BUSINESS COLLEGE

At a sales level of $270,000, the magnitude of operating leverage for Donuts Unlimited is 2.8. If sales increase by 15%, profits will increase by:a.
15%

b.
18.67%

c.
2.8%

d.
42%

Answers

Answer 1
Answer:

Answer:

Option D is correct (42%)

Explanation:

Option D is correct (42%)

In order to find the  profit we will proceed as follow:

Given data:

Operating leverage for Donuts Unlimited=2.8

Increase in sale=15%

sales level= $270,000

Required:

Increase in Profit=?

Solution:

% Increase In profit/net income=% Increase in Sales*Operating leverage

% Increase In profit=15%*2.8

% Increase In profit=42%

Related Questions

Edward Lewis just received a cash gift from his grandfather. He plans to invest in a five-year bond issued by Sunland Corp. that pays an annual coupon rate of 4.5 percent. If the current market rate is 10.00 percent, what is the maximum amount Edward should be willing to pay for this bond
A. Explain the role labor’s productivity plays in wage determination in the competitive labor market. If productivity increases, what happens to wages and why? b. What is meant by the term "compensating wage differentials?" c. Why is the demand for labor called a "derived demand."
On July 1, Shady Creek Resort borrowed $330,000 cash by signing a 10-year, 12% installment note requiring equal payments each June 30 of $58,405. What amount of interest expense will be included in the first annual payment
For a business to be successful and to fulfill itsmission and vision, it will need a strategy forbeating the competition called a competitiveadvantage. Competitive advantage comes from one(or a combination) of all of the following factorsEXCEPTaqualitybquantityCpricedserviceelocation
Alyeska Services Company, a division of a major oil company, provides various services to the operators of the North Slope oil field in Alaska. Data concerning the most recent year appear below: Sales $17,600,000 Net operating income $6,200,000 Average operating assets $36,000,000Required:a. Compute the margin for Alyeska Services Company.b. Compute the turnover for Alyeska Services Company.c. Compute the return on investment (ROI) for Alyeska Services Company.

By the end of December, Jackson Company has completed work of $2,000. Jackson company has neither billed the clients nor recorded any of the revenue. If the appropriate adjusting entry is not made at the end of the year, what will be the effect on: (a) Income statement accounts (overstated, understated, or no effect)? (b) Net income (overstated, understated, or no effect)? (c) Balance sheet accounts (overstated, understated, or no effect)?

Answers

Answer:

(A) sales revenue: understated

    gross profit: understated

(B) net income: understated

(C) Retained Earnings : understated

    Unearned Services: overstated

Explanation:

(A) sales revenue will not represent the real sales attributable for the period. It will be 2,000 lower than it should be.

Ths will make gross profit be understated as well as is the difference between the sales and the COGS

(B) net income is understated as it do not include a revenue for 2,000 thus, is lower.

(C) unearned services is overstated has it should decrease by 2,000

RE is understate as will increase by the 2,00 additional net income.

More needs to be done to capitalise on the power of the peer-to-peer networks that many music downloaders still use. A recent study found that regular downloaders of unlicensed music spent an average of £5.52 a month on legal digital music. This compares to just £1.27 spent by other music fans. The research clearly shows that music fans who breakpiracy laws are highly valuable customers. It also suggests that they are eager to adopt legitimate music services in the future. One researcher pointed out that "There's a myth that all illegal downloaders are mercenaries hell-bent on breaking
the law in pursuit of free music. In reality hardcore fans "are extremely enthusiastic about paid-for services, as long as they are suitably compelling, he said.
People who download unlicensed music tend not buy legal digital music.

A True
B False
C Cannot Say

Answers

The answer to the prompt that "People who download unlicensed music tend not buy legal digital music" is False.

Judging from the passage above, the answer to this prompt is false.

The passage makes it clear that those who regularly downloaded unlicensed music also "spent an average of £5.52 a month on legal digital music."

This shows that this crop of individuals are willing to purchase legal digital music.

Learn more about unlicensed music here:

brainly.com/question/7668788
Im pretty sure it’s true

The composition of the Fingroup Fund portfolio is as follows: Stock Shares Price A 320,000 $ 40 B 420,000 45 C 520,000 10 D 720,000 15 The fund has not borrowed any funds, but its accrued management fee with the portfolio manager currently totals $40,000. There are 6 million shares outstanding. What is the net asset value of the fund

Answers

Answer:

The correct answer is $7.94.

