Answer:
simple payback period = 1.9 years
discounted payback period = 2.08 years
Explanation:
the total cost of electricity per year = [(2 x 60 x 40 x 24 x 365) / 1,000] x $0.07 = $2,943.36
consumption for the actual time needed, assuming that the university is open all year long = [(2 x 60 x 40 x 12 x 5 x 52) / 1,000] x $0.07 = $1,048.32
savings resulting from installing motion sensors = $2,943.36 - $1,048.32 = $1,895.04
cost of installing the 40 sensors = ($50 + $40) x 40 sensors = $3,600
simple payback period = $3,600 / $1,895.04 = 1.9 years
discounted cash flows:
$1,895.04 / 1.06 = $1,787.77
$1,895.04 / 1.06² = $1,686.58
$1,895.04 / 1.06³ = $1,591.11
discounted payback period = 2 years + $125.65/$1,591.11 = 2.08 years
Morgan is 65 years old and single. He supports his father, who is 90 years old, blind, and has no income. What is Arthur's standard deduction
Answer:
The standard deduction for 2020 for a head of household is $18,650. But if the filer is 65 years old or older, then he/she receives an additional $1,650. Morgan's total standard deduction is $20,300.
Explanation:
Morgan can claim his father as a dependent, and therefore, qualify as head of household.
Arthur's standard deduction will be :
Additional sum of money will be added to Arthur's standard deduction.
Arthur's standard deduction will be the Additional sum of money will be added to Arthur's standard deduction.The taxable income of any taxpayer gets an additional amount added to the tax money that reduces the amount, this is called as the standard deduction. For any taxpayers whose age is 65 or even older can acquire the benefit of additional amount that gets added to their standard deduction.Learn more :
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An annuity is set up that will pay $1500 per year for ten years. What is the present value (PV) of this annuity given that the discount rate is 6%
Answer: The present value of the given annuity is $ 11040.13.
Explanation:
To calculate the present value for a given annuity, we use the equation:
[tex]PV=PMT\times \frac{(1-(\frac{1}{1+r^n}))}{r}[/tex]
where,
PV = present value
PMT = fixed annuity amount = $1500
r = rate of interest = 6 % = 0.06
n = time period = 10 years
Putting values in above equation, we get:
[tex]PV=\$ 1500\times \frac{(1-(\frac{1}{1+0.06^{10}}))}{0.06}\\\\PV=\$ 1500\times \frac{(1-(\frac{1}{1.06^{10}}))}{0.06}\\\\ PV=\$ 1500\times 7.36\\\\ PV=\$ 11040.13[/tex]
Hence, the present value of the given annuity is $ 11040.13.
19. An investor has purchased a property that is giving him a 10% rate of return. Potential gross rents total $10,000.00 a month. Expenses for the property total $47,570.00 per year. The property has a vacancy rate of 8%. What is the market value of the property
Answer:
the market value of the property is $628,300
Explanation:
The computation of the market value of the property is shown below;
Gross rent $10,000 × 12= $120,000
Now
= $120,000 × .92 (occupancy rate)
= $110,400
After that
= $110,400 - $47,570
= $62,830
And ,finally the market value of the property is
= $62,830 ÷ 0.10
= $628,300
hence, the market value of the property is $628,300
The market value of the products or the goods and services is termed as the value of the company that is established as per the stock market. The current price of the company's share is totally based on the value and the goodwill of the company in the market.
The market value of the property is $628,300
The computation of the market value of the property is shown below;
Gross rent [tex]\$10,000 \times 12[/tex]= $120,000
Now,
= [tex]\$120,000\times .92[/tex] (occupancy rate)
= $110,400
After that
= $110,400 - $47,570
= $62,830
And ,finally the market value of the property is
= [tex]\frac{ \$62,830}{ 0.10 }[/tex]
= $628,300
Therefore, the market value of the property is $628,300
To know more about the market value, refer to the link below:
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The ability to use the available limited resources in the most effective, streamlined way is known as __________.
Answer:
Efficiency
Explanation:
In economics, it is commonly known that human wants are unlimited but the resources to satisfy these wants are limited.
The term efficiency is used to allocate available limited resources in the most effective streamlined ways by cutting unnecessary waste. Efficiency creates least production cost, maximum production output and surplus from the market.
Efficiency reduces or cut waste of resources like energy , physical materials, time etc whereas the desired production output is met.
