Kenny, Inc., is looking at setting up a new manufacturing plant in South Park. The company bought some land six years ago for $7.7 million in anticipation of using it as a warehouse and distribution site, but the company has since decided to rent facilities elsewhere. The land would net $10.5 million if it were sold today. The company now wants to build its new manufacturing plant on this land; the plant will cost $21.7 million to build, and the site requires $920,000 worth of grading before it is suitable for construction. What is the proper cash flow amount to use as the initial investment in fixed assets when evaluating this project

Answers

Answer 1

Answer:

$33,120,000

Explanation:

Calculation for What is the proper cash flow amount to use as the initial investment in fixed assets when evaluating this project

Using this formula

Proper Cash Flow Amount = (Expected Cost of Selling + Cost of Building Manufacturing Plant + Cost of Grading)

Let plug in the formula

Proper Cash Flow Amount = ($10,500,000 + $21,700,000 + $920,000)

Proper Cash Flow Amount = $33,120,000

Therefore the proper cash flow amount to use as the initial investment in fixed assets when evaluating this project will be $33,120,000

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What is the overall rate of return on a $155,000 investment that returns 23% on the first $15,000 and 16% on the remaining money

Answers

Answer:

The overall rate of return is 16.67%

Explanation:

The computation of the overall rate of return is shown below:

= Actual amount return ÷ investment amount

= ($15,000 × 23% + $140,000 × 16%) ÷ ($155,000)

= ($3,450 + $22,400) ÷ ($155,000)

= ($25,850) ÷ ($155,000)

= 16.67%

Hence, the overall rate of return is 16.67%

We simply applied the above formula and the same is to be considered

Wellington Recycling recycles newsprint, cardboard, and so forth, into received packaging materials. For the coming year, Wellington estimates total manufacturing overhead to be $359,640. The managers are not sure if direct labor hours (estimated to be 9,990) or machine hours (estimated to be 7,982 hours) is the best allocation base to use for allocating manufacturing overhead. Wellington bids for jobs a 31 % markup over total manufacturing cost.After the new fiscal year began, Hollings Paper Supply asked Wellington Recycling to bid for a job that will take 1 ,975 machine hours and t ,700 direct labor hours to produce. The direct labor cost this will be $10 per hour, and the direct materials will total S25,500.

Required:
Compute the total job cost and price if Wellington decided to use direct labor hours as the manufacturing overhead allocation base for the year.

Answers

To calculate the total Job Cost, it is required to add direct Materials with direct Labor and applied overhead.

Computation total job cost

Although when before that first determine the predetermined overhead cost which is

Then = Estimated total manufacturing cost ÷ estimated labor hours

Then = $359,640 ÷ $9,990

After that = $36 per hour

Now the total cost is

Then = Direct material + direct labor + manufacturing overhead
Now, = $25,500 + 1,700 × $10 + $1,700 × $36
After that = $25,500 + $17,000 + $61,200
Then = $103,700

Now the bid price is

Then = Job cost - markup profit
Now = $103,700 - $103,700 × 31%
Then = $103,700 - $32,147
Then = $135,847

Find out more information about Total job cost here:

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Answer and Explanation:

The computation is shown below:

But before that first determine the predetermined overhead cost which is

= Estimated total manufacturing cost ÷ estimated labor hours

= $359,640 ÷ $9,990

= $36 per hour

Now the total cost is

= Direct material + direct labor + manufacturing overhead

= $25,500 + 1,700 × $10 + $1,700 × $36

= $25,500 + $17,000 + $61,200

= $103,700

Now the bid price is

= Job cost - markup profit

= $103,700 - $103,700 × 31%

= $103,700 - $32,147

= $135,847

Suppose the price of widgets rises from $5 to $7 and consumption of widgets falls from 25 widgets a month to 15 widgets. Calculate your price elasticity of demand of widgets. What can you say about your price elasticity of demand of widgets? Is it Elastic, Inelastic, or Unitary Elastic? Why? Please show your work.

