6. A system anticipates that spending $300,000 on an advertising campaign will increase bed days by 650. The marketing department anticipates that each additional bed day will yield $2,100 in additional revenue and will increase costs by $1,700. The campaign a. will reduce profits by $40,000. b. will increase profits by $40,000. c. will increase profits by $90,000. d. will increase profits by $210,000
Answers
Answer:
a. will reduce profits by $40,000
Explanation:
A: TR - TC = 650 * 2,100 - [$300,000 + (650 * 1,700)]1,365,000 - 1,405,000 = $ - 40,000
Therefore, this campaign will reduce profits by $40,000
Final answer:
The advertising campaign would reduce profits by $40,000. This is calculated by subtracting the campaign cost and additional costs per bed day from the total revenue generated from bed days.
Explanation:
The subject of this question is the financial impact of a proposed advertising campaign on a system's profits. To determine the effect on profits, we need to calculate the difference between the anticipated additional revenue and the anticipated increased costs, and then subtract the cost of the advertising campaign.
In this scenario, the total additional revenue from 650 bed days, at $2,100 each, would be $2,100 x 650 = $1,365,000. The total additional costs from these bed days would be $1,700 x 650 = $1,105,000. Subtracting costs from revenue, we have $1,365,000 - $1,105,000 = $260,000. Finally, we subtract the cost of the campaign, $260,000 - $300,000 = -$40,000. So, the advertising campaign would reduce profits by $40,000. Therefore, the correct choice is (a).
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Related Questions
The balance of stockholders' equity at the beginning of the year and the end of the year was $ 45 comma 000 $45,000 and $ 64 comma 000 $64,000?, respectively. The company issued no common stock during the year. Dividends were $ 25 comma 000 $25,000. What was the net income or loss for the? year? A. Net loss of $ 89 comma 000 $89,000 B. Net income of $ 44 comma 000 $44,000 C. Net income of $ 89 comma 000 $89,000 D. Net loss of $ 44 comma 000 $44,000 Converse Florists? & Co. reported assets of $ 1 comma 100 $1,100 and equity of $ 300 $300. What is its debt? ratio? (Round your percentage answer to two decimal? places.) A. 77.73 77.73% B. 27.27 27.27% C. 72.73 72.73% D. 100.00%
4Select the correct answer.What is the term for protection that guarantees payment to you in the event of financial loss?Ο Α.claimB.insuranceC.premiumResetNext
Tanya is the night supervisor for a data processing company. She supervises 26 workers who perform routine jobs that require minimal training. Which of the following statements would indicate that Tanya is following the transformational model of leadership?Multiple Choice:O Tanya wants to develop a partnership with his team illustrated by reciprocal influence, mutual trust, respect and liking, and a sense of common fates.O Tanya seeks to motivate employees to pursue organizational goals above their own self-interests.O Tanya likes to provide the guidance and support needed by employees and ties meaningful rewards to completion of objectives.
Which of the following factors has the LEAST influence on an individual’s core belief system? a. Physical appearance c. Religious background d. Family upbringing e. Life experiences Personality
Answers
Answer:
125%
Explanation:
The computation of predetermined overhead rate is shown below:-
Manufacturing overhead = $4,090 - ($570 + $370 + $600 + $800)
= $4,090 - $2,340
= $1,750
Total direct labor = $600 + $800
= $1,400
Manufacturing overhead = Predetermined overhead rate × Direct labor
Predetermined overhead rate = Manufacturing overhead ÷ Direct labor
= $1,750 ÷ $1,400
= 125%
Therefore for computing the predetermined overhead rate we simply divide the manufacturing overhead by direct labor.
b. 54,708 galleons
c. 106,080 galleons
d. 111,209 galleon
Answers
Answer:
d. 111,209 galleon
Explanation:
We calculate for the future value of a lump sum:
Principal 78,000.00
time 12.00
rate 0.03000 (3% = 3/100 = 0.03)
Amount 111,209.35
This is the amount Harry will get when visit the bank with Hagrid in his 12th birthday assumming the interest rate keep constant over the 12 years period.
Answers
Answer:
Porter's theory of national competitive advantage argues that the four general attributes of a nation form an environment in which local companies compete, and that these attributes contribute to or hinder the creation of competitive advantage. These attributes are: safety factor, demand conditions, related and support industries, as well as the company's strategy, structure and competence. Porter goes on to argue that companies are likely to succeed in industries where diamond (which is the four attributes) is favorable. Porter adds two factors to the list of attributes described above: randomness and public policy. The New Theory of Trade addresses a separate topic. This theory asserts that due to substantial economies of scale, global demand will only support a few companies in many industries. At the core of this argument is the concept of pioneering benefits, which are the economic and strategic benefits obtained by the first participants in the industry. It can be argued that when the attributes of a nation contribute to the production of a product, and when the manufacturers of this product experienced some "random" events that gave them a pioneering advantage, this nation's government policy should help create an advantage. national competitive in this particular area. This can be accomplished with government research and development grants, policies that favor the industry in capital markets, educational policies, creating a supportive regulatory environment, reducing taxes, and the like. Ask your students if they think this policy goes against the basic philosophy of free trade. It can be argued that this is so because government intervention creates the basis for comparative advantage. Conversely, it can be argued that if a country establishes a comparative advantage in a specific area based on a single set of attributes (such as Swiss watchmaking), global production will have a beneficial effect if this country is allowed to continue its area comparative. advantage.
