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natta225 [31]
2 years ago
6

Bristo Corporation has sales of 1,000 units at $60 per unit. Variable expenses are 40% of the selling price. If total fixed expe

nses are $26,000, the degree of operating leverage is: Multiple Choice 2.40 6.00 2.57 3.60
Business
1 answer:
Misha Larkins [42]2 years ago
8 0

Answer:

3.60

Explanation:

Given that,

Sales units = 1,000

Sales price per unit = $60

Variable expenses = 40% of the selling price

Total Fixed cost = $26,000

Contribution margin per unit:

= Selling price - Variable cost

= $60 - ($60 × 40%)

= $60 - $24

= $36

Total contribution:

= Contribution margin per unit × Sales units

= $36 × 1,000

= $36,000

Profit = Total contribution - Fixed cost

         = $36,000 - $26,000

         = $10,000

Degree of operating leverage:

= (Sales - Variable costs) ÷ (Sales - Variable costs - Fixed Expenses)

= (60,000 - 24,000) ÷ (60,000 - 24,000 - 26,000)

= 36,000 ÷ 10,000

= 3.60  

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<span>b. debit interest receivable for​ $500 and credit interest revenue for​ $500
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7 0
3 years ago
Floyd Industries stock has a beta of 1.25. The company just paid a dividend of $.40, and the dividends are expected to grow at 5
stiks02 [169]

Answer:

5.62%

13.75%

Explanation:

According to the DDM method,

the value of a stock = [dividend x ( 1 + growth rate)] / [cost of equity - growth rate]

67 = 0.4(1.05) / r - 0.05

multiply both sides of the equation by r -0.05

67(r - 0.05) = 0.42

divide both sides of the equation by 67

r - 0.05 = 0.006269

r = 0.0563

= 5.63%

b. the cost of equity using the capm method =

risk free rate of return + beta x ( expected return - risk free return)

5% + 1.25 x (12 - 5) = 13.75%

3 0
2 years ago
What are the pros and con's for the arrive alive campaign?
Elena-2011 [213]
The Arrive Alive campaign was launched to prevent road accidents or at least lessen the instances of accidents due to drunk driving and reckless driving.

The advantages of this campaign are:

1. It promotes awareness among drivers to drive safely. 
2. It educates drivers on the rules and safe acts when on the road. 

The disadvantages of this campaign are:

1. It does not completely eliminate the risk of accidents due to drunk and reckless driving. It merely 'educates' the drivers about safe acts. 
2. It still allows the drivers to drink and drive but at 'allowable alcohol level' which does not help at all.

In the end, the Arrive Alive campaign failed. 
3 0
3 years ago
Read 2 more answers
Last year the company had net operating income of $450,000 on sales of $1,500,000. Lost Peak’s average operating assets for the
vesna_86 [32]

Answer:

$280,000

Explanation:

Computation for the company’s residual income for the year

Using this formula

Residual Income=Operating income- (Average operating assets×Rate of return)

Let plug in the formula

Residual Income = $450,000 – ($1,700,000 x 10%)

Residual Income=$450,000-$170,000

Residual income=$280,000

Therefore te company’s residual income for the year will be $280,000

5 0
3 years ago
A certain bookstore chain has two stores, one in San Francisco and one in Los Angeles. It stocks three kinds of books: hardcover
Hoochie [10]

Answer:

                           Hard       Soft        Plastic

San Francisco 3,600           7,800       12,000  

Los Angeles  2,400            1,800        3,000

Explanation:

The sales during January were as follows:

                          Hard      Soft          Plastic

San Francisco 600              1,300           2,000  

Los Angeles  400                300              500

If the sales during the next five months were actually the same, then to determine total sales all we have to do is multiply January's sales by 6.

600 x 6 = 3,600         1,300 x 6 = 7,800         2,000 x 6 = 12,000

400 x 6 = 2,400           300 x 6 = 1,800            500 x 6 = 3,000

7 0
3 years ago
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