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nata0808 [166]
3 years ago
5

C93, Inc. sells three products. Income statement information for the three products for the most recent year is given below: Pro

duct A Product B Product C Selling price per unit ..... $25 $20 $18 Costs: Variable costs ............ $140,000 $156,000 $ 72,000 Advertising ............... $ 23,800 $ 26,800 $ 20,500 Rent ...................... $ 12,400 $ 12,400 $ 12,400 Supervisor's salary ....... $ 31,700 $ 32,800 $ 34,300 Property taxes ............ $ 7,000 $ 3,000 $ 4,000 Units sold ................. 7,000 13,000 10,000 The rent is allocated to the three products equally and the property taxes are allocated based on the square footage each product uses in the factory. C93, Inc. is considering eliminating Product A. If Product A is eliminated, the space currently being used to produce Product A can be rented out for $17,300 per year. Calculate the number of units of Product A that would need to be sold next year in order for C93, Inc. to be economically indifferent between dropping and keeping Product A.
Business
1 answer:
aleksandrvk [35]3 years ago
5 0

Answer:

14,560 units.

Explanation:

Variable costs for Product A = $140,000 / 7,000 units

Variable costs for Product A = $20

<u>Avoidable costs for Product A:</u>

Advertising                                   $23,800

Rent                                              $17,300

Supervisor's salary                       <u>$31,700</u>

Avoidable costs for Product A    <u>$72,800</u>

<u />

Contribution margin per unit = $25 - $20 = $5

Economically indifferent units = Avoidable costs for Product A/Contribution margin per unit

Economically indifferent units = $72,800 / $5

Economically indifferent units = 14,560 units

So therefore, the number of units of Product A that would need to be sold next year is 14,560 units.

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Answer:

Stakeholder

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Suppose the economy is producing at the natural rate of output. An increase in consumer and business confidence will cause _____
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Answer:

d) no change; a decrease

Explanation:

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Inflation is one of the most important macroeconomic indicator that intends the rate how the purchase power of the money is falling  by the rising on the price levels of goods and services. In long run, the most influencing element for inflation is the rate of money supply but if we consider business and consumer confidence are the positive things for the developing of GDP, then they will have a little bit decrease effect on inflation.

8 0
3 years ago
Fragment Company is a wholesaler that sells merchandise in large quantities. Its catalog indicates a list price of $300 per unit
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Answer:

Recognized Sales Value = $18,000

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Fragment company selling Price is $300/Unit

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Cost of Haulage (Carriage outwards) is $7 x 100 units = $700

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