This is false. US GDP would include the cars made in Ohio by a Japanese car company but not cars made in Bolivia by a U.S. car company.
What is meant by GDP?GDP calculates the monetary value of the final goods and services—those purchased by the consumer—produced in a nation during a specific time period (say a quarter or a year). It accounts for all the output produced inside a nation's boundaries.
The total dollar worth of all finished products and services produced is known as GDP. A nation's GDP stands for gross domestic product. It gauges the entire ultimate market value
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12. A friend of yours is graduating college next month. He has had a credit card and student loans for the past few years, but he’s never bothered to check his credit report. B) Which sections of information in his credit report should he pay particular attention to given his situation?
It should be emphasized that a person's credit report is significant because it demonstrates their responsibility for repaying obligations.
A credit report is basically a thorough written account of a person's credit history. You can gain a better understanding of your current credit condition by checking your credit history and credit scores.
Checking your credit reports frequently might help you become more aware of what potential lenders might see. You can also find any erroneous or incomplete information by checking your credit reports.
I'll ask my pal to quickly check their credit report. The credit history of banks, credit card firms, etc. is displayed in the credit report. He should also pay attention to the account history section, which displays the balances, account status, and payment history.
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Mars's approach to social responsibility is best
described as:
A) Proactive
B) Accommodative
C) Defensive
D) obstructionist
Mars's approach to social responsibility is best described as: Proactive
What is viewed as moral way of behaving and exploitative way of behaving is quiz let?
Moral way of behaving is when individuals act in a decent, moral, fair, and legitimate way. Unscrupulous way of behaving is when individuals act in a terrible, corrupt, uncalled for, or unseemly way. Business morals characterize an organization's way of behaving as moral or dishonest.
Which moral standard looks at whether as a demonstration is predictable with people groups?
Moral relativism is the hypothesis that holds that profound quality is comparative with the standards of one's way of life. That is, whether an activity is correct or wrong relies upon the ethical standards of the general public in which it is rehearsed. A similar activity might be ethically right in one society however be ethically off-base in another.
What is the partner model of corporate social obligation?
The partner model of corporate social obligation contends that everybody has equivalent freedoms, and the genuine privileges of partners ought to restrict the activities of organizations. Strangely, this model perspectives investors not as proprietors yet rather as financial backers.
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What type of interest rates will a person with a credit score in the low to below 600 range be offered for a loan?
A. zero interest rates
B. will never get a loan
C. relatively low interest rates
D. relatively high interest rates
Zero interest rates of interest rates will a person with a credit score in the low to below 600 range be offered for a loan. A zero interest rate policy (ZIRP) is when a central bank sets its short-term interest rate objective at or near zero.
The purpose is to stimulate economic activity by encouraging low-cost borrowing and increased access to low-cost credit loan for businesses and individuals. Zero percent financing is normally reserved for borrowers with exceptional credit, which is defined as a credit score of 800 or higher. Before you begin looking for vehicle finance, you should review your credit reports on your own. There are never any interest charges during the introductory period.
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Which of these are long-term impacts of having a good credit history?
The lowest interest rates and costs for new loans and lines of credit are more likely to be available to you if you have a high credit score, and if you're looking for a mortgage, you may be able to save up to 1% in interest.
You have good credit if your credit score is high. You have terrible credit if your credit score is low. Scores for various businesses vary. Low scores are in the 300 range.
You are more likely to get approved for loans with the best terms, such as lower interest rates, larger loan amounts, and possibly fewer fees, the higher your credit score.
Your financial life depends heavily on your credit score. It is necessary for less obvious things like signing up for cellular phone service, renting a car, and possibly even landing a job, in addition to the more obvious ones like getting approved for a loan or credit card.
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What type of interest rates will a person with a credit score in the low to below 600 range be offered for a loan?
A. zero interest rates
B. will never get a loan
C. relatively high interest rates
D. relatively low interest rates
The relatively low interest rates interest rates will a person with a credit score in the low to below 600 range be offered for a loan.
So, if you're a borrower, the interest rate is the amount you pay for borrowing money, the expressed as a percentage of the entire loan credit amount. For example, if you borrow $100 at 5% interest, you will pay back $105 to the lender. The lender will earn by $5. Throughout your life, you may develop a variety of the interests. Every loan has its own interest rate, which is determines the total amount owed.
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Suppose that 17,000 is deposited for seven years awt 3% APR calculate the nearest interest earned if interest is compounded monthly round your answer to the nearest cent
The interest earned if 17,000 is deposited for 7 years with a 3% APR compounded monthly is $3,967,03.
