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djverab [1.8K]
3 years ago
14

A $2.00 increase in a product's variable expense per unit accompanied by a $2.00 increase in its selling price per unit will: A)

decrease the degree of operating leverage. B) decrease the contribution margin. C) have no effect on the break-even volume. D) have no effect on the contribution margin ratio.
Business
1 answer:
liubo4ka [24]3 years ago
3 0

Answer:

A) decrease the degree of operating leverage

Explanation:

The contribution margin is

sales - variable:

(sales + 2) - (variable + 2) = sales - variable

no change

so B is FALSE

as the contribution margin ratio is:

(sales - variable ) / sales

this increase will impact the contribution margin ratio.

(sales + 2 - (variable +2))/ (sales + 2)

(sales - variable) / (sales + 2)

the CMR will decrease.

so D is FALSE

the break-even on sales will increase as the CMR decreases

more units are needed to fullfil the fixed cost

so C is FALSE

A) decrease the degree of operating leverage

ΔEBIT / Δrevenue

sales increase and the variable cost increases

a change in the sales revenue will not be as efficient as it was before the degree of leverage will decrease.

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On January 1, 2021, American Corporation purchased 25% of the outstanding voting shares of Short Supplies common stock for $210,
Usimov [2.4K]

Answer:

"$224,000" is the correct solution.

Explanation:

The given values are:

Corporation purchased percentage,

= 25%

Original investment,

= $210,000

Short's net income,

= $80,000

Paid cash dividend,

= $24,000

Now,

The share of net income will be:

= 25 \ percent\times 80,000

= 0.25\times 80000

= 20,000 ($)

The cash dividend will be:

= 25 \ percent\times 24,000

= 0.25\times 24,000

= 6,000 ($)

hence,

On December 31, 2021, the balance will be:

= Original \ investment+Net \ income \ share+Cash \ dividend

= 210,000+20,000+6,000

= 230,000-6,000

= 224,000 ($)

6 0
2 years ago
question 5 you're anticipating audience questions, especially one asking how you were able to connect the campaign with the resu
notka56 [123]

The detail you need to add to your next slide should address the issue of questions from the audience.

<h3>What is a Presentation?</h3>

This refers to the use of diagrams, charts, and tables to present an idea to an audience.

Hence, we can see that The detail you need to add to your next slide should address the issue of questions from the audience.

This is because you are being proactive by adding a slide of potential questions from the audience.

Read more about presentations here:

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4 0
2 years ago
If you could replace all of the grass in the world with something else, what would it be and why?
dedylja [7]

Answer:

I would replace it with cannabis, everyone is happier when there is green :)

Explanation:

4 0
2 years ago
Read 2 more answers
An acquisition premium is the amount by which the price offered for an existing business exceeds the Select one: a. amount paid
MAVERICK [17]

Answer:

d. pre-acquisition market value of the target company.

Explanation:

An acquisition premium is the amount by which the price offered for an existing business exceeds the pre-acquisition market value of the target company.

An acquisition premium gives the difference between the actual amount of money paid in acquiring a target firm and the estimated real value of obtaining the firm before the acquisition.

Acquisition premium are usually recorded on the balance sheet as "goodwill."

8 0
3 years ago
Bogart Company is considering two alternatives. Alternative A will have revenues of $146,100 and costs of $104,400. Alternative
irinina [24]

Answer:

Choosing alternative B would increase net income by $17,100

Explanation:

The analysis showing the incremental revenues,costs and net income of alternative A and B is shown below:

              Alternative A           Alternative   B     Difference between A&B

Revenues        $146,100            $185,900           $39800

Costs               ($104,400)           ($127,100)        ($22700 )

Net income      $41,700                 $58,800        $17,100

Alternative B records a higher net income compared to Alternative A,hence choosing alternative B would increase net income by $17,100

r

4 0
3 years ago
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