Assign each of the following to a category of GDP. Assume products are made domestically unless indicated otherwise: You buy a car multiple choice 1 Consumption Investment Govt. Purchases Imports or Exports A bakery buys a new oven multiple choice 2 Consumption Investment Govt. Purchases Imports or Exports You get a haircut multiple choice 3 Consumption Investment Govt. Purchases Imports or Exports Your town buys a fire truck multiple choice 4 Consumption Investment Govt. Purchases Imports or Exports You buy shoes made in Thailand multiple choice 5 Consumption Investment Govt. Purchases Imports or Exports The Federal Government builds a bridge multiple choice 6 Consumption Investment Govt. Purchases Imports or Exports A private hospital buys a new MRI machine multiple choice 7 Consumption Investment Govt. Purchases Imports or Exports You stay in a hotel in Italy multiple choice 8 Consumption Investment Govt. Purchases Imports or Exports
Solution :
GDP stand for Gross Domestic Product. It is the measure of a national production and income of a country. It is the total produce of any country's products and services in a financial year that will boast its economy.
According to the question, assigning to the category of GDP are :
1. When we buy a car : --- Consumption
2. When a new oven is bought by a bakery : --- investment
3. When we get a haircut done : -- Consumption
4. Town buys a new fire truck : --- Government purchase
5. When we buy a new pair shoe that is made in Thailand : --- Exports or Imports
6. A bridge build by the Federal Government : --- Government purchase
7. A MRI machine bought by a private hospital : --- Investment
8. When we stay in hotel that is in Italy : --- Imports or Exports
The Walden Manufacturing Corp. has interest expense of $4,000, factory supplies of $1,000, indirect labor of $6,000, direct materials of $16,000, advertising expense of $2,500, office expense of $14,000, and direct labor of $20,000. What is the total period cost
Answer:
$20,500
Explanation:
A cost that does not form a section or part of the manufacturing process is called period cost.
Period cost is therefore;
= Interest expense + Advertising expense + Office expense.
Given the above information,
Total period cost = $4,000 + $2,500 + $14,000
Total period cost = $20,500
You are the assistant to the CEO of a small textile firm that manufactures high-quality premium priced, stylish clothing. The CEO has decided to see what the opportunities are for exporting to France and has asked you for advice as to the steps the company should take. What advice would you give to the CEO
Answer:
My advice to the CEO would be:
First, make a general assessment of the social, economic, and political climate of France. France is a developed country, so this should not impede entering in the French market, but this kind of analysis should anyway be made.
Second, make an assessment of the business climate in France, taking into account factors like tax policy, economic policy and more improtantly, trade policy.
Third, make a market study of the high-end clothing sector in France. France is a country that has many renowned luxury brands, so competition is going to be stiff no matter what, but the market study could highlight some areas where a different kind of impact could be made.
Finally, develop a strategic plan before entering the French market. This plan can be made taking into account all the information from he previous analysis.
g Operating activities: Multiple Choice Are the means organizations use to pay for resources like land, buildings and equipment. Involve using resources to research, develop, purchase, produce, distribute and market products and services. Involve acquiring and disposing of resources that a business uses to acquire and sell its products or services. Are also called asset management. Are also called strategic management.
Answer:
Involve using resources to research, develop, purchase, produce, distribute and market products and services
Explanation:
Operating activities are a business's main activities. These activities ranges from manufacturing, marketing and then the selling of product/service.
They are the daily activities of a company that is engaged in production and sales of its product, revenue generation.
It is very important because it gives cash flow information as it relates to the every day operation of the business and from this the viability of the business can be seen.
Re-engineering a software system has two key advantages over more radical approaches to system evolution: Select one: a. Reduced Risk and Reduced Cost b. No Risk and Low cost c. Risk Free and Cost effective d. None of the above
Answer:
a. Reduced Risk and Reduced Cost.
Explanation:
A software such as an operating system is a system software pre-installed on a computing device to manage or control software application, computer hardware and user processes.
This ultimately implies that, an operating system acts as an interface or intermediary between the computer end user and the hardware portion of the computer system (computer hardware) in the processing and execution of instructions.
Some examples of an operating system on computers are QNX, Linux, OpenVMS, MacOS, Microsoft windows, IBM, Solaris, VM etc.
Re-engineering a software system has two key advantages over more radical approaches to system evolution:
a. Reduced Risk: this is simply because redeveloping a software poses a high risk to the business organization or individual due to developmental issues or errors.
b. Reduced Cost: the process of re-engineering is usually cheaper for businesses.
how do you decide whether the company should employ aggressive capital investments in global business areas
Answer:
One key managerial tool that can help decide whether or not a company should employ aggressive capital investments in global business areas is capital budgeting.
