you need ideas and concepts
Answer:
Year 1, Year 2 purchasing power = 8 , 9 (respectively). As price level fall, value of money<u> Increases </u>
Explanation:
Year one purchasing power = Money ($) / Price per basket = 72 / 9 = 8
Year two purchasing power = Money ($) / Price per basket = 72 / 8 = 9
This implies that, as price level falls (from 9 to 8 here) ,the value of money ie purchasing power increases (from 8 to 9)
Answer:
$281.67
Explanation:
Data provided in the question:
Current selling price of large TV = $380
Cost of Large TV = $310
Selling price of new TV = $340
Increase in sales = 20% = 0.20
Current sales = $150,000
Now,
Expected sales after reducing the price = Current sales + Increase in sales
= 150,000 + ( 0.20 × 150,000 )
= 150,000 + 30,000
= 180,000
Target Operating income = ( $380 - $310 ) × current sales
= $70 × 150,000
= $10,500,000
New operating cost per unit
= Target Operating income ÷ Expected sales after reducing the price
= $10,500,000 ÷ 180,000
or
New operating cost per unit = $58.33
Target Cost
= Price after reduction - New operating cost per unit
= $340 - $58.33
= $281.67
Answer:
B.
Explanation:
It shields the new owner of the property from losses that could result unexpected claim to the property by a third party.
Answer:
The firm paid taxes of $0.5 million
Explanation:
Profit margin is the percentage of net income to its sales. It is calculated as follow:
Profit Margin = ( Net profit / Sales ) x 100
20% = (Net profit / 5 million) x 100
(20/100) x 5 million = Net profit
Net profit = 1 million
EBIT is the earning before the payment of interest expense and tax. It is the net of Gross profit and operating expenses.
net income is calculates from EBIT as follow
Net Income = EBIT - Interest expense - Tax
1 = 1.5 - $0 - Tax (ignoring the effect of financing)
Tax = $1.5 - $1
Tax = $0.5 million