What is the interest earned?If the account the money is deposited is compounded monthly, it means that both the amount that was deposited and the interest that has already accrued increases in value once a month over the seven years investment period.
The interest earned is the difference between the amount deposited and the future value of the money in the account.
Interest earned = future value - amount deposited.
The formula that can be used to determine the future value of the amount deposited is:
FV = P(1 + r)^(m x t)
Where:
FV = future value P = amount deposited r = interest rate = APR / number of compounding = 3% / 12 = 0.25%m = number of compounding = 12 t = number of years = 7FV = 17,000 x (1 + 0.0025)^(12 x 7)
FV = 17,000 x (1.0025)^84 = $20,967.03
Interest earned = $20,967.03 17,000 = $3,967,03
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essence of macroeconomics in an economy
The main essence of macroeconomics in an economy are help to focus on the performance of economies based on changes in economic output, inflation, interest and foreign exchange rates and the balance of payments.
What do we know as macroeconomics?Basically, a macroeconomics means the branch of economics that studies how an overall economy such as markets, businesses, consumers, and governments generally behave. The branch "macroeconomics" examines an economy-wide phenomena such as inflation, price levels, rate of economic growth, national income, gross domestic product (GDP) and changes in unemployment.
In other way, it is also the branch of economics that deals with the structure, performance, behavior and decision-making of the whole, aggregate or full economy.
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Analyse the effect of a rise in the price of tea on the demand for milk and the demand for coffee.
Due to the fact that tea and coffee are alternatives for one another, if the price of tea were to rise, so would the demand for coffee.
Effect of a rise in the price of tea:Products like tea and coffee are examples of substitute goods since they can be used in lieu of one another to satisfy a certain need. The price of a substitute good directly affects demand for a certain commodity. For instance, if the price of a replacement good (like coffee) rises, demand for the given commodity (like tea) will increase since tea will be comparably less expensive than coffee.
For instance, if the cost of tea is 20 rupees and the demand for coffee, a substitute, is 10 rupees. Currently, the price of tea is rising steadily by 30, 40, and 50 cents, while the demand for coffee is also rising steadily by 20, 30, and 40 cents.
If coffee and tea are comparable products and the price of coffee rises, people will drink less coffee and more tea. Tea will so become more popular as a result.
As a result, if the price of coffee rises, the price of tea will also increase (due to excess demand). Additionally, since tea is a coffee alternative, a rise in the price of coffee will also result in a rise in the demand for tea.
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What organizational structure has everything approved by the management?
centralized
divisional
decentralized
functional
Question 12
Which of the following transactions may NOT be reflected on your account balance if you go online to check your balances?
O ATM cash withdrawal from yesterday
O Check that you mailed to your cousin for his birthday today
Automatic payment for your car loan paid two days ago
O Debit card transaction from purchasing snacks at a local convenience store today
Check that you mailed to your cousin for his birthday today may NOT be reflected on your account balance if you go online to check your balances.
What is account ?In accounting, an account refers to a general ledger record used to sort and store balances. For example, a company has a cash account that records all balances that increase or decrease the company's cash. In macroeconomics, a financial account is the component of a country's balance of payments that covers claims or liabilities to non-residents, particularly in relation to financial assets. Components of the financial balance include direct investments, portfolio investments and reserve assets, and are grouped by sector. Accounting & Finance examines money, business and management. Accounting refers to the analysis of information about various aspects of a business, whereas finance is concerned only with an organization's funds.To learn more about account from the given link :
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Periodically, customers of a financial services company are asked to evaluate the company's financial consultants and services. Higher ratings on the client satisfaction survey indicate better service, with 7 the maximum service rating. Independent samples of service ratings for two financial consultants are summarized here. Consultant A has 10 years of experience, whereas consultant B has 1 year of experience. Use
= 0.05
and test to see whether the consultant with more experience has the higher population mean service rating.
Consultant A Consultant B
n1 = 16
n2 = 10
x1 = 6.82
x2 = 6.26
s1 = 0.65
s2 = 0.75
(a)
State the null and alternative hypotheses.
H0:
1 − 2 > 0
Ha:
1 − 2 ≤ 0
H0:
1 − 2 = 0
Ha:
1 − 2 ≠ 0
H0:
1 − 2 ≤ 0
Ha:
1 − 2 = 0
H0:
1 − 2 ≤ 0
Ha:
1 − 2 > 0
H0:
1 − 2 ≠ 0
Ha:
1 − 2 = 0
(b)
Compute the value of the test statistic. (Round your answer to three decimal places.)
