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3 years ago

How can trade-offs and opportunity costs be measured?

Business

1 answer:

vovikov84 [41]3 years ago

4 0

Answer:

see below

Explanation:

The terms opportunity cost and trade-off are, in most cases, used interchangeably. Opportunity cost occurs due to scarcity of resources. Individuals have to make choices among the options available to them. The fortified option is the trade-off or the opportunity cost.

Opportunity cost is measured by obtaining the value of the next best alternative. In other words, the cost of the most valuable sacrificed option is the opportunity cost. For example, if a student has $50, he can purchase a meal valued at $45, watch a movie valued at $40 or buy a book for $ 47. assuming he opts to buy the book, the meal becomes the opportunity cost because it represents the next best alternative.

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The Mighty Music Company produces and sells a desktop speaker for $100. The company has the capacity to produce 50,000 speakers

castortr0y [4]

Answer:

$75

Explanation:

Calculation to determine what selling price will the company be indifferent between accepting and rejecting the special order

Using this formula

Selling price between accepting and rejecting the special order= ( Additional cost ÷ Units sold number) + Unit level Cost

Let plug in the formula

Selling price between accepting and rejecting the special order= ( $15,000 ÷ 500 ) + $45

Selling price between accepting and rejecting the special order= $30 + $45

Selling price between accepting and rejecting the special order= $75

Therefore The selling price that the company will be indifferent between accepting and rejecting the special order is $75

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2 years ago

Salah’s net income for the year ended December 31, Year 2 was $191,000. Information from Salah’s comparative balance sheets is g

krok68 [10]

Answer:

Cash Dividends - Year 2 = $84400

Explanation:

The net income of the business is usually appropriated or used for two purposes at the end of the year. It is either used to pay dividends or is retained in the business and is added to the retained earnings or both.

Thus, to calculate the dividends paid by the business in a particular year, we can calculate the change in retained earnings and deduct it from the net income.

Change in retained earnings = Ending balance of retained earnings - Beginning balance of retained earnings

Change in retained earnings = 694000 - 587400

Change in retained earnings = $106600

Thus, out of the net income of $191000, $106600 were transferred to retained earnings. So, the amount of dividends paid for the year is,

Cash Dividends - Year 2 = 191000 - 106600 = $84400

7 0

2 years ago

Seidman Company manufactures and sells 20,000 units of product X per month. Each unit of product X sells for $17 and has a contr

True [87]

Answer:

Effect on income= $115,000 decrease

Explanation:

Giving the following information:

Fixed costs= $45,000

Number of units= 20,000

Unitary contribution margin= $8

<u>To calculate the effect on income, we need to use the following formula:</u>

Effect on income= decrease in fixed costs - decrease in contribution margin

Effect on income= 45,000 - 20,000*8

Effect on income= $115,000 decrease

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2 years ago

A company has beginning inventory of 10 units at a cost of $10 each on February 1. On February 3, it purchases 20 units at $12 e

Gre4nikov [31]

Answer:

b) $124

Explanation:

FIFO means first in, first out. Under this principle, goods that were purchased or produced earlier will be the first ones on sale.

The value of the goods sold in our case will be as follows.

The first ten items @ $10: 10X10 =$100

Two items to make [email protected] $12: 2x12=$24

Total cost: $100+$24= $124

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3 years ago

You are sitting around the fire at a lodge in Dillingham, Alaska, discussing a fishing expedition you are planning with your col

Orlov [11]

As indicated in the Preliminary Scope Statement, some of the potential risks associated with the fishing expedition are:

Risk of Water damage to equipment;
Risk of drowning
Risk of potential loss of fishing equipment. etc.

<h3>What is a Preliminary Scope Statement?</h3>

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When writing a Preliminary Scope Statement, the goals or objectives have to be itemized in a manner that is:

Easy to understand
Actionable; and
Measurable.

Learn more about the Preliminary Scope Statement at:
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6 0

2 years ago