Answers

Answer:

Unitary elastic

Elasticity of demand is unitary elastic because the absolute value of elasticity is equal to 1.

Explanation:

Elasticity of demand measures the responsiveness of quantity demanded to changes in price.

Elasticity of demand = percentage change in quantity demanded / percentage change in price

Percentage change in quantity demanded = (25 - 15) / 25 = 0.4 × 100 = 40%

Percentage change in price = ($5 - $7) / $5 = 0.4 × 100 = 40%

Elasticity of demand = 40% / 40% = 1

If coefficient of elasticity is equal to 1, demand is unit elastic. It means that a change in price has an equal efect on the quantity demanded. Quantity demanded has an equal and proportional change to changes in price.

I hope my answer helps you

Final answer:

The price elasticity of demand is calculated to be 1, indicating unitary elasticity. This means a percentage change in price leads to an equal percentage change in quantity demanded, which implies widgets have a proportional responsiveness to price changes.

Explanation:

The price elasticity of demand for widgets can be calculated using the formula: PED = (% Change in Quantity Demanded) / (% Change in Price)

To determine the percentage change in quantity demanded, subtract the new quantity (15 widgets) from the original quantity (25 widgets), divide by the original quantity, and multiply by 100. The calculation is: [(15 - 25) / 25] * 100 = -40%

The percentage change in price is calculated as: [(7 - 5) / 5] * 100 = 40%

Substituting these values into the formula gives: PED = (-40%) / (40%) = -1. Because we usually report price elasticity of demand as absolute values, we interpret it as 1 in absolute value terms.

Since the price elasticity of demand is 1, it indicates a unitary elasticity. This implies that a 1% change in price induces a proportionate 1% change in quantity demanded. So, as price increased, customers decreased their purchase of widgets proportionately.

Learn more about Price Elasticity of Demand here:

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A restaurant prepares 200.00 pizza slices and sells them at a rate of $12.00/slice. Expenses for the restaurant include raw material for pizza at $5.00 per slice, $103.00 for monthly rental and monthly insurance of $30.00. Lost sale are taken as $6.00 per unhappy customer. Leftover pizza can be sold for $2.00. The restaurant is open only for 25 days in a month. Today there was a party at nearby office so the demand for pizza went up to 223.00 slices. How much profit could the restaurant earn today?

Answers

Answer:

$1428

Explanation:

Profit = Total Revenue - total cost

total revenue = price x quantity sold

total cost = variable cost + fixed cost

total revenue = 223 x $12 = $2676

Variable cost = $5 x 223 = $1115

total fixed cost = $103.00 + $30.00 = $133.00.

Total cost = $1115 + $133 = $1248

profit = $2676 - $1248 = $1428

Stayman Co. declared a 30% stock dividend. This transaction A) Increases total equity and retained earnings. B) Decreases total equity and retained earnings. C) Has no effect on total equity or retained earnings. D) Has no effect on total equity but decreases retained earnings.

Answers

Answer:

D) Has no effect on total equity but decreases retained earnings.

Explanation:

Dividends refer to the distribution of profits to the common stock holders.

This is basically an appropriation of profits.

When dividends are declared, then the retained earnings are reduced and a liability is created.

Announcing and declaring a dividend is a right to claim dividend by shareholders.

Thus, it do not affect the equity at all, but a liability is created and the moment dividend is paid liability is settled.

pproximately how much should be accumulated by the beginning of retirement to provide a $2,500 monthly check that will last for 25 years, during which time the fund will earn 6% interest with monthly compounding?

Answers

Answer:

$388,017.16

Explanation:

The amount that shall be accumulated at the beginning of retirement to provide a $2,500 for the period of 25 years shall be determined through the present value of annuity formula which is mentioned below:

Amount that should be accumulated=R[(1-(1+i)^-n)/i]

In the given question

R=monthly check that will be received=$2,500

n=number of months during which monthly checks will be received=25*12=300

i=interest rate compounded monthly=6/12=0.50%

Amount that should be accumulated=2500[(1-(1+0.50%)^-300)/0.50%]

=$388,017.16

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