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3 years ago

How does business generate income?

Business

1 answer:

Luden [163]3 years ago

4 0

Hai!

This depends on the Type of Business.

If it is a Selling Business, they sell stuff to Earn Profit.

If its a Free Online Website/Game. They earn money by either in game purchases or Web Site purchases.

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1. A new furnace for your small factory will cost $27,000 to install and will require ongoing maintenance expenditures of $1,500

Marina CMI [18]

Answer:

payback 3.29 years

NPV 87,158.55

Explanation:

PO 27,000

Cash flow saving Y1

2400 x 3.5 = 8,400

expenditures (1,500)

net savings 6,900

Cash flow saving Y2

The price will increase 0.5

6,900 + 2,400 x 0.5 = 8,100

Cash flow saving Y3 to Y20

The price will increase 0.5

8,100 + 2,400 x 0.5 = 9,300

We have an annuity of 18 years for 9,300 cash

And then we have a cash flow of 6,900

and another of 8,100

$C \times \frac{1-(1+r)^{-time} }{rate} = PV\\$

C = 9,300

r = 8%

time = 18

$9,300 \times \frac{1-(1+0.08)^{-18} }{0.08} = PV\\$

PV = 87,158.55

Now this values are years into the future, so we need to bring them to present day.

$\frac{Principal}{(1 + rate)^{time} } = PV$

year 1 principal 6,900

6,900/1.08 = 6,388.89

year 2 principal 8,100

$\frac{8,100}{(1 + 0.08)^{2} } = PV$

PV= 5,915.64

year 3 annuity 87,158.55

$\frac{87,158.55}{(1 + 0.08)^{3} } = PV$

PV= 69,189.27

cash flow - investment = net present value

69,189.27 + 5,915.64 + 6,388.89 - 27,000 = 54,493.8

The payback will be the time perdion when the project recovers it initial cost:

we first add the income from the irregular years and subtract from the investment

6,900 + 8,100 = 15,000

27,000 - 15,000 = 12,000

then we use the general formula investment/cash flow per year

12,000/9,300 = 1.29

the project need the first two years and then 1.29 years

2 + 1.29 = 3.29 years

6 0

3 years ago

The welding department supplies parts to the final assembly line. Management decides to implement a kanban system and has collec

const2013 [10]

Answer:

25 containers

Explanation:

The computation of the number of kanban containers required is shown below:

= (Lead time demand + Safety stock) ÷ Container size

where,

Lead time demand is

= 2,000 units × 4 days

= 8,000 units

Container size = 400 units

Safety Stock is

= 1 day × 2,000 units

= 2,000 units

So, the number of kanban containers required is

= (8,000 units + 2,000 units) ÷ (400 units)

= 25 containers

We simply applied the above formula

6 0

3 years ago

Production Budget Pasadena Candle Inc. projected sales of 64,000 candles for January. The estimated January 1 inventory is 2,600

icang [17]

Answer:

Production budget:

Projected sales= 64,000

Ending inventory= 7,000

Beginning inventory= (2,600)

Total= 68,400 units

Explanation:

Giving the following information:

Pasadena Candle Inc. projected sales of 64,000 candles for January. The estimated January 1 inventory is 2,600 units, and the desired January 31 inventory is 7,000 units.

Production budget= projected sales + ending inventory - beginning inventory

Production budget:

Projected sales= 64,000

Ending inventory= 7,000

Beginning inventory= (2,600)

Total= 68,400 units

3 0

3 years ago

Recording sales, returns, and discounts taken LO P2 Prepare journal entries to record each of the following sales transactions o

OLEGan [10]

Answer:

Apr. 1

Trade Receivable $6,600 (debit)

Sales Revenue $6,600 (credit)

Cost of Sales $3,960 (debit)

Merchandise $3,960 (credit)

Apr. 4

Sales Revenue $740 (debit)

Trade Receivable $740 (credit)

Merchandise $444 (debit)

Cost of Sales $444 (credit)

Apr. 8

Trade Receivable $2,800 (debit)

Sales Revenue $2,800 (credit)

Cost of Sales $1,960 (debit)

Merchandise $1,960 (credit)

Apr. 11

Cash $5,860 (debit)

Trade Receivable (credit)

Explanation:

Perpetual method of inventory keeps a record of cost of inventory after every sale.

Thus, for every sale transaction remember to recognize the Sales Revenue and the Cost of Sales that follow the sale.

For any returns, De-recognize the Sales Revenue - to the extend of the credit granted and also de-recognize the Cost of Sales to the extend of the value of Inventory returned.

4 0

3 years ago

A tile manufacturer has supplied the following data: Boxes of tiles produced and sold 520,000 Sales revenue $ 2,132,000 Variable

Greeley [361]

Answer:

vdf

Explanation:

vnfdhhddhehejejrjrjrjrjrjrrururrirjriririrkrkrkr

3 0

3 years ago