Answer:
D. Inventory levels are determined as the trade-off between losing the margin on additional sales and the costs of excess inventory.
Explanation:
Option B is wrong because net working capital = current assets - current liabilities, and inventory is a current asset.
Options A and C may or may not be true depending on the company's costs. Holding costs include storage costs, insurance, damaged goods or even spoilage. Depending on the industry, e.g. dairy products, they might be larger than financing costs. But for other industries, e.g. microchips, holding costs are probably much lower than financing costs (a lot of small but expensive goods).
Answer:
224 units of output per dollar of input
Explanation:
The computation is shown below:
Productivity measures = (Total units produced) ÷ (Total labor cost + Total equipment cost)
where,
Total units produced is
= 70,000 × 52 weeks in a year × 4 years
= $14,560,000
Total units produced
= $13,000 × 4 years
= $52,000
And, the cost of equipment is $13,000
So, the productivity measures is
= ($14,560,000) ÷ ($52,000 + $13,000)
= 224 units of output per dollar of input
Answer:
6%
Explanation:
Data provided as per question is as given below:-
Redeemed amount = $1,000
Sale value of Bond = $687.25
Number of year = 5
The computation of interest rate is as shown below:-
Interest rate = (Redeemed amount ÷ Sale value of bond) ^ (1 ÷ Number of Year) - 1
= (1,000 ÷ 747.25) ^ (1 ÷ 5) - 1
= (1.338) ^ (0.2) - 1
= 0.06
= 6%
Answer:
Sales revenue for $500
Explanation:
The journal entry is shown below:
Account receivable Dr $490
Credit card expense Dr $10
To Sales revenue $500
(Being the sale transaction is recorded)
The account receivable is computed below:
= Sales revenue - sales revenue × fee percentage given
= $500 - $500 × 2%
= $500 - $10
= $490
And, the credit card expense is
= Sales revenue × fee percentage given
= $500 × 2%
= $10