Answer: a. The drone option should be chosen because it is the least expensive in terms of both fixed cost and variable cost.
b. A and 20000, B and 20000
Explanation:
a. From the information provided, the correct option is option B "The drone option should be chosen because it is the least expensive in terms of both fixed cost and variable cost".
This statement is wrong has the drone has the largest fixed cost and variable cost. It's fixed cost of $100,000 is more than that of $70,000 and $60,000 for others.
b. A and 20000, B and 20000
A is preferred at volumes below 20000 while B is preferred at volume above 20000.
Answer:
Total Material cost variance $5,600 favorable
Explanation:
<em>The direct matriculate total variance is he difference between the standard material cost for the actual output achieved and the actual material cost of the same output</em>
Standard materiel cost per unit = 0.25 × $30 = $7.5 per unit
$
5,000 units should have cost (5000× $7.5) = 37,500
but did cost (actual cost 1,000 × $29 <u> 31,900
</u>
Total Material cost variance <u> 5600</u> favorable
Answer:
B. Both I and II are true.
Explanation:
<em> The average total cost of a given level of output is the slope of the line from the origin to the total cost curve at that level of output</em>
The average total cost is defined as the sum of all total costs divided by the quantity produced. In other words, the cost of one unit of production. The average cost curve as shown in the diagram is U-shaped, where it falls with economies of scale and later rises as diseconomies of scale sets in.
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<em>The marginal cost of a given level of output is the slope of the line that is tangent to the total cost curve at that level of output</em>
Marginal cost is the change that occurs in the total cost when quantity produced increases by one unit. In other words, it is the cost of producing an additional unit of a good. As per the diagram, the slope of the line tangent to the TC (TC = AC x Q1) curve at Q1 is the firm's marginal cost at this output level.
Answer:
Investors use income statements to determine the profitability of a company over time. ... This is the amount that a company would pay shareholders, per share, if the company paid out all of its net income as dividends.
Explanation:
Answer and Explanation:
Given that Bond A pays $4,000 in 14 years and Bond B pays $4,000 in 28 years, and that the interest rate is 5 percent, we see that Using the rule of 70, the value of Bond A is 70/5 = doubled after 14 years. Now if its value is 4000 in 14 years, its current value must be halved. Hence the value is 2000.
Sinilarly the value of Bond B is approximately one fourth now because it pays 4000 in 28 years. Hence its value is 4000/4 = 1000.
Now suppose the interest rate increases to 10 percent. Hence the doubling time is 70/10 = 7 years
Using the rule of 70, the value of Bond A is now approximately 1,000 and the value of Bond B is 250
Comparing each bond’s value at 5 percent versus 10 percent, Bond A’s value decreases by a smaller percentage than Bond B’s value.
The value of a bond falls when the interest rate increases, and bonds with a longer time to maturity are more sensitive to changes in the interest rate.
