If it triples each time you will get 19683 pennies
Answer:
Operating profit using absorption costing will be higher by $3,600 than operating income if using variable costing.
Explanation:
<em>The difference between profit under variable costing and under absorption costing is simply the value of the change in inventory.
</em>
<em>Usually, a decrease in inventory would cause profit under absorption costing to be lower . This is so because cost of goods sold would become higher leading to a lower profit
. And vice versa</em>
<em>Difference in profit = POAR × change inventory
</em>
Predetermined Overhead absorption rate(POAR)
= Estimated overhead/ estimated production unit
= $24,000/2,000 units = $12 per unit
Change in inventory = 1500 - 1200= 300 units
Difference in profit = 300 × $12 per unit = $3,600
Operating profit using absorption costing will be higher by $3,600 than operating income if using variable costing.
Answer:
The inventory turnover for the period is 5
Explanation:
Inventory turnover is the ratio which stated that how many times the company replaces as well as sells the stock of goods during a specific year or period.
The formula for computing the inventory turnover is as:
Inventory turnover = Cost of goods sold / Average inventory
where
Cost of goods sold (COGS) = $9,070,000
Average inventory = $1,814,000
Putting the values above:
Inventory turnover = $9,070,000 / $1,814,000
Inventory turnover = 5
Answer: charge a monopoly price
Explanation:
Patents provide an exclusive right to the firm in the production and sale of a drug. This provides the firm exclusive market power to decide the price and the quantity and therefore the firm is able to charge a monopoly price and also earn monopoly profits.
When an existing patent expires and the generic producers enter the market, the price reduces due to an increase in the supply of the erstwhile patented drug. This will reduce the monopoly profit of incumbent producers. Therefore, they will seek to deter the entry of generic drug makers in order to safeguard their monopoly profits and price.
Therefore, incumbents were willing to give enough to potential entrants so as to make them delay entry to charge a monopoly price.
The effect of the 2013 Supreme Court decision allowing legal action against these companies is increase in the cost of pay-for-delay agreements and also reduce incumbent profits from these agreements.
