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2 years ago

Describe the term marginal cost?

Business

2 answers:

ohaa [14]2 years ago

8 0

Answer:

The cost of production is marginal. Fixed and variable costs included. With regard to fixed costs, this is only calculated at the marginal cost of production is to be expanded. In contrast, marginal costs always include variable costs.

Explanation:

THE IMPORTANCE OF MARGINAL COST:

In economics, marginal costs are important as they help companies to maximize profits. When marginal costs are equal to marginal income, we have so-called profit maximization. In this respect, the cost of producing a further product is exactly the same as the sales of the company. That is, the company does not make money at that point anymore.

As seen from the below marginal costs curve, marginal costs begin to decrease as the company benefits from scale savings. Marginal costs can however increase with businesses declining in productivity and suffering from scale disadvantages. Costs are increasing and they ultimately receive marginal income.

It could be because the company becomes too big and inefficient, or because the management problem gets less productive and demotivated. Whatever the reason, companies may have to face up to rising costs and stop production if their income is identical to the marginal price.

AURORKA [14]2 years ago

6 0

Answer:

In economics, the marginal cost of production is the change in total production cost that comes from making or producing one additional unit. To calculate marginal cost, divide the change in production costs by the change in quantity.

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Department S had no work in process at the beginning of the period. It added 13,600 units of direct materials during the period

lora16 [44]

Answer:

Cost of units completed = $176,528

Workings are attached:

Explanation:

Equivalent unit of production

An equivalent unit of production is an expression of the amount of work done by a manufacturer on units of output that are partially completed at the end of an accounting period. Basically the fully completed units and the partially completed units are expressed in terms of fully completed units.

Equivalent units are used in the production cost reports for the producing departments of manufacturers using a process costing system. Cost accounting textbooks are likely to present the cost calculations per equivalent unit of production under two cost flow assumptions: weighted-average and FIFO.

Conversion costs

Conversion costs is a term used in cost accounting that represents the combination of direct labor costs and manufacturing overhead costs. In other words, conversion costs are a manufacturer's product or production costs other than the cost of a product's direct materials.

Expressed another way, conversion costs are the manufacturing or production costs necessary to convert raw materials into products.

The term conversion costs often appears in the calculation of the cost of an equivalent unit in a process costing system.

For the sake of this question, we will be determining the equivalent units of production:

Units completed and transferred subject to material and conversion costs
Units in the closing inventory subject to material and conversion costs
We will then calculate the cost per units with respect to material and conversion costs for the equivalent units.
These cost per units will enable us to determine the cost of items completed.

Download xlsx

4 0

2 years ago

True or False: Marginal analysis involves comparing the additional or extra benefit derived from consuming an additional unit of

Likurg_2 [28]

Answer:

True

Explanation:

Marginal - the dictionary meaning of such word is additional of anything. Here, in the given case, marginal analysis as per costing is the analysis of each additional revenue from each additional sale or production.

Marginal analysis does not consider fixed cost generally, as that is fixed and don not add on on additional units, within a standard range.

Thus, the statement stated here is True.

7 0

2 years ago

Fresh Veggies, Inc. (FVI), purchases land and a warehouse for $550,000. In addition to the purchase price, FVI makes the followi

maw [93]

Answer:

Land 594,500

Explanation:

We must include all cost necessary to acquire the land and lelave it ready to use.

But, the demolition cost are associate with the old warehouse thus, as thsis asset is being destroyed It will be considered period cost, It will not be capitalized through land.

Acquisition cost 550,000

broker commission 35,000

title insurance 2,500

closing cost 7,000

Total cost 594,500

8 0

3 years ago

According to Walter Shewhart:_______

Novosadov [1.4K]

Answer:

c) the mean, upper control limit, lower control limit and warning lines that are two sigma from the mean are indicated by horizontal lines in the control chart.

Explanation:

Walter Shewhart is regarded as an important personality in the history of quality management. He asserted that the behavior of real processes had the tendency to change as time changed and it was not the behaviur of theoretical random distributions.

Walter Shewhart posited that causes of variation could be divided into two which are chance cause and assignable cause. He maintained that chance causes could be ignored if they did not cause too much variation, and any attempt to eliminate them usually made the problem worse. He however posited that it was possible to fix assignable causes.

Walter Shewhart invented control chart in order to differentiate between variations caused by random events and trends that indicated assignable causes. There is time and a plot of sample measurements on the bottom axis of a control chart. The mean, upper control limit, lower control limit, and warning lines that are two sigma from the mean are indicated by horizontal lines.

Based on the above explanatio, the correct option is c) the mean, upper control limit, lower control limit and warning lines that are two sigma from the mean are indicated by horizontal lines in the control chart.

8 0

3 years ago

The marketplace sets the price for wheat, so farmers who are trying to sell their wheat crops do not need a pricing strategy and

jek_recluse [69]

Answer:

The correct answer is option c.

Explanation:

The only kind of market structure where the price is set by market forces and not the firms is pure competition. The firms in other market structures such as oligopoly, monopoly and monopolistic competition are price setters.

The market for wheat is a pure competition as there is a large number of sellers who are producing identical products. The firms are price takers and the price is determined by market forces.

5 0

3 years ago

Describe the term marginal cost?​

Describe the term marginal cost?