Given, Operating income = 7,200
Fixed expenses = 1800
Let the target sales be assumed to be X
Sales = 7200 + 1800 + 0.6*Sales
X = 7200 +1800 +0.6X
X-0.6X = 9000
0.4X =9000
X = 22,500
Target Sales = 22,500
Break even point = Fixed Costs/(Price -Variable cost)
Break even point = 1,800/(1-0.6) = 1,800/0.4 = 4,500
Break even point =4,500
Margin of Safety = (Target sales - break even point)/ Target Sales
Margin of Safety = (22,500-4,500)/22,500 = 18,000/22,500 = 0.8 = 80%
Margin of Safety =80%
Answer:
Explanation: c. You buy an Audi sedan because the CEO of your company drives one.
e. You buy a ticket to a movie you’ve already seen because people you work with are going to the movie
Answer:
c. increase of $300,000
Explanation:
The autorized shares do not increase the equity of the firm. The firm generaes equity when the shares are issued. Therefore, we should consider January 2nd issuance:
12,000 common shares x $25 = 300,000 total proceeds
face value: 12,000 common x $5 = 60,000 face value
additional paid-in 240, 000
Answer:
The amount of money the buyer deposits when they buy
Explanation:
Earnest money is the money a buyer pays to a seller which is usually like a deposit when they are purchasing a property to show how serious they are in purchasing the property.
When the seller gets the earnest money from the buyer, he is rest assured that the buyer is willing to purchase the property, so he gives him enough time to rally around to get the balance while he list the property off the sales market.
Without earnest money, most sellers are probably going to sell their properties to customer who brings money first.
