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Ivenika [448]
3 years ago
10

Knowledge Check 01 Addison Corporation is considering the purchase of equipment that would increase sales revenues by $250,000 p

er year and cash operating expenses by $100,000 per year. The equipment would cost $400,000 and have a 5-year life with no salvage value. The simple rate of return on the investment is closest to
A. 17.5%
B. 20.0%
C. 25.5%
D. 35.0%
Business
1 answer:
Flauer [41]3 years ago
8 0

Answer:

C. 25.5%

Explanation:

Net operating cashflow = (250,000 - 100,000) = 150,000; This is a recurring cashflow; the PMT

Cost of equipment; the PV = 400,000

Next, calculate the rate of return  using Net operating cashflow per year and the equipment cost. You can do this with a financial calculator;

N =5

PMT = 150,000

FV = 0

PV = -400,000

then CPT I/Y = 25.41%

Therefore the return is closest to 25.5%

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ivann1987 [24]

Answer:

Dentist is an occupation related to dental/tooth disease.

Explanation:

It is an occupation related to dentistry which is in the field of health.

7 0
1 year ago
Addison Co. budgets production of 2,790 units during the second quarter. Other information is as follows: Direct labor Each fini
Doss [256]

Answer and Explanation:

1. The preparation of direct labor budget is given below:-

Direct labor budget

Units to be produced              2,790

Hours required per unit          5

Total labor hours needed 13,950

(2,790 × 5)

Labor rate per hour                $10

Direct labor budget               $139,500

(13,950 × $10)

2. The preparation of factory overhead budget is given below:-

Total labor hours needed                 13,950

Variable overhead rate per hour       $12

Budgeted variable overheads           $167,400

(13,950 × $12)

Budgeted Fixed overheads              $580,000

Budgeted total overheads                $747,400

8 0
3 years ago
For each decision, state whether the company is following a cost leadership or a product differentiation strategy.
Oxana [17]

The strategies the companies are following in each case are;

1)Cost leadership  strategy

2)Product differentiation strategy

3) Product differentiation strategy

4) Cost leadership strategy

<h3>What Is Cost Leadership Strategy? </h3>

Cost leadership is known to be a kind of a business-level methods that is often used by people or by companies who are interested to gain a competitive advantage by acting as the  lowest-cost producer of a product, service, production process, or others.

Therefore,  The strategies the companies are following in each case are;

1)Cost leadership  strategy

2)Product differentiation strategy

3) Product differentiation strategy

4) Cost leadership strategy

Learn more about Cost leadership  strategy from

brainly.com/question/14395542

#SPJ1

4 0
1 year ago
Where can aspiring entrepreneurs go to get their questions answered?
Nataliya [291]
Aspiring entrepreneurs can go to the internet, experienced entrepreneurs, Chambers of Commerce, Small Businessn Administration (SBA), college/university, or the community to get their questions answered. Hope this helps.
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3 years ago
Ethan uses the cash method of accounting and a calendar year. ethan received a check from a client on december 26, 2016. he didn
Volgvan
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6 0
3 years ago
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