported in May will be reported for that quarter in June.

8 0
3 years ago
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