Cost of merchandise sold = Beginning inventory + purchases - [purchase discount +ending inventory].
Cost of merchandise sold = 5000 + 21,800 - [790 + 5,100]
26, 800 - 5,890 = 20,910
Therefore, the amount of money that is used to produce the merchandise sold is $20, 910.
Answer:
Explanation:
Last year Current year
Selling Price 10 10
Varaible Price 5 6
Contribution Margin 5 4
Break even is the point where total cost is equal to total revenue mean no profit and loss.
company earns the contribution margin after covering the variable cost, now only fix cost remains for break even.
Break Even using FIFO method : first In first out system
Fix Cost = 86000
contribution from opening units(6000*5) = 30000
Remaining Fix cost that should be Covered from
current year products = 56000
Units to be sold for break-even ( 56000/4) = 14000
so we have break even units 6000+14000 = 20000
Fix cost = -86000
Opening 6000*5 = 30000
Current 14000*4 = 56000
Profit = 0
Break Even using LIFO method : Last in first out
Fix Cost = 86000
Break even = Fix Cost / Contribution margin
Break even = 86000/4 =21500
current production is 24000 which is higher than break even units so we can cover the fix cost from current year production because company is using lifo method. we do not need opening units for the break even.
Answer:
Explanation:
Match the following terms with their definitions.
A. Confusion and Inconvenience :inflation decreases the reliability of the unit of account making it more complicated to differentiate successful and unsuccessful firms thereby impeding the efficient allocation of funds to alternative investments.
B. Shoeleather costs : the resources wasted when inflation induces people to reduce their money holdings.
C. Relative Price Variability : because prices change infrequently, higher inflation causes relative prices to vary more. Decisions based on relative prices are then distorted so that resources may not be allocated efficiently.
D. Unexpected Inflation :inflation decreases the real value of debt thereby transferring wealth from creditors to debtors.
E. Menu costs the cost of more frequent price changes at higher inflation rates.
F. Inflation Induced Tax Distortions
:the income tax is not completely indexed for inflation; an increase in nominal income created by inflation results in higher real tax rates that discourage savings.
Consistent / standardized.
Laptops are an example of standardized good, whose quality ought to be consistent as their quality determines the trustworthiness of a firm. If a good is bad, then consumers may start having a negative perception of the firm.
Answer:
<u>Base the bid on the incremental costs incurred because the job will contribute toward the company's profit.</u>
Explanation:
Note that <em>the term having 'excess capacity' means the company has more than enough resources to bid for contacts.</em>
Since the company's overall goal is to make more profit it bidding strategy over its competitors should highlight that it has lower incremental (marginal) cost because of having full capacity in place. This fact would give the company an edge in the bid.
