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Leno4ka [110]
3 years ago
12

A producer of felt-tip pens has received a forecast of demand of 30,000 pens for the coming month from its marketing department.

Fixed costs of $25,000 per month are allocated to the felt- tip operation, and variable costs are 37 cents per pen.
Find the break-even quantity if pens sell 1$ each.
Business
1 answer:
Lorico [155]3 years ago
5 0

Answer: Break even Point = 39683 units  

Explanation:

Break even Point

break even point units is the number of units a firm needs to sell in order to cover the total cost  of production. it is the point where the company makes no profit or loss. Break even point units is calculated by dividing fixed cost with contribution margin  which is the Sell price minus Variable cost  

Fixed costs = $25000

selling Price = $1

variable costs = 0.37 cents

break even point units = Fixed Costs/ (selling price - variable costs)

Break even Point Units = 25000/ (1 - 0.37)

Break even Point units = 39682.53968 =  39683 (rounded off)

The demand forecast is 30000 units while the break even point units is 39683 units. The company (Producer of felt tip pens) will not make profit from the expected demand simply because  the amount of units required to cover total production costs (to break even) is higher than the demand expected.  The company will not be able to sell enough units

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An organization that regularly provides a standardized set of data on a periodic basis to its subscribers is called a ______.
Helga [31]
B.full service research supplier
4 0
3 years ago
Abardeen Corporation borrowed $90,000 from the bank on October 1, 2016. The note had an 8 percent annual rate of interest and ma
djyliett [7]

Answer:

A) $0, no cash paid in 2016, both interest and principal were paid on March 31, 2017.

B) = [($90,000 x 8%) / 12] x 3 months = ($7,200 / 12) x 3 = $600 x 3 = $1,800

C) = $90,000 + $1,800 = $91,800

D) = ($600 x 6 months) + $90,000 = $3,600 + $90,000 = $93,600

E) = $600 x 3 months = $1,800

3 0
3 years ago
You start with 100 units and end with 150 units, what is the percentage increase?
Burka [1]
In order to find out the percentage of increase, first you need to find out the difference between initial units and the ending units, in this case:

150 - 100 = 50 units

After that, you need to do this calculation:

50 units/ 100 units x 100%

= 0.5 x 100 %

= 50% increases
6 0
3 years ago
If the book value per share is $40 and the market price is 52.50 per share calculate the required rate of return on the stock.
pav-90 [236]

Answer:

0.11 or 11%

Explanation:

The computation of the required rate of return is given below:

Required Rate of Return is

= Next Year Dividend ÷ Current Market Price + Growth Rate

= $3.15 ÷ $52.50 + 0.05

= 0.06 + 0.05

= 0.11 or 11%

working note

Given that

Current Market Price = $52.50

As we know that  

Growth Rate = Return on Equity × Retained Earning Ratio

Now  

Return on Equity = EPS ÷ Book Value of Share

= $5 ÷ 40

= 12.50%

So,  

Retained Earning Ratio is

= 1 - Dividend Payout Ratio

= 1 - 0.60

= 0.40

And,

Dividend Payout Ratio = DPS ÷ EPS

= $3 ÷ $5

= 0.60

Now

Growth Rate = 12.50% × 0.40

= 5%

So,

Next Year Dividend = Dividend Recently paid × (1 + growth rate )

= $3 × 1.05

= $3.15

7 0
3 years ago
Sheffield Corp. produces a product requiring 3 direct labor hours at $16.00 per hour. During January, 2800 products are produced
Vinil7 [7]

Answer:

correct option is d. $4800 U

Explanation:

given data

product requiring =  3 direct labor hours

standard rate = $ 16 per direct labor hour

produced using = 8700 direct labor hours

actual payroll = $135720

to find out

labor quantity variance

solution

we get here labor quantity variance that is express as

Direct labor quantity variance = (standard hours worked for actual production - actual hour worked)  × standard rate per direct labor hour   ...................1

here  standard hours worked for actual production will be as

standard hours worked = standard hours required per unit of production × actual units produced      

standard hours worked = 3 × 2800

standard hours worked = 8400 hours but we have given actual work hour 8700  direct labor hours

so put all value is equation 1 we get

Direct labor quantity variance = ( 8400 - 8700 )  × $16

Direct labor quantity variance = $4800 unfavorable

so correct option is d. $4800 U

8 0
3 years ago
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