Final answer:
Government policies can help harness the benefits of the new trade theory and Porter's theory of national competitive advantage, potentially driving national competitive advantage in the biotechnology sector. However, these policies, if involving protectionist measures, can be at variance with the principle of free trade.
Explanation:
Drawing upon the new trade theory and Porter's theory of national competitive advantage, government policies can play a pivotal role in building a national competitive advantage in the biotechnology sector. According to new trade theory, countries can benefit from specialising in the production of certain goods and services wherein they can achieve economies of scale and network effects. In the case of the biotechnology sector, this could be encouraged through policies in the form of research and development grants, tax incentives for biotech firms, and investment in infrastructure and education related to biotechnology.
Porter's national competitive advantage framework suggests that government's role in creating a conducive 'diamond' of factor conditions, demand conditions, related and supporting industries, and firm strategy, structure and rivalry is crucial. Here, establishing strong university-industry collaborations, rigorous regulations to maintain quality, and national guidelines for biotech firms can be steps forward.
However, these suggested policies of promoting a certain industry might seemingly be at odds with the philosophy of free trade, which advocates for minimal government intervention and open markets for all goods and services. It may be seen as a move towards 'protectionism', particularly if the policies involve subsidies or tariff barriers to protect domestic biotechnology firms from foreign competition.
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*The capital structure is 40% debt and 60% equity
*The before-tax cost of debt (which includes flotation costs) is 20% and the firm is in the 40% tax bracket
*The firm’s beta is 1.7
*The risk-free rate is 7% and the market risk premium is 6%
Answers
Answer:
Option (B) is correct.
Explanation:
Cost of Equity (Ke) = Rf + Beta ( Rp)
where,
Rf = risk free rate
Rp = Market risk premium
Hence,
Beta systematic risk:
= 7% + 1.7 (6%)
= 7% + 10.2%
= 17.2%
Post Tax cost of debt:
= Kd ( 1 - T)
where,
Kd = cost of debt
T = tax rate
= 20% * (1-0.4)
= 12%
WACC = [ (Ke × We) + (Wd × Kd(1-T)) ]
where,
We = weight of equity
Wd = weight of debt
= [(17.2% × 0.6) + (0.4 × 20% × (1 - 0.4))]
= 10.32% + 4.80%
= 15.12%
Production 30,000 units 24,000 units
Machine-hours 15,000 hours 10,800 hours
Variable overhead cost per machine-hour: $12.00 $11.25
What is the variable overhead efficiency variance?
a. 51890 favorable
b. $34,830 unfavorable
c. $36.720 unfavorable
e. 512.240 unfavorable
Answers
Answer:
Variable overhead efficiency variance= $14,400 favorable
Explanation:
Giving the following information:
Budgeted Actual
Production 30,000 units 24,000 units
Machine-hours 15,000 hours 10,800 hours
Variable overhead cost per machine-hour: $12.00 $11.25
To calculate the variable overhead efficiency variance, we need to use the following formula:
Variable overhead efficiency variance= (Standard Quantity - Actual Quantity)*Standard rate
Variable overhead efficiency variance= (12,000 - 10,800)*12
Variable overhead efficiency variance= $14,400 favorable
Answers
Answer: Ethical Egoism
Explanation:
The theory of Ethical Egoism posits that people or entities are well within their rights to act in a manner that benefits their best interest and in so doing are being good in their own right.
The small bank acted in such a manner that it left itself unexposed to risk whilst still making quite a huge profit. The small bank pursued its own interests and so followed the moral theory of Ethical Egoism.
Final answer:
The bank is operating under the moral theory of Moral Egoism. It acts in its own best interest by making large profits off the home loans and offloading the long-term risk.
Explanation:
The bank's actions seem to align with the Moral Egoism theory. This theory suggests that an entity, in this case, the bank, acts in its own best interest. Offering home loans at extremely low initial rates turns in large profit for the bank, which is its main interest. However, offloading the risk of these loans onto another bank marks the bank's primary focus on their well-being rather than the consequences for their customers in the long run. These customers may struggle if the larger bank they deal with lacks flexibility in difficult situations.
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