Each unit sells: $80
Each unit costs to make: $32
Fixed costs: 72,000
Goal: 2,000 units sold
If they meet their goal, let's see how that would go:
(2,000 * 80) - (2,000 * 32) - 72,000 = ?
160,000 - 64,000 - 72,000 = 24,000
24,000 is the profit they would make for hitting their goal.
Question 1:
What is the break-even point? The break-even means they make no money, but they also lose no money. So that final number (24,000) would be 0 instead. How many units would they have to make to hit zero?
(x * 80) - (x * 32) - 72,000 = 0.
80x - 32x = 72,000
48x = 72,000
x = 1500 units
We can verify by using our first formula we've already determined, using this new value for units.
(1,500* 80) - (1,500 * 32) - 72,000 = ?
120,000 - 48,000 - 72,000 = 0? True!
Question 2: If they increase their expenses by 16,000, what is their new break even point?
(x * 80) - (x * 32) - 72,000 - 16000 = 0.
80x - 32x - 88000 = 0
48x = 88000
x = 1833
Question 3: 10% reduction in selling price and 10% increase in sales. (Assuming based off the original formula the problem provided.)
Original: (2,000 * 80) - (2,000 * 32) - 72,000 = ?
10% Reduction in price: 8
80-8 = 72
10% increase in sales: 200
2000 + 200 = 2200
Plugin to our formula:
(2200 * 72) - (2200 * 32) - 72,000 = ?
158400 - 70400 - 72,000 = 16,000
Since this number is positive, this is income. (D)
Answer:
Annual Yield = 34.08%
Explanation:
A treasury is a short-term financial instrument issued by a government with a maturity date of 365 days or less. It is issued for a value less than the its face value., therefore it is a discounted instrument.The face value is the amount that the investor will receive at the maturity of the bill.
To calculate the the effective annual yield of a bond; follow the steps below:
Step 1: Calculate the return earned for the investment period. This called the yield for the investment period. Note that the investment may be for less than 365 days depending on the number of days left to maturity when it was purchased.
(Face Value - Price)/Price × 100
= ((100-90)/90)× 100= 11.%
This helps to ascertained the return earned as a percentage of the amount invested.
Step 2: Calculate the annual effective rate. This is required to determine the equivalent return (yield) per annum should the investment be made for one year.
Annualized Yield= (Yield/Time period to maturity) × 365
= (11.11%/119) × 365
= 34.08%
Answer:
Alternative A : 7,800 units
Alternative B: 5,250 units
Explanation:
Were:
for A:
15 - 10 = 5 contrbution margin
each unit contributes 5 dollars
then: $39,000 fixed cost / $5 per unit = 7,800 units
It need to sale 7,800 untis to pay the fixed cost generated for alternative A
for B:
15 - 11 = 4 contribution margin
each unit contributes 4 dollars
then: $21,000 fixed cost / $4 per unit = 5,250
It need to sale 5,250 units to pay the fixed cost for this alternative
Answer:
The correct answer is $6934.48.
Explanation:
According to the scenario, the given data are as follows:
Time period ( 41 - 64 years) (n)= 24 years
Rate of interest (r) = 8%
Future value (FV) = $500,000
Annual deposit amount = P
So, we can calculate the annual deposit amount by using following formula:
FV = P × (1+r) × [{ (1+r)^n - 1} ÷ r]
By putting the value, we get
$500,000 = P × ( 1 + 0.08) [{ (1+0.08)^24 - 1} ÷ 0.08]
$500,000 = P × ( 1.08) [{ (1.08)^24 - 1} ÷ 0.08]
$500,000 = P × ( 1.08) [{ 6.34118073724 - 1} ÷ 0.08]
$500,000 = P (72.1035)
P = $500,000 ÷ 72.1035
P = 6934.48
