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enyata [817]
3 years ago
5

Martinez Company uses flexible budgets to control its selling expenses. Monthly sales are expected to range from $166,900 to $19

8,400. Variable costs and their percentage relationship to sales are sales commissions 6%, advertising 5%, traveling 4%, and delivery 2%. Fixed selling expenses will consist of sales salaries $35,300, depreciation on delivery equipment $6,600, and insurance on delivery equipment $1,000.
Prepare a monthly flexible budget for each $11,100 increment of sales within the relevant range for the year ending December 31, 2017.
Business
1 answer:
kolezko [41]3 years ago
4 0

Answer:

<u>monthly flexible budget for each $11,100 increment </u>

Sales                                                               $11,100

Less Sales Commissions ( $11,100 × 6%)       ($666)

Net Sales                                                       $10,434

advertising ( $11,100 × 5%)                              ($555)

traveling ( $11,100 × 4%)                                  ($444)

delivery ( $11,100 × 2%)                                   ($222)

Net Income                                                     $9,213

Explanation:

Consider Only the incremental costs and revenues.Fixed costs are not relevant for the $11,100 increment

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4 0
3 years ago
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Suppose the owners of Lopes and HomeMax meet for a friendly game of golf one afternoon and happen to discuss a strategy to optim
Amiraneli [1.4K]

Answer:

c. $2.0 million for Lopes and by $2.5 million for HomeMax.

Explanation:

For the problem above, the two organizations agreed to work on a particular project because they believed that they will benefit from the outcome of the project. Based on the available information provided in the question, the profit that Lopes will make yearly will increase by $2.0 million while that of HomeMax will increase by $2.5 million.

3 0
3 years ago
Midwest Water Works estimates that its WACC is 10.5%. The company is considering the following capital budgeting projects:
krok68 [10]

Answer:

Projects A,B,C,D and E should be accepted

Explanation:

Based on the fact that each of the itemized projects has the same of level of risk as the company's existing assets, we suggest that the firm undertake those projects that gives a return rate which is above the current weighted average cost of capital of 10.5%

In essence,projects A,B,C,D and E should be accepted as they 12%,11.5%,11.2%,11% and 10.7% returns on investment respectively.

Projects F& G would be rejected on the premise that their rates of return are lower than what is currently obtainable in Midwest Water Works.

7 0
2 years ago
Among the costs Kunee Company incurred during the month of August were the following: $15,000 - coolant used in the headquarters
uranmaximum [27]

Answer: Option (B) is correct.

Explanation:

Given that,

Coolant (used in the office air-conditioning system) cost  = $15,000

Property taxes on factory building = $45,000

Depreciation on trucks = $10,000

Salary paid = $2,000

Period cost = Coolant cost + Depreciation on trucks

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6 0
3 years ago
Nick and Beth run a catering business in which they have two major tasks: getting new clients and preparing food for events and
Burka [1]

Answer:

NICK

NICK

2

Explanation:

A company has absolute advantage in the production of a good or service if it produces more quantity of a good when compared to other countries

Nick prepares food in 8 hours while Beth produces the food in 12 hours. ick thus has an absolute advantage in food preparation because he produces food in less time

A country has comparative advantage in production if it produces at a lower opportunity cost when compared to other countries.

Opportunity cost of Nick in food preparation = 4/8 = 0.5 hours

Opportunity cost of Beth in food preparation = 3 / 12 = 0.25 hours

Nick has a comparative advantage in food preparation

3 0
2 years ago
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