Explanation:

According to the scenario, the computation of the given data are as follows:

Total value of shares = ( 320,000 × $40 ) + ( 420,000 × $45) + (520,000 × $10) + 720,000 × $15)

= $12,800,000 + $18,900,000 + $5,200,000 + $10,800,000

= $47,700,000

So we can calculate the net asset value by using following method:

Net asset value = (Total value - Expenses ) ÷ Shares Outstanding

By putting the value, we get

= ( $ 47,700,000 - $ 40,000) ÷ $6,000,000

= $7.94

In need of extra​ cash, Troy and Lily decide to withdraw ​$2 comma 100 from their traditional IRA. They are both 40 years old. They are in a 35​% marginal tax bracket. What will be the tax consequences of this​ withdrawal?

Answers

Answer:

Calculate the tax consequence of withdrawal from retirement account.

T and L are 40 years old and decide to withdraw $2,100 from their IRA. They lie in a 35% marginal tax bracket.

Analysis

They are withdrawing some amount from their retirement fund. They have to pay the tax and penalty for early withdrawals from the retirement fund. The withdrawal amount is $2,100 so they have to pay tax on it. The tax rate will be 35% which is their marginal tax bracket.

Calculation of tax consequences if withdrawal amount is $2,100:

Ordinary income tax amount calculates by multiplying the withdrawal amount with the ordinary tax rate.

= $2100 × 35%

= $735

The withdrawal amount attracts the 10% penalty. So, the penalty amount is calculated as follows: Penalty on withdrawn funds calculates by multiplying the withdrawn funds with the percentage of penalty.

= $2100 × 10%

= $210

(NOTE: - T and L have to pay ordinary income tax along with the penalty on their withdrawal because they are withdrawing funds from their IRA before age 59.5.)

Total expenses include the tax amount and penalty charge on withdrawal amount. So, it is calculated as follows:

Total expenses =$735 + $210

Total expenses = $945

Conclusion

Therefore, T and L would incur a tax of $945 on their withdrawal. This $945 is the sum of income tax amount and penalty on withdrawal balance.

If you owned a small firm that had become somewhat established, but you needed a surge of financial capital to carry out a major expansion, would you prefer to raise the funds through borrowing or by issuing stock? Explain your choice.

Answers

Answer:

I would issue stock because it is cheaper than borrowing.

Explanation:

First of all, issuing stock does not represent the obligation to pay interest over a long period of time, which can become very expensive if market conditions become adverse. Besides, if the company is small, it probably does not have the most advantageous financial conditions according to the banks, and the interest rate could be relatively high.

Besides, borrowing would mean increasing the liabilities in the financial statements, which could make the company less attractive for future investors.

Issuing stock does have the disadvantage of dilluting control of the company, because now stockholders own a piece of the company and could demand changes in management, and a different company strategy.

Kroger, a grocery store chain, sells thousands of products from hundreds ofdifferent producers that are shipped through a variety of shipping companies
and stored at various warehouses facilities. The coordinated efforts with each
channel partner at each touch point takes efficiency and communication. In
order for the process to run smoothly, which three functions do channel
partners need to perform to efficiently flow products and titles to the
consumer to get payments back to producers?
O transactional, logistical, and facilitating functions
o facilitating, commercial, and institutional functions
logistical, commercial, and transactional functions

Answers

Answer:

transactional, logistical, and facilitating functions

Explanation:
Other Questions
<11{1[2(06)06]}> Reporter: A new campaign finance reform bill being considered by Congress would limit the amount of campaign contributions that political candidates can receive. However, a survey of candidates running for mayor, governor, and senate seats shows that not one of them favors the bill. Clearly, there is no desire among politicians to limit campaign contributions. Which one of the following points out the flaw in the reporter’s argument above?
Stanley Roper has $2,300 that he is looking to invest. His brother approached him with an investment opportunity that could give Patrick $4,800 in 4 years. What interest rate would the investment have to yield in order for Stanley’s brother to deliver on his promise? (Answer needs to be stated as a decimal. For example: .1192) Round to four decimal places.
Some random questions 4 you! - Part 4!1) If you were to have either of the animals in the picture's which would it be?2) Would you take it outside daily?3) Would you keep in inside a kennel/cage?4) If not where would you keep it? If so how would you decorate it?5) Would you play with it often?6) Would you rather sell it to a random guy that claims he's a Zoo Keeper for 2,800$? or keep it but have to give him 100$?Bonus!) Should I make a part 5?
Interest Payable. At its December 31 year-end, the company holds a mortgage payable that has incurred $1,125 in annual interest that is neither recorded nor paid. The company intends to pay the interest on January 7 of the next year.