The cost structure of two firms competing in the same industry is represented by the following cost formulas: Company X = $2,276,000 + $50/ unit; Company Z = $1,052,000 + $98/unit. The selling price is $145 per unit for both companies. Required: 1. Calculate the indifference point between the two cost structures, that is, the amount of unit sales that produce exactly the same operating income for Company X and Company Z.
Answers
Answer:
Indifference point= 25,500
Explanation:
Giving the following information:
Company X = $2,276,000 + $50/ unit
Company Z = $1,052,000 + $98/unit
We need to find the indifference point where the two companies provide the same total cost.
We need to equal both cost equations:
2,276,000 + 50x = 1,052,000 + 98x
1,224,000 = 48x
25,500= x
x= number of units
To prove:
Company X = $2,276,000 + $50*25,500= $3,551,000
Company Z = $1,052,000 + $98*25,500= $3,551,000
Related Questions
Flounder Corporation began operations on January 1, 2020 when $230,000 was invested by shareholders of the company. On March 1, 2020, Flounder purchased for cash $101,000 of debt securities that it classified as available-for-sale. During the year, the company received cash interest of $8,900 on these securities. In addition, the company has an unrealized holding loss on these securities of $13,100 net of tax. Determine the following amounts for 2020: (a) net income, (b) comprehensive income, (c) other comprehensive income, and (d) accumulated other comprehensive income (end of 2020). (Enter negative amounts using either a negative sign preceding the number e.g. -15 or parentheses e.g. (15).)
The following data relates to Mangini Company's estimated amounts for next year. Estimated: Department 1 Department 2 Manufacturing overhead costs $320,000 $400,000 Direct labor hours 65,000 DLH 75,000 DLH Machine hours 2,000 MH 2,500 MHRequired:a. What is the company's plantwide overhead rate if machine hours are the allocation base? (Round your answer to two decimal places.)
Brian is studying the LML Process. He is learning about the connection between the brain and mind and is conceptualizing it in a specific sequence. The correct sequence is __________.mind, brain–mind interface, stimuli, brain stimuli, brain–mind interface, brain, mind brain–mind interface, stimuli, mind stimuli, brain, brain–mind interface, mind
Feb 26- received $300 from a customer as a down payment on work to be undertaken on repairs to a cell. Is that unearned revenue.
Answers
Answer:
$5,600
Explanation:
Data provided in the question:
Number of units of inventory sold = 400 units
Selling cost of the inventory = $40 each
Original cost of the inventory = $26 each
Now,
Total inventory cost of the units sold = 400 × $26
= $10,400
Total selling cost of the inventory sold = 400 × $40
= $16,000
Therefore,
Elenor’s gross profit on this transaction
= Total selling cost of the inventory sold - Total inventory cost of the units sold
= $16,000 - $10,400
= $5,600
Final answer:
Elenor's gross profit is calculated by subtracting the total cost of inventory from the total sales revenue. With 400 units sold at $40 each and a cost of $26 each, the gross profit is $5,600.
Explanation:
To calculate Elenor's gross profit on the transaction, we need to deduct the total cost of the inventory from the total sales revenue. First, we calculate the total sales revenue: 400 units sold at $40 each gives us $16,000. Next, we calculate the total cost of the inventory: 400 units purchased at $26 each costs Elenor $10,400.
Now, to find the gross profit, we subtract the total cost from the sales revenue: $16,000 - $10,400 = $5,600.
Therefore, Elenor's gross profit on this transaction is $5,600.
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b) false
Answers
The given statement is False Option(b) is correct.
What are work groups?
A Working group, or working party, is a group of specialists working together to accomplish indicated objectives. The groups are space explicit and center around conversation or action around a particular branch of knowledge.
A working group's presentation is comprised of the singular consequences of all its singular individuals. A group's presentation is comprised of both individual outcomes and aggregate outcomes. In enormous associations, working groups are predominant, and the attention is dependably on individual objectives, execution and accountabilities.
Working group individuals don't get a sense of ownership with results other than their own. Then again, groups require both individual and common responsibility. There is more data sharing, more group conversations and discussions to show up at a group choice The life expectancy of a working group can endure anyplace between a couple of months and quite a long while. Such groups tend to foster a semi extremely durable presence when the relegated task is achieved consequently the need to disband or gradually eliminate the working group when it has accomplished its objective.