Capital budgeting is a quantitative evaluation of the opportunities within a business space and helps management to decide based on the most acceptable trade-off between returns on investment and risk, which opportunity is worth taking a shot at.
Explanation:
Availability of Capital: Capital budgeting assumes that there is enough capital in the first place.
Payback Period: This is a budgeting technique that measures the time taken to recover the initial capital outlay into a business. Some investment have long payback periods other short payback time frame. A short payback period is generally more acceptable than a medium-term or longer-term payback. However, none of the payback period frames are in themselves good or bad. They become acceptable or not when compared to other factors. For example, in a business space or industry where there is a very high barrier to entry such as a patent protecting competition from replicating a similar product, a long-term payback becomes acceptable as long as it fall within the patent period.
There are so many other capital budgeting related factors that help the investor company decide how aggressive it should go. They are:
Internal Rate of ReturnProfitability IndexNet Present Value etcRisks: Given that the company is playing in the global business arena, knowledge about global risks and in-country specific risks are very strong determinants about whether or not the company can go aggressive.
If the financial feasibility is high and the risk is very high, the company may excercise restraint.
If the risks are very low, the company may go aggressive.
Detailed Business Plan: It is a very good practice to have a detailed business plan for investing in certain areas.
One key component of the business plan other than those already discussed is the Human Capital component.
If the risk of the investment if admissible and the financial feasibility checks out, there has to be adequate availability of human capital to manage the investments.
Regardless of how big the company is, I would thread carefully if we don't have tested and trusted hands at the executive level to oversee capital investments.
Cheers
At December 31, 2011 the accounting records of Gordon, Inc. contain the following items: If the Notes Payable is $10,000, the December 31, 2011 cash balance is:
The question is incomplete. The complete question is as follows,
At December 31, 2011 the accounting records of Gordon, Inc. contain the following items:
Accounts Payable 2500
Land 30000
Building 31250
Notes Payable ?
Retained earnings 125000
Accounts Receivable 18750
Cash ?
Equipment 40000
Capital Stock 12500
If the Notes Payable is $10,000, the December 31, 2011 cash balance is:
Answer:
Cash = $30000
Explanation:
The accounting equation states that the sum of total assets is always equal to the sum of total liabilities plus total equity. We can state the equation as follows,
Total Assets = Total Liabilities + Total Equity
So,
(30000 + 31250 + 18750 + 40000 + Cash) = (2500 + 10000) + (125000 + 12500)
120000 + Cash = 12500 + 137500
Cash = 150000 - 120000
Cash = $30000
The Affordable Care Act authorizes a number of payment reform demonstrations. Group of answer choices True False
Answer: True
Explanation:
The Affordable Care Act was signed into law in 2010 and it is simply a reform in the healthcare sector and it had to do with the policies that will enable Americans without insurance to enjoy insurance coverage.
The statement that The Affordable Care Act authorizes a number of payment reform demonstrations is true.
, Inc., purchased inventory costing and sold % of the goods for . All purchases and sales were on account. later collected % of the accounts receivable. 1. Journalize these transactions for , which uses the perpetual inventory system. 2. For these transactions, show what will report for inventory, revenues, and expenses on its financial statements at the end of the month. Report gross profit on the appropriate statement. 1. Journalize these transactions for , which uses the perpetual inventory system.
Answer:
1a. Dr Inventory 160,000
Cr Accounts Payable 160,000
1b. Dr Accounts Receivable 188,000
Cr Sales Revenue 188,000
1c. Dr Cost of Goods Sold 128,000
Cr Inventory 128,000
1d. Dr Cash 56,400
Cr Accounts Receivable 56,400
2a. $32,000
2b. $60,000
Explanation:
1. Preparation of Journal entry using the perpetual inventory system
a. Preparation of the journal entry to record the purchase of inventory.
Dr Inventory 160,000
Cr Accounts Payable 160,000
b. Preparation of the journal entry to the sale
Dr Accounts Receivable 188,000
Cr Sales Revenue 188,000
c. Preparation of the journal entry to Record the cost of goods sold portion of the sale.
Dr Cost of Goods Sold 128,000
Cr Inventory 128,000
(80%*160,000)
d. Preparation of the journal entry to Record the collection of 30% of the accounts receivable.
