A company's new business is said to possess "synergy" with the company's existing business when ____

1 answer:

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Answer: the correct answer is (B) the diversification effort results in 1 + 1 = 3 benefits that enable the new business and the existing business to perform better as part of the same diversified firm than they would each perform operating as an independent, stand-alone business.

Explanation: the result of synergy has to be a win win situation in which new business and existing business work as a perfect machine to obtain the best output possible for all members of the organization.

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Kim Inc. is considering the replacement of a piece of equipment with a newer model. The following data has been collected: Old E

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Answer:

Kim Inc.

The net advantage (disadvantage) of replacing the old equipment with the new equipment is:

= $7,500.

Explanation:

a) Data and Calculations:

Old Equipment New Equipment

Purchase price $262,500 $450,000

Accumulated depreciation 95,000 0

Annual operating costs 300,000 245,000

Total operating costs for 10 years 3,000,000 2,450,000

Salvage 92,500 0

Total incremental cost $2,907,500 $2,900,000

b) The net advantage obtained by Kim for replacing the old equipment with the new equipment is $7,500 ($2,907,500 - $2,900,000). Note that the purchase price of the old equipment with its accumulated depreciation are not relevant costs. This case is worked out without taking into account the time value of money. Assuming that the present value of the cash flows was computed, a different result and conclusion would be reached.

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An outside supplier offers to provide Factor with all the units it needs at $44.45 per unit. If Factor buys from the supplier, t

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Answer:

Factor must opt to agree as well as purchase the deal from the provider. A further explanation is provided below.

Explanation:

The given problem seems to be incomplete. Find the attachment of the complete question below.

Given:

Direct material,

= $8.70

Direct labor,