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Natalka [10]
3 years ago
10

Sherri's Tan-O-Rama is a local tanning salon. The following information reflects its number of appointments and total costs for

the first half of the year:
Month Number of Appointments Total Cost
January 325 5,900
February 375 6,200
March 300 5,650
April 350 5,450
May 275 5,550
June 450 6,250

Using the high-low method, calculate the total fixed cost per month and the variable cost per tanning appointment. (Round your "Variable Cost per Unit" answer to 2 decimal places and "Fixed Cost" answer to the nearest dollar amount.)
Business
1 answer:
Alenkinab [10]3 years ago
4 0

Answer:

C =  6.5Q + 3,762.5

Explanation:

High-low method:

We subtract the high from the low:

\left[\begin{array}{ccc}High&375&6200\\Low&275&5550\\Diference&100&650\\\end{array}\right]

The difference tell us that 100 untis generate 650 additional cost

So we can calcualte the variable cost:

cost 650 / Unis 100 = variable cost 6.5

Now on low or high we solve for fixed cost:

cost = 6.5 x 375 + fixed cost

Total Cost 6200

Variable 2437.5

Fixed Cost 3762.5

cost = 6.5 x 275 + fixed cost

Total Cost 5550

Variable 1787.5

Fixed Cost 3762.5

the formula will be:

C =  6.5Q + 3,762.5

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Abercombie Inc. will invest in a project. The project will give the company $10,000 on January 1, 2014, $23,000 on May 8, 2014,
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Answer:

$136,539.57

Explanation:

The present value of the project can be determined by using the cfj function of a Financial calculator as follows :

$0 CF0

$10,000 CF 1

$23,000 CF2

$33,000 CF3

$42,000 CF4

$55,000 CF5

I/YR = 5 %

Then SHIFT NPV gives $136,539.57

therefore,

the present value of the project is $136,539.57

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2 years ago
You want to buy a new car, but you can make an initial payment of only $1,200 and can afford monthly payments of at most $850. a
Leviafan [203]

Answer:

a. The maximum price you can pay for the car is <u>$33,477.87</u>.

b. The maximum price you can pay for the car is <u>$39,411.78</u>.

Explanation:

a. If the APR on auto loans is 12% and you finance the purchase over 48 months, what is the maximum price you can pay for the car? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

This can be determined as follows:

<u>Calculation of the Present Value (PV) of the monthly payments</u>

To calculate, the formula for calculating the present value of an ordinary annuity is used as follows:

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

Where;

PV = Present value of the monthly payments = ?

P = Monthly payment = $850

r = monthly interest rate = annual percentage rate (APR) / 12 = 12% / 12 = 1%, or 0.01

n = number of months = 48

Substitute the values into equation (1) to have:

PV = $850 * ((1 - (1 / (1 + 0.01))^48) / 0.01)

PV = $850 * 37.9739594934803

PV = $32,277.87

<u>Calculation of the maximum price you can pay for the car</u>

Given in the question is initial payment of only $1,200.

The present value of the monthly payments calculated above is $32,277.87.

Therefore, we have:

Maximum price = Initial payment + Present value of the monthly payments = $1,200 + $32,277.87 = $33,477.87

Therefore, the maximum price you can pay for the car is <u>$33,477.87</u>.

b. How much can you afford if you finance the purchase over 60 months? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

This can also be determined as follows:

<u>Calculation of the Present Value (PV) of the monthly payments</u>

To calculate this, we use equation (1) in part (a) above, change number f months to 60 and proceed as follows:

PV = Present value of the monthly payments = ?

P = Monthly payment = $850

r = monthly interest rate = annual percentage rate (APR) / 12 = 12% / 12 = 1%, or 0.01

n = number of months = 60

Substitute the values into equation (1) to have:

PV = $850 * ((1 - (1 / (1 + 0.01))^60) / 0.01)

PV = $850 * 44.9550384062241

PV = $38,211.78

<u>Calculation of the maximum price you can pay for the car</u>

Given in the question is initial payment of only $1,200.

The present value of the monthly payments calculated above is $38,211.78.

Therefore, we have:

Maximum price = Initial payment + Present value of the monthly payments = $1,200 + $38,211.78 = $39,411.78

Therefore, the maximum price you can pay for the car is <u>$39,411.78</u>.

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4 0
3 years ago
A minor can disaffirm a contract if:
SashulF [63]

Answer:

a. he or she has not ratified the contract on reaching majority.

Explanation:

Generally a minor is allowed to dissaffirm a contract they entered when they were underaged. Also when they attain the age of majority they will need to ratify the contract for it to be binding.

In the case where the contract has not been ratified on reaching majority, it can still be dissaffirmed.

Contracts with minors are void, and only some state laws allow for ratification of the contract on attainment of majority age.

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