Answer:
A. Downward sloping; economies of scale
Explanation:
As the costs rise slower than quantity produced, the cost for each additional unit produced (marginal cost) is decreasing. That is when the Average Cost curve is downward sloping.
At that point the more products are made (scales of production) the lower unit cost becomes (more economic), which means economies of scale.
Answer:
The multiple choices are as follows:
a) 41.45
b) 42.40
c) 38.92
d) 40.22
The correct option is C,$38.92
Explanation:
The maximum price a prudent and rational investor would be willing to pay for a share of Valorous stock today is the present value of future cash flows promised by the stock.
The stock promised to pay dividend of $1.90 at year end ,$2.35 next year and would command a price of $41 per share at the end of next year.
Share price=$1.90/(1+8%)+$2.35/(1+8%)^2+$41/(1+8%)^2=$38.92
The above calculation makes of use of discounting factor which is given by 1/(1+r)^n
r is the cost of capital of 8%
n is the relevant of cash flow
Answer:
C
Explanation:
Here, we are asked to calculate the ending balance in the accounts receivable account at the end of January.
To calculate this, we employ a mathematical approach;
Mathematically;
The closing balance in account receivables = opening balance + services performed on account - cash received during month
From the question, we identify the following;
The opening balance in accounts receivable = $180,000
Services performed on account = $700,000
cash received = $230,000
we input these values into the equation;
Closing balance = 180,000 + 700,000 - 230,000 = $650,000
Answer:
Computation of net cash provided by operating activities under the indirect method
<em>Cash flow from Operating Activities</em>
Net Income $370,000
<u>Adjastment for Non-Cash Items:</u>
Depreciation $92,500
<u>Adjastment of Other Items already included:</u>
Loss on Disposal of Plant Assets $37,000
Net Cashflow from Operating Activities $499,500
Explanation:
Indirect method makes adjastment to Net Income on the following items:
1.Non-Cash Items already included in the Calculation of Net Income
In this case Depreciation is a non-cash item and is added back to arrive at cash flow amount related to Net Income
2.Other items already included in other sections of cashflow statement
Loss on disposal is added back to Net Income. This relates to Activity in Investments
3. Changes to Working Capital
No further details applied to this section in the question.
Answer:
B
Explanation:
We have to consider the opportunity cost of both parties
Opportunity cost is the cost of the next best option forgone when one alternative is chosen over other alternatives.
If Ana chooses to shear, she would be forgoing an income $120
If Shen chooses to shear for 6 hours, she would be forgoing an income ($15 x 6) = 90
Shen has a lower opportunity cost and should shear