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BartSMP [9]
3 years ago
8

Delta Company sells bells to customers for $1 each. The variable cost to manufacture the bells is 10 cents. If the rattle depart

ment, a division of the Delta Company, wants to use the bells in its new line of rattles, which of the following transfer prices can be used if there is excess capacity?
a. $0.00
b. $0.05
c. $0.11
d. $0.95
e. $1.50
f. $2.00
Business
1 answer:
kherson [118]3 years ago
3 0

Answer:

C. $0.11

Explanation:

When there is excess capacity and there are no incremental fixed costs the break even transfer price would be the marginal cost of production. This is the least transfer price the Bells can sell to Rattle without making a loss. The most likely transfer price then would be $0.11 which allows the bells to cover their costs and also make 1 cent in profits. Option A, B and D would all be making losses where as Option E and F are two steep a price and may be unprofitable for rattle.

Hope that helps.

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Consider a one-year project that costs $126,000, provides an income of $70,000 a year for 5 years, and costs $225,000 to dispose
Inessa [10]

Answer:

Present Value (PV) of cash flows are as follows.

(i) Discount rate = 0%

\mathrm{PV}(\mathrm{S})=-126,000+70,000 \mathrm{x} \mathrm{P} / \mathrm{A}(0 \%, 5)-225,000 \mathrm{x} \mathrm{P} / \mathrm{F}(0 \%, 5)=-126,000+70,000 \times 5-225,000

= - 1

Since PV < 0, the project should not be undertaken.

(ii) Discount rate = 2%

\mathrm{PV}(\mathrm{S})=-126,000+70,000 \mathrm{x} \mathrm{P} / \mathrm{A}(2 \%, 5)-225,000 \mathrm{x} \mathrm{P} / \mathrm{F}(2 \%, 5)

|=-126,000+70,000 \times 4.7135-225,000 \times 0.9057

= 156

Since PV > 0, the project should be undertaken.

(iii) Discount rate = 5%

\mathrm{PV}(\mathrm{S})=-126,000+70,000 \mathrm{x} \mathrm{P} / \mathrm{A}(5 \%, 5)-225,000 \mathrm{x} \mathrm{P} / \mathrm{F}(5 \%, 5)

=-126,000+70,000 \times 4.3295-225,000 \times 0.7835

= 772

Since PV > 0, the project should be undertaken.

(ii) Discount rate = 10%

\mathrm{PV}(\mathrm{S})=-126,000+70,000 \mathrm{x} \mathrm{P} / \mathrm{A}(10 \%, 5)-225,000 \mathrm{x} \mathrm{P} / \mathrm{F}(10 \%, 5)

=-126,000+70,000 \times 3.7908-225,000 \times 0.6209=-126,000+265,356-139,707

= - 351

Since PV < 0, the project should not be undertaken.

4 0
3 years ago
At December 31, Hawke Company reports the following results for its calendar year.
kodGreya [7K]

The adjusting entries for acknowledging the bad debts would be:

a). Bad Debts Expense                  $50 640

Allowance for Doubtful Accounts                     $50 640

b). Bad Debts Expense                 $48089.1

Allowance for Doubtful Accounts                     $48089.1

Bad debts:

  • Bad debts are described as debts that are unable to be recovered from their respective debtors.

The key reasons for this could be:

  • The debtor is bankrupt and cannot pay the amount.
  • The debtor flees away and thus, can't be compelled to pay.

The given amounts are obtained as follows:

a). Given that,

Bad debts is 1.5% of credit sales.

Credit Sales = $3,376,000

Bad debts = 1.5% of $3,376,000

∵ Bad debts = 1.5/100 * $3,376,000

= $50 640

b). Given that,

Bad debts = 1 % of total sales.

Total Sales = Credit sale + Cash sale

= $3,376,000 + $1,432,910

= $4808910

Bad debts = 1% of 4808910

∵ Bad debts = 1/100 * $4808910

= $48089.1

Learn more about 'Journal entries' here:

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3 years ago
Which leadership factor is defined as giving pep talks, asking employees for advice and praising their work, keeping them inform
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The leadership factor that is defined as giving pep talks, asking employees for advice is Motivating others.

<h3>What is Motivation?</h3>

Motivation serves as an act of giving energy to the components of the organization, it involves building up trust.

Therefore, motivation involves praising the work of employees and keeping them informed

Learn more about Motivation at;

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#SPJ1

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2 years ago
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Mkey [24]

Answer:

Q is 98

Explanation:

Marginal (average) cost (including opportunity cost) = $8 + $2 = $10

Profit is maximized when MR = MC = 10.

P = 402 - 2Q

Total revenue (TR) = P x Q = 402Q - 2Q^2

MR = dTR/dQ = 402 - 4Q

Equating with MC,

402 - 4Q = 10

4Q = 392

Q = 98

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Answer:

Database Marketing

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According to my research on the different marketing methods, I can say that based on the information provided within the question the best communication method for achieving her goals would be Database Marketing. This is because this type of marketing technique uses databases to choose the right individual market segments and delivering their marketing message through those channels with the people that are already part of those market segments.

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3 years ago
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