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sashaice [31]
3 years ago
5

A firm that shuts down temporarily has to pay a. its fixed costs but not its variable costs. b. its variable costs but not its f

ixed costs. c. both its variable costs and its fixed costs. d. neither its variable costs nor its fixed costs.
Business
1 answer:
Kamila [148]3 years ago
5 0

Answer:

its fixed costs but not its variable costs.

Explanation:

Fixed costs are costs that do not vary with output. e,g, rent, mortgage payments

If production is zero or if production is a million, Mortgage payments do not change - it remains the same no matter the level of output.

Hourly wage costs and payments for production inputs are variable costs

Variable costs are costs that vary with production

If a producer decides not to produce any output, there would be no need to hire labour and thus no need to pay hourly wages.

When a firm that shuts down temporarily, the firm would still  have to pay expenses such as rent and electricity bills. These constitute fixed cost. But the firm would not have to pay variable costs e.g. the cost of buying raw materials used in variation.

On the other hand, if the firm shuts down permanently, it would not pay both its variable costs and its fixed costs

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Donovan Company incurred the following costs while producing 500 units: Direct Materials, $10 per unit; Direct Labor, $25 per un
Natali5045456 [20]

Answer:

Net operating income= 15,000

Explanation:

The absorption costing method includes all costs related to production, both fixed and variable. The unit product cost is calculated using direct material, direct labor, and total unitary manufacturing overhead.

<u>In this case, there is no beginning nor ending inventory. Fixed overhead is incorporated into the cost of goods sold in full.</u>

Sales= 500*100= 50,000

COGS= (10 + 25 + 15)*500 + 10,000= (35,000)

Gross profit= 25,000

Total selling and administrative costs= (5*500) + 7,500= (10,000)

Net operating income= 15,000

8 0
3 years ago
Which of the following is mostly associated with the federal reserves role as the governments bank
Alecsey [184]
Indian currency value . and law and order RBI role
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slega [8]
I had to look for the options and here is my answer:
Based on the given description above, I can say that the Baumrind's parenting style that Matt and Tamela use is AUTHORITATIVE PARENTING. This is the type of parenting wherein parents impose limits on their children, but with a reason. Still, they respond to whatever their children needs.
5 0
3 years ago
Read 2 more answers
This is a growth strategy with a goal to take customers away from competitors.
vitfil [10]

Answer:

market penetration

Explanation:

As market is already created but the share of the company needs to be higher.

8 0
3 years ago
The following is cost information for the Creamy Crisp Donut Company.Entrepreneur's potential earnings as a salaried worker = $5
jarptica [38.1K]

Answer:

Creamy Crisp's total revenues exceed its total costs, including a normal profit, by $366,000

Explanation:

Creamy Crisp's total revenue exceeds its total cost, including a normal profit by =

When answering this we use all the actual costs and revenue and all the hypothetical figures, or the opportunity costs and revenue as we need to calculate total revenue exceeding costs and normal profits.

Total revenue actual + potential = Entrepreneur's potential earnings as a salaried worker $50,000 + Annual revenue from operations $380,000 + Value of entrepreneur's talent in the next best entrepreneurial activity $80,000 + Entrepreneur's forgone interest on personal funds used to finance the business $6,000

= $516,000

Total costs = Payments to workers $120,000 + Utilities (electricity, water, disposal) costs $8,000 + Annual lease on building = $22,000

= $150,000

Creamy Crisp's total revenues exceed its total costs including a normal profit by $516,000 - $150,000 = $366,000

Since normal profit is included and not excluded normal profit shall not be computed separately and the final answer is $366,000

4 0
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