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Korvikt [17]
3 years ago
11

The following monthly data are available for Seasons Company which produces only one product: Selling price per unit, $42; Unit

variable expenses, $14; Total fixed expenses, $42,000; Actual sales for the month of June, 4,000 units. How much is the margin of safety for the company for June?
Business
1 answer:
dybincka [34]3 years ago
4 0

Answer:

The margin of safety for june is 2500 units.

Explanation:

The margin of safety is the additional units sold by a firm over its break even point.

The break even point is the point where the firm is making no profit or no loss.

To calculate the margin of safety, we first need to find out the break even point in units.

Break even in units = Fixed costs / contribution per unit

Where, contribution per unit = Selling price per unit - Variable cost per unit

So,

Break even in units = 42000 / (42 - 14) = 1500 units

The margin of safety is = 4000 - 1500 = 2500 units

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The following units of an inventory item were available for sale during the year: Beginning inventory 11 units at $51 First purc
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Answer:

$2,338

Explanation:

For computing the ending inventory, first we have to determine the average cost per unit, then ending inventory units which are shown below:

= (Beginning inventory units × price per unit +  first purchase inventory units × price per unit + second purchase inventory units × price per unit + third purchase inventory units × price per unit) ÷ (Beginning inventory units + one purchase inventory units + second purchase inventory units + third purchase inventory units)

= (11 units × $51 + 15 units × $53 + 21 units × $55 + 17 units × $57) ÷ (11 units + 15 units + 21 units + 17 units)

= ($561 + $795 + $1,155 + $969 ) ÷ (64 units)

= ($3,480) ÷ (64 units)

= $54.375 per unit

Now the ending inventory units would be

= Available units for sale - sale units

= 64 units - 21 units

= 43 units

Now the ending inventory would be

= Ending inventory units × average cost per unit

= 43 units × $54.375 per unit

= $2,338

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4 years ago
When a firm is given monopoly power, it loses its freedom of contract, and a governmental body is given the power to determine t
Pani-rosa [81]

Answer:

The government agency is providing basic and/or essential services that further deepen the interests of members of the public

Explanation:

The assertion that a firm with a monopoly power loses it freedom of contract is very true. Monopolies by its realities come with features that ultimately cater for the interests of the firm, instead of the consumers. One of these is charging an astronomical high price on a particular item of commodity, and not taking cognizance of the purchasing power of the public. A firm could to this, and ultimately get away because its the only delivering such services - the one with the enormous monopoly power. Here, there is no stiff competition among goods that may offer liberty of choices to ordinary consumers.

To mitigate these numerous power of monopolies, governmental body has been giving the power to regulate and maintain an oversight functions. They now determine the provisions of contracts. The main objective of government agency, thus, is to ensure a firm with a monopoly power considers the basic and essential interests of the members of the public - the end users. Here, members of the public are insulated from unnecesary exploitation by the monopolies.

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3 years ago
A firm purchases goods on credit worth $150. The same firm pays off $100 in old credit purchases. An investment is made via the
Oxana [17]

Answer:

A. $50 increase

Explanation:

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1. Operating activities: It includes those transactions which affect the working capital, and it records transactions of cash receipts and cash payments.

2. Investing activities: It records those activities which include purchase and sale of the fixed assets

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