(c)
What is the p-value? (Round your answer to four decimal places.)
Answer:
after all
w and data pro is the best solution
Explanation:
assumption that you are a very important thing
How does the microeconomic environment affect your daily life? What can you do to live a better life after completing this course? What was your biggest “take-away” from our class?
The microeconomic environment affects your daily life as they talk about the demand and the supply of the commodity and the prices.
What is the microeconomic environment?The term "microeconomic environment" describes variables that have an impact on certain businesses or consumers. They don't impact the entire business, but they might have had an impact on certain businesses.
Businesses use microeconomics to determine their rates or other strategic choices. Customers' willingness to pay a certain price is dependent on the availability of a certain commodity, like a home or a class, as well because of how lot other people are capable of paying for it.
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Amex Inc. is a worldwide company that specializes in high growth industries. It acts
as a global marketer for small manufacturers of medical products,
telecommunications, products, and data management products. Amex Inc. is an
example of a(n):
business trade union
O export management company
O domestic channel member
commission house broker
O export trading company
If Amex acts as a global marketer for small manufacturers of medical products, telecommunications, products, and data management products. Amex Inc. can be considered as an example of a(n):
A. Export management company
What is an export management company?An export management company can be regarded as a business entity that is charged with the responsibility of marketing the goods and services of manufacturers to importers of foreign origins. This fits the description of Amex Inc. described above.
We can see here that this institution is a global marketer for small manufacturers. It picks the products from the manufacturers and markets the same to importers that are in other countries. Export management companies also have the responsibility of researching the market on an international level and also representing the company in business gatherings.
Such a company as described above ships the product and manages other aspects of the exportation process such as documentation. The export company acts as a sales agent.
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Your cell phone plan is $35.98/ month plus a utilities tax of 6.5% APR. During the year, you go 40 minutes over your plan at a rate of $0.35/ minute. How much do you pay for overages?
The owner of the cell phone will be responsible for paying $14.91 for the overages.
Why is there an excess?
The overage is the discrepancy between actual minutes used and estimated minutes used.
For instance, if the plan anticipates 4,000 minutes of phone usage annually, but the plan holder uses 4,010 minutes, the additional 10 minutes are considered overages.
Underages is the polar opposite of overages. The plan holder will receive a refund if the phone plan includes minors.
Overages typically incur a variable plan cost per minute.
Fixed monthly fee equals $35.98
Utility tax APR is 6.5 percent.
40 minutes is the overage.
Rate per minute of overage is $0.35
($0.35 x 40) = $14 is the total amount for the overage.
The overage interest equals $0.91 ($14 x 6.5%)
$14.91 ($14 + $0.91) is the total amount paid for the overages.
Thus, you will pay $14.91 for the overages if you exceed the plan by 40 minutes at $0.35 plus an APR of 6.5%.
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Recruiting for field research will take a week longer than expected. However, Ria told you that the project end date is a hard deadline. What can you do?
Think of the triple constraint and remember that one of them will always have the priority. So if time is a constraint, what areas might Ria adjust to reduce
the time in the project? Write 2-3 sentences.
What do you think?
Your answer cannot be more than 10000 characters.
4. Situation 3
After the stakeholders are on the project scone Pis finde
Ria was able to adjust costs, and employ many recruitment techniques and new product ideas, technical constraints, and design considerations in order to speed up the project.
What is the time constraint in the project?Recruitment for field studies will take a week longer than expected. But Ria let you know that the project's completion date is a tight deadline. Note that given the 3 constraints, 1 of the 3 always takes precedence & she has Limited time only.In this case, a budget constraint is required to save costs.Additional ResourcesReduce project time and scope.Using Project Management ToolsTime is of the essence here. Various recruitment methods can be used to recruit within the limited time frame of field researchvirtual reality interviewsonline forums and social mediaembedding AI into websites such as LinkedIn.In this case, size is the limiting factor. Identify low-priority project components to make room for new product ideas, technical constraints, and design considerations.to know more about field study refer to:
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In a manufacturing company, which budget is used as the basis for creating the direct materials budget, the direct labor budget, and the manufacturing overhead budget?
In a manufacturing company, the budget which is used as the basis for creating the direct materials budget, the direct labor budget, and the manufacturing overhead budget is the Production budget.
