Answer:
The correct answer to the following question is $36,000.
Explanation:
Given information -
Units anticipated to be produced - 300,000 units
Variable cost - $150,000
Fixed cost - $600,000
Beginning inventory - 5000 units
Ending inventory - 7000 units
Income under absorption costing - $40,000
Now under the absorption costing, rate of fixed overhead cost per unit -
Fixed cost / Number of units produced
= $600,000 / 300,000
= $2
In April ( under absorption costing ), the amount of fixed manufacturing overhead cost that was still embedded in ending inventory but were not expense -
Fixed overhead rate per unit x number of units produced but not sold
= $2 x 2000 ( 7000 units - 5000 units )
= $4000
So when we calculate the operating cost under variable costing this fixed overhead cost wold be subtracted from total income -
$40,000 - $4000
= $36,000 .
A and D are the correct answer
Answer:
Positive Statements: 1st & 2nd ; Normative Statements: 3rd & 4th
Explanation:
Positive Economics is <u>objective</u> & <u>facts</u> based <u>actual</u> economic issue description , explaining verifiable phenomenas (causal relationships).
Normative Economics is <u>subjective</u> & opinion based conclusive <u>solutions</u> to economic issues, including '<u>ought to be</u>' unverifiable suggestions.
1. Lung cancer kills millions of people each year: reflects actual objective verifiable fact about an economic (health) issue.
2. Too many people smoke: denotes another actual objective variable fact connected to (potential cause of) the above economic (health) issue.
So , these two are Positive Statements.
3. If the government were to increase taxes on cigarettes, fewer people would smoke : Is subjective opinion based probable solution to the above economic (health) issue.
4. The government should increase taxes on cigarettes : Is an 'ought to' suggestion for an economic participant (govt) to solve the above economic (health) issue.
So , these two are Normative Statements
Answer:
Unit A has revenue of $27 billion and a profit of $6 billion. While its product is based on a new technology that is rapidly increasing in sales, the product currently lags the market share of competitors.
Explanation:
According to the BCG Matrix, question marks are business units that operate in rapidly growing markets but currently only possess a low market share.
This results in a lot of cash being consumed by the business unit, but also the possibility of high growth. It is called a question mark because it is uncertain if the business unit will be successful or not. This means that they are very risky investments.
An externality is internalized (a) if the person(s) or group that generated the externality incorporate into their own private cost-benefit calculations the external benefits (in the case of a positive externality) or the external costs (in the case of a negative externality) that third parties bear.
Explanation:
<u>Internalizing the externality means transferring the burden or the cost of a negative externality (like pollution or traffic congestion) to inside(i.e external to internal).</u>
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- <u>Internalization of externality can be done through taxes, property rights, tolls, and government subsidies.</u>
- <u>The only way of correcting an externalities is to "internalize" the third party cost involved but this market -driven approach is not feasible </u><u>if the true monetary values cannot be determined.</u>
An externality is internalized if the person(s) or group that generated the externality incorporate into their own private cost-benefit calculations the external benefits (in the case of a positive externality) or the external costs (in the case of a negative externality) that third parties bear.
