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3 years ago

In the lease versus buy decision, leasing is often preferable

Business

1 answer:

lina2011 [118]3 years ago

7 0

Answer:

The correct answer is b) because the lessee may have greater flexibility in abandoning the project in which the leased property is used than if the lessee bought and owned the asset.

Explanation:

A clear example of the previous statement is when, for work reasons, for pleasure, or because you want to change the environment; You want to change the house to a better or bigger one. However, it is not so easy, because the house where you currently live, you are the owner. And if you want to change of residence, you first have to rent or sell the house where you are living.

While if the house is leased, the last day of the month or depending on the contract, you can change of residence.

That's why leasing is considered better.

You might be interested in

Determining the price of goods should be done after calculating income and expenditure ??

Vera_Pavlovna [14]

Answer:

False

Explanation:

There are several methods that businesses use to determine the price of goods and services. The most common one involves first calculating the cost of production or the cost of goods sold. The desired markup is added to the cost. Other methods include the break-even analysis, target prices, and going by the market rate.

In all these methods, the price is determined selling starts. It means the price is set before selling starts. Therefore, income cannot be generated before a price is determined.

3 0

3 years ago

What is the standard deviation of the returns on a stock given the following information? State of Economy Probability of State

Llana [10]

Answer:

3.28%

Explanation:

Calculation for the standard deviation of the returns on a stock

The first step is to find the Expected rate of return using this formula

Expected Return = E[R] = p1*R1 + p2*R2 + p3*R3

Let plug in the formula

Expected Return= 0.28*0.175 + 0.67*0.128 + 0.05*0.026

Expected Return = 0.049 + 0.08576 + 0.0013

Expected Return= 0.13606

Second step is to find the Variance using this formula

Variance = σ2 = p1*(R1-E[R])2 + p2*(R2-E[R])2 + p3*(R3-E[R])2

Let plug in the formula

Variance = σ2 = 0.28*(0.175-0.13606)2 + 0.67*(0.128-0.13606)2 + 0.05*(0.026-0.13606)2

Variance = 0.000424570608 + 0.0000435256119999998 + 0.00060566018

Variance= 0.0010737564

Last step is to find Standard Deviation of the returns on a stock

Note that the Standard Deviation is square-root of variance

Using this formula

Standard Deviation =√Variance

Let plug in the formula

Standard Deviation = σ =√ (0.0010737564)

Standard Deviation= 0.032768222411*100

Standard Deviation= 3.2768222411%

Standard Deviation =3.28% Approximately

Therefore the standard deviation of the returns on a stock will be 3.28%

4 0

4 years ago

Which of the following is the formula for break-even point in sales dollars? A : Fixed costs divided by contribution margin rati

ruslelena [56]

Answer:

B. Fixed costs divided by unit contribution margin

Explanation:

In sales dollars, Break-Even point = Fixed Costs ÷ Contribution Margin.

Break-Even point in (units) = Fixed Costs / (Sales price per unit - Variable costs per unit).

The Break even point is a measure of which a company can determine if when the product its manufactured or produced will start to be profitable.

8 0

3 years ago

Customers around the world know Pepsi and consider it a primary "go-to" brand if they want a refreshing drink. This positioning

Sedbober [7]

Answer:

B. targeting strategy and marketing mix

Explanation:

In business, Targeting strategy refers to a strategy that a company implemented to sell their product to specific group of consumers.

In pepsi's case, they focus their targeting strategy toward the consumers who want a refreshing drink.

Marketing mix is a marketing strategy that is revolved around product, price, place, and promotion. Companies could utilzie this 4 factors to create a business model that can make their targeting strategy succesful.

In pepsi's case:

They sold their product in almost every convenience store (place) . Making it easier for consumers who currently crave refreshing drinks. The price of Pepsi's product is very affordable.

They designed and promote their product to obtain a reputation as refreshing a product that can relinquish your thirst. You can see it in most of their advertising. Most of it consist of people in a hot weather that craves something cold and refreshing.

8 0

3 years ago

Green Corporation has total sales revenues of $400,000. If its total fixed costs are $70,000 and its total variable costs are $1

Georgia [21]

Answer:

Part 1

the contribution margin is $220,000

Part 2

the net change in operating income is $270,000

Part 3

Stanley's Bicycles contribution margin is $7,500

Explanation:

Green Corporation Contribution Margin Statement

Sales revenues $400,000

Less Variable costs ($180,000)

Contribution $220,000

Less Fixed Cost ($70,000)

Net Income $150,000

Frost Company Contribution Margin Statement

Contribution ($49 x 10,000) $490,000

Less Fixed Cost ($70,000)

Net Income $420,000

Change = $420,000 - $150,000 = $270,000

Stanley's Bicycles Contribution Margin Statement

Sales Revenue ($750 x 200) $150,000

Less Variable Costs :

Cost of Sales ( $600 x 200) ($120,000)

Commission ($150,000 x 15%) ($22,500)

Contribution $7,500

Less Fixed Costs

Rent expense ($1,400)

Salaries ($3,000)

Net Income $3,100

8 0

3 years ago