Answer:
1986 is the base year. so, the CPI of the base year is always 100%.
Option A
The value of $100 in 1993 would be = ($100/CPI of 1986) * CPI of 1993
= ($100/100) * 135
= $135
So, Option A is true.
Option B
$100 in 1992 would have been worth in 1986: ($100/CPI of 1992) * CPI of 1986
= ($100/120) * 100
= $83.33
So, Option B is false.
Option C
$100 in 1991 would have been worth in 1986: ($100/CPI of 1991) * CPI of 1986
= ($100/110) * 100
= $90.91
So, Option C is false.
Option D
The value of $100 in 1992 would be: ($100/CPI of 1993) * CPI of 1992
= ($100/135 * 120
= $88.89
So, Option D is false.
Answer:
$0
Explanation:
Alamos Co. exchanged equipments and $18,200 cash for a similar equipment
The book value of the old equipment is $81,100
The fair value of the old equipment is $91,900
The gain/loss recorded by Alamos can be calculated as follows
= Fair value-book value
= $91,900-$81,100
= $10,800
= $10,800
But since the exchange lacks a commercial substance then, no amount of gain or loss will be recognized/recorded.
Hence Alamos Corporation recorded a gain of $0
Answer: Schlictor's operating leverage when 2000 units are sold is 3.
The degree of operating leverage is used to calculate the change in operating income with respect to a percentage change in sales.
We can calculate operating leverage of a firm with the help of the following formula:
Substituting the values from the question we get
![Degree of operating leverage = \frac{(50 * 2000) - (50*0.40*2000)}{[50*2000] - [(50*0.4*2000) + 40000]}](https://tex.z-dn.net/?f=Degree%20of%20operating%20leverage%20%3D%20%5Cfrac%7B%2850%20%2A%202000%29%20-%20%2850%2A0.40%2A2000%29%7D%7B%5B50%2A2000%5D%20-%20%5B%2850%2A0.4%2A2000%29%20%2B%2040000%5D%7D)
![Degree of operating leverage = \frac{100000 - 40000}{[100000] - [(40000) + 40000]}](https://tex.z-dn.net/?f=Degree%20of%20operating%20leverage%20%3D%20%5Cfrac%7B100000%20-%2040000%7D%7B%5B100000%5D%20-%20%5B%2840000%29%20%2B%2040000%5D%7D)
Answer:
17.64%
Explanation:
Precision aviation has a profit margin of 7%
The total assets turnover is 1.4
The equity multiplier is 1.8
Therefore the ROE can be calculated as follows
= Total assets turnover × equity multiplier × profit margin
= 1.4 × 1.8 × 7
= 17.64%
Hence the ROE is 17.64%
If the price of labor falls, the supply of goods rises and the prices of those goods fall.
If labor costs go down, it will cost less for a business to make products so they will make more and supply will go up. When supply goes up, prices tend to fall.
