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Lapatulllka [165]
3 years ago
12

On March 15, a fire destroyed Interlock Company's entire retail inventory. The inventory on hand as of January 1 totaled $4,950,

000. From January 1 through the time of the fire, the company made purchases of $2,049,000, incurred freight-in of $234,000, and had sales of $3,630,000. Assuming the rate of gross profit to selling price is 30%, what is the approximate value of the inventory that was destroyed?a. $6,144,000.b. $4,458,000.c. $4,692,000.d. $7,233,000.
Business
1 answer:
lana [24]3 years ago
6 0

Answer: Option (c) is correct.

Explanation:

Gross profit of 30% means that every $1 of Sales require $0.7 of inventory and cost of freight.

So, inventory used to generate sales of $3,630,000:

= $3,630,000 x 0.7

= $2,541,000

Total inventory during the period:

= Beginning inventory + Purchases

= $4,950,000 + $2,049,000

= $6,999,000

Remaining Inventory:

= (Total inventory - Inventory used to generate sales) + freight-in

= ($6,999,000 - $2,541,000) + $234,000

= $4,692,000

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The person can dress in 630 different ways according to permutation and combination.

<h3><u>What is permutation and combination?</u></h3>
  • Subsets of a set can be created in two separate ways: combination and permutation. The subset's components can be listed in any order when combined. The components of the subset are listed in a permutation in a certain order.
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First, The person has to decide on pants. So, he has 5 choices. And for each pant, the person has 7 shirts, 6 ties and 3 pair of shoes as choice. So,  5*7*6*3 = 630.

Know more about permutation and combination with the help of the given link:

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8 0
2 years ago
If the demand for a product decreases, we would expect a equilibrium price and equilibrium quantity to both decrease. b equilibr
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Answer:

a. Equilibrium price and equilibrium quantity to both decrease.

Explanation:

When the demand of a product decreases, it generates an excess supply at the initial price and this will generate the price to decrease. When the price goes down, suppliers are not willing to sell the same amount of products which will cause a decrease in the quantity.

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3 years ago
Canton Corp. produces a part using an expensive proprietary machine that can only be leased. The leasing company offers two cont
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Answer:

Explanation:

a)

1. Unit rate lease

Unit Contribution margin = Unit Selling price – Unit Variable cost

= 40 - 24 =  $16

Break even point (units) = Fixed cost/Contribution margin per unit

= 200,000/16  = 12,500

2. Flat rate lease

Unit Contribution margin = Unit Selling price – Unit Variable cost

= 40 - 20  = $20

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= 260,000/20  = 13,000

b.)

Let at X units produced profit margin is same under both the lease options

40X - 24X - 200,000 = 40X - 20X - 260,000

16X - 200,000 = 20X - 260,000

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X = 15,000

If 15,000 units are produced, profit margin will be same under both the lease options.

c)

1. Unit rate lease

Contribution margin income statement

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Variable cost (20,000 x 24)  - 480,000

Contribution margin  320,000

Fixed cost  - 200,000

Operating income  120,000

Operating leverage = Contribution margin/Operating income

= 320,000/120,000  = 2.67

2. Flat rate lease

Contribution margin income statement

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Variable cost (20,000 x 20)  - 400,000

Contribution margin  400,000

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Operating leverage = Contribution margin/Operating income

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d)

1. Unit rate lease

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= 20,000 x 40 - 12,500 x 40

= 800,000 - 500,000

= $300,000

Margin of safety (%) = Margin of safety/Actual sales

= 300,000/800,000  = 37.5%

2. Flat rate lease

Margin of safety = Actual sales - Break even sales

= 20,000 x 40 - 13,000 x 40

= 800,000 - 520,000

= $280,000

Margin of safety (%) = Margin of safety/Actual sales

= 280,000/800,000  

= 35%

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Inessa05 [86]
If the sellers pay the majority of the tax, then the supply is more inelastic than demand. 

If something is inelastic it is not sensitive to changes in the price or income of someone. The sellers will always have more of the tax burden when supply is more inelastic than demand and vis versa when demand is more inelastic than supply. 
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Answer:

It will be a violation of real estate law

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