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Jobisdone [24]
3 years ago
12

Butler Automotive developed a new diagnostic testing procedure that is expected to increase sales by $10,000 per month. As more

drivers bring in their vehicles, Butler expects to also do more oil changes and brake repairs. As a result, inventory levels of oil and brake parts must be increased by $5,000. Revenues from oil changes and brake jobs are expected to increase by $4,000 per month. An example of an increase in net working capital requirements from the new diagnostic testing procedure is the
A) increase in inventory levels of oil and brake parts of $5,000.
B) increase in revenue of $10,000 per month for the diagnostic testing.
C) increase in revenues from oil changes and brake jobs of $4,000 per month.
D) increase in all activities totaling $19,000 per month.
Business
1 answer:
Bas_tet [7]3 years ago
6 0

Answer:

A

Explanation:

Working capital are the components of the current assets that represents liquidity , readily available for day to day business operation.

It is made up of cash , receivable , payable , inventory balance .

Due to the new development in the business of Butler automotive , there is an upsurge in the demand for oil which has led to the increase in the oil inventory to the tune of $5,000

This means that the required working capital of Butler also has to increase to meet up with the demand.

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snow_lady [41]
Preliminary calculations:3 units of A at $ 55.00 each - $ 165.004 units of B at $ 30.50 each - $ 122.001 unit of C at $ 32.00 each - $ 32.00Selling price of a composite unit - $ 319.00
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(a) Break-even point in composite units = $ 67,200 / $ 100 = 672 composite unitsBreak-even point in sales dollars = 672 x $ 319 = $ 214,368.00
(b) At break-even point,672 x 3 = 2,016 units of A672 x 4 = 2,688 units of B672 x 1 = 672 units of C
7 0
3 years ago
: Narda Corporation agreed to sell all of its capital stock to Effie Corporation for three monthly payments of $200,000. After E
Gnoma [55]

Answer:

Since Effie Corporation forfeited their stock subscription, then they will lose their stocks and the money they invested in Narda Corporation.

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3 years ago
Mickey is a 12-year-old dialysis patient. Three times a week for the entire year he and his mother, Sue, drive 20 miles one way
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Answer:

The right approach will be "$ 1123.2".

Explanation:

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