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lesya692 [45]
3 years ago
13

BrewCo sells coffeemakers for $120 each. The firm currently has variable costs per unit of $65. If BrewCo is able to reduce its

variable cost per unit to $58, its contribution margin ratio will _____
Business
1 answer:
sineoko [7]3 years ago
5 0

Answer:

The contribution margin ratio will increase.

Explanation:

Giving the following information:

BrewCo sells coffeemakers for $120 each. The firm currently has variable costs per unit of $65. BrewCo can reduce its variable cost per unit to $58.

Contribution margin ratio= (selling price - unitary variable cost)/selling price

New Contribution margin ratio= (120 - 58)/120= 0.52

Old Contribution margin ratio= (120 - 65)/120= 0.46

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The number one reason for failure of new business is
Ipatiy [6.2K]
The number one reason for failure of a new business is poor management.


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4 0
3 years ago
Suppose First Main Street Bank, Second Republic Bank, and Third Fidelity Bank all have zero excess reserves. The required reserv
dlinn [17]

Answer:

Change in Excess Reserves $1,350,000

Change in Required Reserves $450,000

Explanation:

Preparation of the table to show the effect of a new deposit on excess and required reserves

Based on the information given since the REQUIRED RESERVE RATIO is 25%, which means that First Main Street Bank will hold 25% of its initial deposit leading to INCREASE in the REQUIRED RESERVE by the amount of $450,000 (25%*$1,800,000) while the remaining 75% (100%-25%) will be the EXCESS RESERVES of the amount of $1,350,000 (75%*$1,800,000).

Hence:

Amount Deposited: $1,800,000

Change in Excess Reserves=$1,350,000

Change in Required Reserves= $450,000

Therefore the effect of a new deposit on excess and required reserves will be:

Change in Excess Reserves $1,350,000

Change in Required Reserves $450,000

4 0
3 years ago
To prepare for the construction of its new headquarters, Baker Co. purchased a 500-acre plot of land on August 5, Year 1. Baker
leonid [27]

Answer:

FASB ASC 835-20-15-8

Explanation:

This section explicitly states that in order for interests to qualify for interest capitalization, the assets purchased through the loan must be getting ready for its intended use. E.g. if you want to capitalize the interests on the land, you must carry out activities necessary to prepare it for its intended use. Or if you purchase a machinery, you must be installing it in order to get it ready to produce.

4 0
3 years ago
You are planning on starting your own business in 18 months and you intend to purchase a new home. You have looked carefully at
Leya [2.2K]
B. Your banker is not aware of your of your other long term financial goals
7 0
3 years ago
Kirkwood acquires 100 percent of the outstanding voting shares of Soufflot Company on January 1, 2018. To obtain these shares, K
lesya [120]

Answer:

$555,000

Explanation:

Calculation for the amount that will be reported for consolidated cash after the acquisition is completed

Cash at Kirkwood Inc $475,000

(900-400-15-10)

Add Cash at Soufflot Company $80,000

Consolidated cash after acquisition is completed $555,000

Therefore the amount that will be reported for consolidated cash after the acquisition is completed will be $555,000

4 0
3 years ago
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