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Alex17521 [72]
3 years ago
10

Gourmet Pets is interested in computing the break-even point for its new product Prime Cuts. The fixed costs of adding this prod

uct to the product line amounts to $20,000. Variable costs to produce one package of Prime Cuts are $2. Prime Cuts will sell for $6 per package. The break-even point would be:
A. 900 units.
B. 2,800 units.
C. 5,000 units.
Business
1 answer:
EleoNora [17]3 years ago
5 0

Answer:

C. 5,000 units

Explanation:

The break-even point is the number of units Gourmet Pets needs to sell to outweigh the fixed costs plus the production costs. Let 'x' be the number of Prime Cuts units sold, the expression that models the balance for Prime Cuts is:

B = -20,000 - 2x +6x

In order to break even, the balance must be equal to or greater than zero:

0 = -20,000 - 2x +6x\\x= \frac{20,000}{4} \\x=5,000

The break-even point would be 5,000 units.

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Which do you​ prefer: a bank account that pays 5 %5% per year​ (EAR) for three years​ or: a. An account that pays 2.5 %2.5% ever
Kobotan [32]

Answer:

c. An account that pays 0.5 %0.5% per month for three​ years.

Explanation:

We can evaluate all the option using following formula:

EAR = ( 1 + ( r / m ) )^m -1

a.

2.5% every six months for three years

r= 2.5% = 0.025 / 6 =

m = 12/6 = 2

EAR = ( 1 + 0.025  )^2 -1

EAR = 0.050625 = 5.06%

7.5% every 18 months for three years

r= 7.5% for 1.5 years = 7.5% / 18 = 0.4167% per month = 0.004167 per month

EAR = ( 1 + 0.004167 )^12 -1

EAR = 0.051166 = 5.12%

0.5% every month for three years

r= 0.5% = 0.005

EAR = ( 1 + 0.005 )^12 -1

EAR = 0.0616778 = 6.17%

We will prefer an account that pays 0.5 %0.5% per month for three​ years, it pays the highest return.

6 0
3 years ago
Tetious Dimensions is introducing a new product and has an expected change in net operating income of $790,000. Tetious Dimensio
saveliy_v [14]

Answer:

$620,000

Explanation:

to determine the net cash flow generated by the project, we can use the indirect method to determine cash flows:

net income = $790,000 x (1 - 30%) =               $553,000

net income adjustments:

  • depreciation expense                              $190,000
  • increase in accounts payable                   $42,000
  • increase in accounts receivable             ($79,000)
  • increase in inventory                              <u>  ($86,000) </u>

Project's cash flow                                           $620,000

                                       Without the          With the         change

                                       project                  project

Accounts receivable     $5,000                  $84,000        $79,000

Inventory                     $98,000                 $184,000        $86,000

Accounts payable       $75,000                  $117,000        $42,000

6 0
3 years ago
An unmanned instrumented spacecraft designed for the acquisition of scientific data carried out in a space environment is called
Nitella [24]

A space probe is an unmanned instrumented spacecraft that is designed to execute physical studies of space environment. It is rocketed into space with enough speed to achieve the velocity needed to obtain hyperbolic orbit and also to reach a trajectory that is aimed at a pre-selected target. 

<span> </span>

8 0
3 years ago
On February 20, services valued at $60,000 relating to the organization of a corporation were performed in exchange for 1,000 sh
Ganezh [65]

Answer:

Explanation:

The journal entry is shown below:

On February 20

Organization expense A/c Dr     $60,000

          To  Common Stock A/c $25,000       (1,000 shares × $25)

          To  Paid in capital in excess of par-Common Stock $35,000

(Being the organization expense is recorded and remaining balance is credited to the  Paid in capital in excess of par-Common Stock)

3 0
3 years ago
Janet Foster bought a computer and printer at Computerland. The printer had a $900 list price with a $100 trade discount and 2/1
nikdorinn [45]

Answer:

Janet Foster

a. Janet could save $12.44 on the printer by borrowing $800 to take advantage of the cash discount.

b. On the computer, the difference in the final payment between choices 1 and 2 is $197.

It is advisable for Janet to choose the first option.

Explanation:

a) Data and Calculations:

Printer:

List price of printer = $900

Trade discount =          100

Purchase cost =        $800

Cash discount terms = 2/10, n/30

Cash discount = $16 ($800 * 2%)

Interest on loan to purchase printer = $3.56 ($800 * 8% * 20/360)

Savings if loan is borrowed = $12.44 ($16 - $3.56)

Computer:

List price = $4,060

Trade discount = 25% or $1,015 ($4,060 * 25%)

Purchase cost = $3,045

Payment options:

1) = $160 * 17 months = $2,720

Balance on 18th month    325

Total payment =           $3,045

2) = Payment with 8% interest for 18 months equal payment = $180.08

From an online financial calculator:

N (# of periods)  18

I/Y (Interest per year)  8

PV (Present Value)   $3,045

FV (Future Value)  0

P/Y (# of periods per year)  12

C/Y (# of times interest compound per year)  12

PMT made at the end of each period

Results

PMT = $180.08

Sum of all periodic payments $3,241.48

Total Interest $196.48

Difference in final payment:

Choice 1 , total payment =    $3,045

Choice 2, total payment =    $3,242

Difference in final payment = $197

6 0
2 years ago
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