Dr Cash 56,400
Cr Accounts Receivable 56,400
(30%*188,000)
2. Calculation for what Marcy will report for inventory, revenues, and expenses on its financial statements at the end of the month and to Report gross profit on the appropriate statement
2a. Calculation to Determine what the company will report on the balance sheet:
BALANCE SHEET
Current assets:
Inventory $32,000
[160,000-(80%*160,000)]
2b.Calculation to Determine what the company will report on the income statement:
INCOME STATEMENT
Sales revenue 188,000
Cost of goods sold (128,000)
(80%*160,000)
Gross profit $60,000
(188,000-128,000)
Brothern Corporation bases its predetermined overhead rate on the estimated machine-hours for the upcoming year. Data for the most recently completed year appear below: Estimates made at the beginning of the year: Estimated machine-hours 34,200 Estimated variable manufacturing overhead $ 6.21 per machine-hour Estimated total fixed manufacturing overhead $ 1,006,164 Actual machine-hours for the year 32,000 The predetermined overhead rate for the recently completed year was closest to:
Answer:
$35.63
Explanation:
The formula for predetermined overhead ate is
= Predetermined fixed overhead rate ÷ Predetermined variable overhead rate
Where;
Predetermined fixed overhead rate = (Fixed overhead cost ÷ Estimated direct labor)
= $1,006,164 ÷ 34,200
= $29.42
But the predetermined variable overhead is $6.21 per machine hour
Therefore, the predetermined overhead rate is
= $29.42 + $6.21
= $35.63
If the firm sells its product at the market price of $10 per unit, how many workers should the firm employ to maximize profit if the wage rate is $55
Answer:
the data regarding output and the quantity of labor is missing, so I looked for a similar question and found the attached image.
if one employee is hired, total production = $80, and total cost = $55
if two employees are hired, total production = $150, and total cost = $110
if three employees are hired, total production = $210, and total cost = $165
if four employees are hired, total production = $260, and total cost = $260
hiring four employees should maximize profits since MC = MR
Donata Company purchased equipment for $30,000 in December 20x1. The equipment is expected to generate $10,000 per year of additional revenue and incur $2,000 per year of additional cash expenses, beginning in 20x2. Under MACRS, depreciation in 20x2 will be $3,000. If the firm's income tax rate is 40%, the after-tax cash flow in 20x2 would be: $6,000. $3,600. $3,200. $4,800. None of the answers is correct.
Answer:
$6,000
Explanation:
The cash flow of a company is different from the net income of the company because net income includes some non-cash items like depreciation etc., which should be adjusted to calculate the cash flow of the company. The depreciation is added back to the net income in order to adjust this non-cash expense in the net income to arrive at cash flow for the period.
First, we need to calculate the net income as follow
Additional Revenue _________ $10,000
Less: Additional Cash expenses $2,000
Less: Depreciation ___________$3,000
Income Before tax ___________ $5,000
Less: Tax 40% ( $5,000 x 40% ) _ $2,000
Net Income _________________$3,000
Now We need to calculate the cash fow as follow
Cash Flow in 20x2 = Net income of 20x2 + Depreciation
Cash Flow in 20x2 = $3,000 + $3,000
Cash Flow in 20x2 = $6,000
Sheridan Company owns equipment that cost $963,000 and has accumulated depreciation of $406,600. The expected future net cash flows from the use of the asset are expected to be $535,000. The fair value of the equipment is $428,000.
Required:
Prepare the journal entry, if any, to record the impairment loss.
Answer:
Debit : Impairment loss $21,400
Credit : Accumulated impairment loss $21,400
Explanation:
An Asset is impaired when its Carrying Amount > Recoverable Amount
where,
Carrying Amount = Cost - Accumulated depreciation
therefore,
Carrying Amount = $963,000 - $406,600 = $556,400
and
Recoverable Amount is the higher of
1. Value in use = $535,000
2. Fair Value less cost to sell $428,000
therefore,
Recoverable Amount is $535,000
Conclusion :
Since, Carrying Amount ($556,400) > Recoverable Amount ($535,000), the asset is impaired.
Impairment loss = $21,400 ($556,400 - $535,000).
While consumers can use ________ to assist them with shopping, retail clerks, salespeople, and technicians can also use them to check manuals for technical information, verify stock inventories, place orders, or even check out customers from anywhere in the store.
Answer:
While consumers can use __shopping list__ to assist them with shopping, retail clerks, salespeople, and technicians can also use them to check manuals for technical information, verify stock inventories, place orders, or even check out customers from anywhere in the store.
