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3 years ago

Which of the following statements is correct about the connection between cost centers and revenue?

Business

1 answer:

Mazyrski [523]3 years ago

8 0

Answer:

B) Cost centers do not directly generate revenue from customers, but they may have an impact on revenue through customer satisfaction and overall quality.

Explanation:

Cost Centers are functions where costs are accumulated.

Cost centers do not generate revenue, but they do have impact on revenue since price determination lies on the cost if the company is to make profit.

Costs also determine the quality of the final product to customer and the satisfaction there-off - which are vital for driving revenue.

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Brokerage firms make their profits primarily in which of the following ways? A) Consumer deposits. B) Government deposits. C) Di

Anastasy [175]

Brokerage firms make their profits primarily in : D. Fees commissions on sales or transfers

to put it simply, A brokerage firm is a financial institution that facilitates the selling process of stock/securities between the buyer and the seller. From each transaction that happen, a brokerage firm will receive a commission from its client.

hope this helps

5 0

3 years ago

Read 2 more answers

On January 1, 2021, the company obtained a $3 million loan with a 14% interest rate. The building was completed on September 30,

Svet_ta [14]

Answer:

1. Calculate the amount of interest that Mason should capitalize in 2021 and 2022 using the weighted-average method.

interest capitalized in 2021 = $166,189

interest capitalized in 2022 = $77,956

2. What is the total cost of the building?

total construction costs ($6,375,000) + capitalized interests ($244,145) = $6,619,145

3. Calculate the amount of interest expense that will appear in the 2021 and 2022 income statements.

interest expense 2021 = $1,148,000 - $166,189 = $981,811

interest expense 2022 = $1,148,000 - $77,956 = $1,070,044

Explanation:

a 14%, $3,000,000 loan obtained on January 1, 2021

building was completed on September 30,2022

January 1, 2021: $1,050,000 x 12/12 = $1,050,000

March 1, 2021: $870,000 x 10/12 = $725,000

June 30, 2021: $390,000 x 6/12 = $195,000

October 1, 2021: $690,000 x 3/12 = $172,500

total weighted average expense 2021 = $2,142,500

weighted average interest rate:

$3,000,000 x 14% = $420,000

$4,900,000 x 5% = $245,000

$6,900,000 x 7% = $483,000

average interest rate = $1,148,000 / $14,800,000 = 7.7568%

interest capitalized in 2021 = $2,142,500 x 7.7568% = $166,189

January 31, 2022: $675,000 x 8/9 = $600,000

April 30, 2022: $990,000 x 5/9 = $550,000

August 31, 2022: $1,710,000 x 1/9 = $190,000

total weighted average expense 2021 = $1,340,000

weighted average interest rate:

$3,000,000 x 14% = $420,000

$4,900,000 x 5% = $245,000

$6,900,000 x 7% = $483,000

average interest rate = $1,148,000 / $14,800,000 = 7.7568%

interest capitalized in 2022 = $1,340,000 x 7.7568% x 9/12 = $77,956

4 0

3 years ago

Center Chemical Company's Industrial Division makes 400,000 gallons of rubbing alcohol each year and has enough capacity to manu

Fittoniya [83]

Answer:

cost-based transfer pricing

Explanation:

If the firm uses negociated rtansfer pricing they will stablish the transfer price based on manager bargain skill and leverage of each division. The CEO will not a grip on controlling cost across all dvisions, the managers will.

Therefore the best option is to go with a cost-based transfer pricing. The CEO can determinatethe method to determinate the cost and indriectly the cost across all divisions.

5 0

3 years ago

A firm sells a product in a purely competitive market. The marginal cost of the product at the current output of 200 units is $4

Eddi Din [679]

Answer:

The correct answer is option B.

Explanation:

A firm sells a product in a purely competitive market.

The marginal cost of the product at the current output of 200 units is $4.00.

The average variable cost is $3.50.

The market price of the product is $3.00.

The market price is not covering the average variable cost. In this situation, the firm must be incurring losses. To minimize losses the firm should produce less than 1,000 units at the point where marginal cost is equal to market price and the average variable cost is being covered.

6 0

3 years ago

An establishment has three departments with variable costs as a percentage of sales revenue of 30 percent, 40 percent, and 50 pe

zalisa [80]

Answer:

60 percent

Explanation:

Contribution margin refers to the revenue a firm derives after deducting the variable cost it has incurred.

Contribution margin = Sales - Variable costs

Contribution margin or contribution to sales ratio represents the percentage of contribution a firm earns from the sale of it's output.

It is represented mathematically as,

= $\frac{Contribution\ margin}{Sales}$

Also, contribution margin ratio = 100 - variable cost ratio percentage.

Hence, contribution margin for three departments would be:

A = 100 - 30% = 70%

B = 100 - 40% = 60%

C = 100- 50% = 50%

This represents if sales revenue is 100, contribution margin earned is 70, 60 and 50 under three cases.

Since sales revenue in all three departments is the same, let us assume the sales revenue of a department as y.

$\frac{0.70y\ +\ 0.60y\ +\ 0.50y}{3y}$

Thus, weighted average contribution margin would be, 60 percent

7 0

2 years ago