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o-na [289]
2 years ago
8

EB11.

Business
1 answer:
GarryVolchara [31]2 years ago
5 0

Answer:

Using High and Low Method  

                            Cost    Miles

                              $

High                     1,250    4,000

Low                      <u>(970) </u>    <u>(3,000)</u>

                            <u> 280 </u>     <u>1,000</u>

Variable cost per mile = $2,800/1,000

                                       =$0.28 per mile                

Explanation:

In this question, there is need to obtain the difference with the highest cost and lowest cost. We also need to calculate the difference between                                                                                                                                                                                                     the highest miles and lowest miles. Finally, we will divide the difference in cost by the difference in miles in order to determine the variable cost per mile.                                                                                                                                                                    

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a. Describe how the payback period is calculated and describe the information this measure provides about a sequence of cash flo
saw5 [17]

Answer:

While taking a capital budgeting decision of source of fund, or the capital project to be chosen, we sometimes use Payback Period

It is defined as the tenure in which the cash flows will realize the cost of project, that is the period in which the entire cost will be paid back.

This provides the information regarding the time after which the project will be profitable, or the time at which it will reach break even.

The payback uses the criteria that if the payback period calculated is less than life of project it shall be accepted, in case it is equal to life of project then  there will be no profit no loss, and in case payback is higher than life of project then there will be loss.  

7 0
3 years ago
What is a short term benefit for a company to regulary keeping wages low
Tcecarenko [31]
The answer would be that the company can keep costs too a minimum.  
3 0
3 years ago
Read 2 more answers
You are thinking about a project to expand your business. In order to start the project, you have to invest $200,000 in new equi
svetlana [45]

Answer:

The initial outlay of this project is $270,000

Explanation:

According to the given data we have the following:

cost of new machine= $200,000

shipping cost=$5,000

installation cost=$15,000

working capital=$50,000

Therefore, in order to calculate the initial outlay of this project we would have to make the following calculation:

initial outlay of this project=cost of new machine+shipping cost+installation cost+working capital

initial outlay of this project= $200,000+$5,000+$15,000+$50,000

initial outlay of this project= $270,000

7 0
3 years ago
Estrada Corporation produced 300,000 watches that it sold for $35 each. The company determined that fixed manufacturing cost per
Advocard [28]

Answer:

Variable cost per unit = $12

The total variable cost = $3,600,000

The total contribution margin = $6,900,000

Explanation:

Number of units produced = 300,000

Selling cost = $35

Revenue = 300,000 × $35

               = $10,500,000

Fixed cost = $14 per unit

Total fixed cost = 300,000 × $14

                          = $4,200,000

Gross margin = $2,700,000

Gross margin is the difference between the Revenue earned and the total cost.

Total cost = $10,500,000 - $2,700,000

                 = $7,800,000

Total cost = Total Fixed cost + Total variable cost

Total variable cost = $7,800,000 - $4,200,000

                               = $3,600,000

Variable cost per unit is the ratio of the total variable cost to the number of units produced.

Variable cost per unit = $3,600,000/300000

                                    = $12

Total contribution margin is the difference between the total revenue and the total variable cost.

Total contribution margin = Total revenue - Total variable cost

                                           = $10,500,000 - $3,600,000

                                           = $6,900,000

4 0
3 years ago
Buffalo Corporation issues $630,000 of 9% bonds, due in 11 years, with interest payable semiannually. At the time of issue, the
katen-ka-za [31]

Answer:

the issue price of the bonds is $593,177

Explanation:

The computation of the issue price of the bonds is shown below:

Particulars                  Amount          PV factorat 5%      Present value

Semi-annual interest $28,350              11.68959              $331,400

Principal                     $630,000            0.41552               $261,778

Total                                                                                     $593,177

hence, the issue price of the bonds is $593,177

6 0
3 years ago
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