Explanation:
Customers usually prepare shopping lists to help them with their shopping activities. A shopping list is a prepared list of items that a consumer uses to purchase goods and services. The list improves the quality of the shopper's experience by making it easier, faster, and most importantly, smarter for the customer to pick out the required items or services. It is also a means of controlling one's expenses.
True) or (False)? The monetary unit principle is the broad principle that requires identifying the activities of a business with specific time periods such as months, quarters, or years.
Answer:
The monetary unit principle is the broad principle that requires identifying the activities of a business with specific time periods such as months, quarters, or years.
False.
Explanation:
This accounting assumption is based on the use of money as a unit of measurement. The monetary unit principle assumes that all transactions or economic events recorded in the accounts of an entity can be expressed and measured in monetary terms or currency, like the dollar. The principle ascribes some stability and trust in the monetary units. What is actually described above is the periodicity concept.
Some argue that Sweden's generous welfare benefits, which pay people who lose their jobs as much as 80 percent of previous incomes for three years, has resulted in too-high unemployment. This can be seen as an example of:
Answer:
Government failure in fostering a competitive market environment.
Explanation:
Unemployment rate refers to the percentage of the total labor force in an economy, who are unemployed but seeking to be gainfully employed. The unemployment rate is divided into various types, these include;
I. Cyclical unemployment rate (CU).
II. Frictional unemployment rate (FU).
III. Structural unemployment rate (SU).
IV. Actual unemployment rate (AU).
V. Natural Rate of Unemployment (NU).
Some argue that Sweden's generous welfare benefits, which pay people who lose their jobs as much as 80 percent of previous incomes for three years, has resulted in too-high unemployment. This can be seen as an example of government failure in fostering a competitive market environment.
This simply means that, in a perfectly competitive market, there are many buyers and sellers (price takers) of homogeneous products (standardized products with substitute) and the market is free (practically open) to all individuals or business entities that are willing to trade all their goods and services.
Hence, a perfectly competitive market is characterized by the following features;
1. Perfect information.
2. No barriers, it is typically free.
3. Equilibrium price and quantity.
4. Many buyers and sellers.
5. Homogeneous products.
Examples of a perfectly competitive market are the Agricultural sector, e-commerce and the foreign exchange market.
Rich, Inc. acquired 30% of Doane Corporation's voting stock on January 1, 2021 for $1,000,000. During 2021, Doane earned $400,000 and paid dividends of $250,000. Rich's 30% interest in Doane gives Rich the ability to exercise significant influence over Doane's operating and financial policies. During 2022, Doane earned $500,000 and paid cash dividends of $150,000 on April 1 and $150,000 on October 1. On July 1, 2022, Rich sold half of its stock in Doane for $660,000 cash. What should the gain be on sale of this investment in Rich's 2022 income statement
Answer:
$122,500
Explanation:
Calculation for What should the gain be on sale of this investment in Rich's 2022 income statement
Gain on sales of investement=$660,000-[$1,045,000 – ($150,000 × 30%) + ($500,000 × 50% × 30%)/2]
Gain on sales of investement=$660,000-[($1,045,000 – $45,000 + $75,000)/2]
Gain on sales of investement=$660,000 – ($1,075,000 ÷ 2)
Gain on sales of investement=$660,000 – $537,500
Gain on sales of investement= $122,500
Therefore what should the gain be on sale of this investment in Rich's 2022 income statement is $122,500
Which of the following would NOT be classified as a current asset on a classified balance sheet? 答案选项组 Intangible assets Short-term investments Investment securities (trading) Prepaid expenses
Answer:
Intangible assets
Explanation:
A classified balance sheet is a financial statement that classifies the components in the balance sheet into different groups. For example, assets are classified into current or non current asset
Current assets are all the assets that are either used by a company or sold in the course of the year of the company.
Current assets include
cash, cash equivalentsaccounts receivablestock inventorymarketable securitiespre-paid liabilitiesIntangible assets are classified as noncurrent (long-term) assets
This activity is important because marketing managers must discover what prospective customers need and want. Marketing managersuse this knowledge to create products and services for their various target markets. Different marketing mixes are then developed toserve the unique needs or the firm’s target markets.
The goal of this exercise is to demonstrate your understanding of how a marketing manager might use the marketing mix to create valuefor two distinct car rental service segments. The first is the business traveler segment (customers traveling primarily for business), andthe second is the leisure traveler segment (customers traveling primarily for leisure or relaxation)
a. Luxury Cars
b. SUV/Minivan
c. Free Car seat
d. Gold Club
e. Airport Hubs
f. Premium
g. Park Access
h. Saver
Decide which marketing mix element it represents and which segment it reaches.