Therefore Option(b) is correct.
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Answers
Answer:
The equivalent units of production for October are :
Raw Materials = 423,750
Conversion Costs = 418,500
Explanation:
Calculation of Equivalent Units of Production
1. Raw Materials
Ending Work In Process Inventory (25,000 × 71%) 17,750
Completed and Transferred (406,000 × 100%) 406,000
Equivalent Units of Production for Materials 423,750
2. Conversion Costs
Ending Work In Process Inventory (25,000 × 50%) 12,500
Completed and Transferred (406,000 × 100%) 406,000
Equivalent Units of Production for Materials 418,500
Answers
Answer:
Option E (143) is the appropriate solution.
Explanation:
According to the question,
The modified duration will be:
=
=
=
The percentage change in price will be:
=
= (%)
Now,
The EMOD will be:
=
= ($)
Or,
The EMAC will be:
=
= ($)
Hence,
⇒
⇒
Adjusted Trial Balance
December 31, 2014
Debit Credit
Cash $2,660
Accounts Receivable 2,140
Supplies 1,850
Equipment 15,900
Accumulated Depreciation-Equipment $ 3,975
Accounts Payable 3,310
Unearned Service Revenue 3,205
Common Stock 10,000
Retained Earnings 4,510
Dividends 1,000
Service Revenue 4,300
Supplies Expense 410
Depreciation Expense 2,420
Rent Expense 2,920
$29,300 $29,300
Using the information from the adjusted trial balance, you are to prepare for the month ending December 31:
1. An income statement.
2. A balance sheet.
3. A retained earnings statement.
Answers
Answer:
1.
Income Statement
$
Service Revenue 4,300
Less :Supplies Expense 410
Gross Income 3,890
Less :Depreciation Expense 2,420
Less :Rent Expense (2,920)
Net Loss 1,450
2.
Balance Sheet
Assets $
Non-Current Asset
Equipment (15,900-3,975) 11,925
Current Asset $
Cash 2,660
Accounts Receivable 2,140
Supplies 1,850
6,650
Total Asset 18,575
Common Stock 10,000
Retained Earnings 2,060
Liabilities
Current Liabilities $
Unearned Service Revenue 3,205
Accounts Payable 3,310
6,515
Total Equity and Liability 18,575
3.
Retained Earning Statement $
Retained Earning (at beginning) 4,510
Dividend Paid (1,000)
Net Loss for the year (1,450)
Retained Earning (at Ending) 2,060
Explanation:
1.
Income statement shows the profit or loss for the period by deducting all the expenses from the revenue. The net value from here transferred to retained earning in the balance sheet.
2.
Balance sheet shows the financial position of the company. It contains assets, equity and liabilities balance.
3.
Statement of retained earning shows the balance of retained earnings and adjust all the payments made to shareholders in the form of dividend and net profit or loss for the period.
Final answer:
The income statement shows a net loss of $1,450. The retained earnings statement is $2,060 after accounting for the net loss and dividends. The balance sheet shows a total of $18,575 in assets, $6,515 in liabilities, and $12,060 in stockholders equity.
Explanation:
We will first need to prepare the income statement, followed by the retained earnings statement, and finally the balance sheet.
1. Income Statement
Service Revenue: $4,300
Less Expenses:
Supplies Expense: $410
Depreciation Expense: $2,420
Rent Expense: $2,920
Total Expense: $5,750
Net Income (Service Revenue - Total Expense): -$1,450
2. Retained Earnings statement
Beginning Retained Earnings: $4,510
Add: Net Income: -$1,450
Less: Dividends: $1,000
Ending Retained Earnings: $2,060
3. Balance Sheet
Assets:
Cash: $2,660
Accounts Receivable: $2,140
Supplies: $1,850
Equipment: $15,900
Less: Accumulated Depreciation: $3,975
Total Assets: $18,575
Liabilities:
Accounts Payable: $3,310
Unearned Service Revenue: $3,205
Total Liabilities: $6,515
Stockholders Equity:
Common Stock: $10,000
Retained Earnings: $2,060
Total Stockholders Equity: $12,060
Total Liabilities and Stockholders Equity: $18,575
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Answers
Answer
The answer and procedures of the exercise are attached in a microsoft excel document.
Explanation
Please consider the data provided by the exercise. If you have any question please write me back. All the exercises are solved in a single sheet with the formulas indications.