Answer:
26.66 or 27%
Explanation:
The computation of the margin of safety percentage is shown below:
Margin of Safety
= 100 - Break Even %
= 100 - 73.33
= 26.66 or 27%
Working Note
Sales (3,000 units) $60,000
Less: Variable expenses -$42,000
Contribution margin -$18,000
CM Ratio (A) 30.00%
Fixed expenses (B) 13,200
Break Even Point C = B ÷ A 44,000
Break Even % of Total Sale 73.33%
a). Breakeven point = Total fixed costs ÷ Contribution margin ratio
Contribution ratio = Contribution margin ÷ Total sales
Contribution ratio = $822,212 ÷ $1,953,000 = 0.421
Breakeven point = $520,000 ÷ 0.421= $1,235,154.
b). Margin of safety = Total Sales - Break-even point
Margin of safety = $1,953,000 – $1,235,154= $717,846.
c) Target profit =(Total fixed costs + Target profit) ÷ Contribution margin ratio
Target profit = ($520,000 + $200,000) ÷ 0.421= $720,000 ÷ 0.421= $1,710,214
Explanation:
The Data sheet has been added as an attachment
Answer: The answers to the question are provided below.
Explanation:
The basic objective of the monetary policy is to achieve economic growth, full employment, and price stability in an economy. The major strengths of the monetary policy are its flexibility and speed when compared to fiscal policy. Monetary policy is faster to implement and brings about desired changes faster.
Monetary policy is easier to conduct than fiscal policy because:
• Monetary policy is implemented by independent monetary authorities. Therefore, unpopular decisions such as the increase of interest rates to decrease inflationary pressure can be used.
• Fiscal Policy is the use of taxation and government spending to control economic activities but it is difficult to get a department that is willing to have its spending cut in order to help the economy.
• Increasing taxes will always be unpopular among individuals and firms and increasin corporations and income tax may lead to supply side effects. For example, increasing income tax may lead to the reduction in the incentives to work.
Fiscal and monetary policies are both effective. In a deep recession and a liquidity trap, the fiscal policy can be more effective than the monetary policy because the government creates job, pays for new investment schemes, rather than relying on the use of monetary policy to indirectly motivate businesses to invest. Likewise, the monetary policy is also more flexible and faster.
Answer:
There are many different price adjustment strategies which can be implemented in the current market.
Explanation:
Psychological pricing:
Psychological pricing is a strategy in which the price of a product is displayed with mostly one cent difference so the whole number shown is less by $1 and this difference can get higher if the price of the product is more.
Example 1: The price for a toy in a toy shop is $4.99, if rounded this will be $5 but the whole number visible is $4.
Example 2: The price of a laptop is $193, this again is nearly $200 but the price is reduced by $7 in order to influence their customers into buying the product.
Example 3: The price of a car is $35,995, this again is about $36,000 but the buyer may be influenced by this technique and result in purchasing the product with such price.
Geographical Pricing:
Geographical pricing is a strategy where different prices are charged in different outlets, this strategy is made keeping in mind the purchasing power of the locality, if the local people can pay higher price for a product then the price is high there but same product may have a lower price in an area where people can not pay high price.
Example 1: Price of a T-shirt is $15 in a posh area while the price of the same T-shirt is $5 in an area with poor locality.
Example 2: Price of a hair brush is $10 in a poor area while the same brush is available in a posh area at a rate of $35.
Example 3: Price for a food item is $6 in a restaurant in posh area while the same burger is available for $3 in a restaurant in a poor area.
Senior management usually approves broad guidelines for HR activities, like hiring and firing, performance appraisals, promotions, and discipline. These are called standing plans.
<h3>Standing plans </h3>
A standing plan is a business plan that is intended to be used many times. It is designed to guide managerial decisions and actions that tend to be recurring. It is used over a long period, sometimes indefinitely, and is altered as circumstances change.
Examples of standing plans include policies for hiring, employee interaction, procedures for reporting internal issues, or complaints to the HR department, etc. and regulations in terms of what is permitted and what is prohibited in the workplace.
Learn more about standing plans here :
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