Marketing Mix Element: Business traveler segment Leisure traveler segment
Product Strategy
Price Strategy
Promotion Strategy
Place Strategy
Answer:
Note: See table attached to question below to fully understand
Marketing mix Business traveller Luxury traveller
element segment segment
Product strategy Luxury car SUV or Minivan
Price strategy Premium Saver
Promotion strategy Gold club Free car seat
Place strategy Airport hubs Park access
Nebraska Inc. issues 4,100 shares of common stock for $131,200. The stock has a stated value of $15 per share. The journal entry to record the stock issuance would include a credit to Common Stock for
Answer:
$61,500
Explanation:
Based on the information given if the company
issues 4,100 shares of common stock for the amount of $131,200 in which the stock has a stated value of $15 per share which means that The journal entry to record the stock issuance would include a credit to Common Stock for $61,500 Calculated as:
Credit to Common Stock=4,100 shares*$15 per share
Credit to Common Stock=$61,500
What is the beta of a 3-stock portfolio including 25% of stock A with a beta of 0.90, 40% of stock B with a beta of 1.05, and 35% of stock C with a beta of 1.73
Answer:
1.25
Explanation:
Calculation for What is the beta of a 3-stock portfolio
Portfolio beta = (.25 *0.9) + (.4 *1.05) + (.35 *1.73)
Portfolio beta = .225 + .42 + .606
Portfolio beta = 1.25
Therefore the beta of a 3-stock portfolio will be 1.25
By Nike changing the technology in their shoe, they are taking on a role of being more socially responsible. What type of business practice is Nike partaking in as they incorporate doing well by doing good into their business model
Explanation:
In this case, Nike is incorporating corporate governance into its business model, which is defined as a model for managing companies using the best market practices, using transparency, equity and social and environmental responsibility as essential parameters.
Companies today are no longer perceived by society as merely profitable entities, it is a social demand that companies assist in the development of society and minimize their impacts on the environment.
When companies develop programs to support society and sustainability, it guarantees the advantages of being better positioned in the market, attracting more investors, adding more value to its products and services and gaining a strategic and competitive advantage in the market.
Because supply curves slope upward, this supports the law of supply that as prices __________, more goods will be supplied.
Answer: increase
Explanation:
The supply curves slope upward due to the fact that there's a direct relationship between the price of the good and the quantity that's supplied.
This means that when price increase let's say the price of a good moves from $5 to $7, the suppliers will supply more due to the price increase.
Since 2009, with the release of IFRS 9, which covers the classification/ measurement of financial assets, which is also known as phase I of the replacement of IAS, the IASB is seeking to move the valuation of financial instruments closer to:
Answer:
Amortized Value
Explanation:
On 12 November 2009, IFRS 9 which deals with Financial Instruments was issued, covering Classification and Measurement of financial assets. This replaced IAS 39 : Financial Instrument Recognition and Measurement.
The new standard, IFRS 9 divides all financial instruments that are currently within the scope of IAS 39 into two classifications which are (1) those measured at amortized cost and (2) those measured at fair value.
Therefore, the IASB is seeking to move the valuation of financial instruments closer to Amortized Value.
Do you think GDP is the best indicator to measure the living standard of a country? Justify your answer (4 marks)
Explanation:
GDP is an indicator of a society's standard of living, but it is only a rough indicator because it does not directly account for leisure, environmental quality, levels of health and education, activities conducted outside the market, changes in inequality of income, increases in variety, increases in technology,
GDP is an accurate indicator of the size of an economy and the GDP growth rate is probably the single best indicator of economic growth, while GDP per capita has a close correlation with the trend in living standards over time.
At Bargain Electronics, it costs $29 per unit ($17 variable and $12 fixed) to make an MP3 player that normally sells for $53. A foreign wholesaler offers to buy 4,510 units at $28 each. Bargain Electronics will incur special shipping costs of $4 per unit. Assuming that Bargain Electronics has excess operating capacity, indicate the net income (loss) Bargain Electronics would realize by accepting the special order. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)
Answer and Explanation:
The computation is shown below;
Particulars Reject Order Accept Order Net Income
Revenues $0 $126,280 $126,280
(4,510 units × $28)
Variable manufacturing $0 $76,670 -$76,670
(4,510 units × $17)
Shipping $0 $18,040 -$18,040
(4,510 units × $4)
Net Income $0 $31,570 $31,570
Hence, the net income is in positive value so the special order would be accepted