A firm would be experiencing a loss but still be producing if the price is Below $5 but above $4.
When does a firm decision not to produce any output its loss equals?
If the company decides to cease operations and stop generating any output, its revenue is, by definition, zero. By definition, its variable cost of production is also zero, making the overall cost of production for the company equal to its fixed cost.
Under which condition would the firm be incurring a loss?
When producing nothing offers better returns than creating some q units of output, a firm would be better off ceasing operations, for example. This states that if average variable expenses are higher than the price of the good, the company would be better off closing up shop since it cannot pay its variable costs as well.
Why would a firm that incurs losses choose to produce?
When sales fall short of total costs, losses happen. Even though the company is losing money, it is better to produce in the short term rather than closing down if revenues exceed variable expenses but not total costs.
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Answer: c. The project contains simple activity sequences
Explanation:
Gantt chart is a firm of bar chart that depicts a project schedule as it helps in the scheduling of a particular project.
Gantt chart is a graphical tool that helps in showing the activities that are performed against time to the project team or project manager. Gantt charts are effective for project scheduling if such project contains simple activity sequences.
Answer:
d. It will have a credit balance of $100,000.
Explanation:
In the income statement, the total revenues and the total expenses are recorded.
If the total revenues are more than the total expenditure then the company earns net income
And, If the total revenues are less than the total expenditure then the company have a net loss
This net income or net loss would reflect in the statement of the retained earning account.
So, the balance of income summary equals to
= Sales - expenses
= $540,000 - $440,000
= $100,000
The dividend should be deducted from the retained earning account. Hence, it will not be consider here
Answer:
Effect on income= $6,000 increase
Explanation:
<u>Because there is an unused capacity and it is a special order, we will not take into account the fixed costs.</u>
Effect on income= total contribution margin
Unitary variable cost= 8 + 10 + 4= $22
Effect on income= 1,000*(28 - 22)
Effect on income= $6,000 increase