Answer:
The correct answers are letters "A", "B", and "C": straight-line depreciation, manager's salary, store rent.
Explanation:
Fixed Costs are business expenses that do not change as the level of production goes up or down. They are one of two types of business expenses the other being variable cost. Variable costs do change as the volume of production changes. Examples of fixed costs are high-executive salaries, rent, depreciation, and insurance. Examples of variables costs are commissions, raw materials, and transportation fees.
Answer:
A) $56.5
Explanation:
Data:
Project S
Initial cost $10,000
Y1 CF = $6,000
y2 CF = $8,000
Project L
Initial Investment = $10,000
Y1-Y4 CF = $4,373
Solution:
<u>For Project S</u>
We shall prolong the project to four years so it can be easily compared to project L
Following shall be the cashflow stream:
Y0=-$10,000 Y1=$6,000 Y2=-$2,000($8,000 CF - $10,000 outlay for prolonging the project second time) Y3=$6,000 Y4=$8,000
Now to discount the cashflow


<u>For Project L</u>
In order to calculate present value of the annuity, following formula will be used:

<em>NPV = Initial outlay - PV</em>



Now, we can easily calculate how much value will the firm gain or lose if Project L is selected over Project S



<em>*all figures are rounded off to two decimal points*</em>
Answer:
$21.67
Explanation:
Exhibit 21-3 is attached with the answer .Please find it.
Total cost of production includes the fixed cost and variable cost. Fixed Cost remains constant as $500 in the exhibit, but the variable cost changes with each production level.
Cost of producing 60 units
Variable cost = $800
Fixed cost = $500
Total cost = $800+500 = $1,300
Product cost per unit = Total cost / numbers of unit = $1,300 / 60 = $21.67
Answer: 15.35%
Explanation:
The total nominal return over the two years if inflation is 2.4% in the first year and 4.4% in the second year will be calculated thus:
= (1+Interest rate)² -1
= (1 + 7.4%) - 1
= (1 + 0.074)² - 1
= 1.074² - 1
= 1.153476 - 1
= 0.153476
= 15.35% over the two years
The sales goals. That's it