The materials budget is used to plan how many raw materials we will need to have on the side in order to meet our production targets. This budget is prepared in the same manner as the production budget, as the company must decide how much raw materials inventory to keep on hand at the end of each quarter.
The direct labor budget is basic. Firstly, we need to know how many units are needed from the production budget. Then, we need to know how many direct labor hours are required to complete one unit, as well as the cost per labor hour.
The manufacturing overhead budget is the final budget for manufacturing. It is developed in accordance with how the company allocates overhead.
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what method of accounting does coca-cola company use
The coca cola company makes use of the equity method of accounting.
What is the equity method of accounting?A business uses the equity method as an accounting approach to record the earnings made by its investment in another business. The investor firm declares the revenue generated by the other company on its income statement using the equity method of accounting, in a proportional amount to the equity stake it has in the other company.
The net income of the invested firm raises the asset worth of the investor on their balance sheet while the invested company's net loss or dividend distribution lowers it.
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write 3-5 pages paper based on the below exercises from Mnagement prespective.
Assessing Your Attitudes toward Corporate Responsibility
Assessing Your Perspective on Ethics
Assessing Your Global Manager Potential
Assessing Your Career Vision and Plan
Assessing Your Core Skills Required for Strategic Planning
Assessing Your Decision-Making Style
Assessing Your Preferred Type of Organizational Culture
Assessing Your Person-Job Fit
Assessing How Adaptable You Are
Assessing Your Attitudes toward Teamwork
Assessing Your Readiness to Assume a Leadership Role
Assessing Your Communication Competence
Your outline should focus on the following questions:
What are my strengths? How will these strengths help me manage and work with others more successfully?
What are my weaknesses? How will these weaknesses, if not improved upon, get in my way of success?
What was I most surprised about in taking these assessments and why? What did I learn about myself that I did not know before taking the assessments?
How can I use this information going forward?
Formatting requirements:
3 to 5-page paper
Times New Roman, size 12, double-spaced
Which of the following are NOT the methods to achieve a
Continuous Flow in your business process?
A Prepare for Production Takt vs. Consumer Takt
B Push Production
C CONWIP
D Kanban
E None of the given choices
The methods to achieve a Continuous Flow in your business process are none of the given choices among the following options.
What is the flow of business?The term company refers to an organization or business entity engaged in commercial, industrial, or professional activity. The purpose of an enterprise is to organize some kind of economic production (of goods or services). A business can be a for-profit or non-profit organization that serves a charitable mission or promotes a social cause. Companies vary in size and scale from sole proprietorships to large international corporations.The business also refers to the efforts and activities of individuals who produce and sell goods and services for profit.examples of business are:amazonappleMicrosoftWalmartto know more about business refer to
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What are the major motivation issues at play in the health care industry according to the major needs-based theories of motivation. (Maslow’s need Hierarchy theory, McClelland’s acquired needs and Deci & Ryan’s self-determination)?
The major motivation issues that is at play in the health care industry according to the major needs-based theories of motivation is to get the first aid treatment to their health problems.
What is the Maslow’s Theory of Hierarchical Needs?Maslow's hierarchy of needs can be described as the model for understanding the motivations which is been used for the human behavior.
It should be noted that this helps to maps different motivations that is been arranged in different pyramid, having each level representing a different human need.
In conclusion, the Maslow’s Theory of Hierarchical Needs which was postulated stressed that the person will be motivated when all his needs are fulfilled and this can be applied to the health sector, where the people were expected to get the needs which involves finding solutions to their health problems.
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The following merchandise transactions occurred during December for two different companies: Rippen
and Burnen. Both companies use a perpetual inventory system.
On December 3, Rippen Corporation sold merchandise on account to Burnen Corp. for $480,000, terms
2/10, n/30. This merchandise originally cost Rippen $320,000.
On December 8, Burnen Corp. returned merchandise to Rippen Corporation for a credit of $30,000.
Rippen returned this merchandise to inventory at its original cost of $20,000.
December 12, Burnen Corp. paid Rippen Corporation for the amount owed.
Required:
a. Prepare the journal entries to record these transactions on the books of Rippen Corpo
11. Explain how numbers are sorted in consecutive numbering, terminal-digit numbering, and middle-digit numbering. (Obj. 5)
Consecutive numbering is used to organize the numbers from lowest to highest without interruption. The last few digits of a sequence are used in terminal-digit numbering to define the main key for sorting.
What is consecutive numbering?Generally, The term "consecutive numbers" refers to a series of numerical values that proceed one after the other without interruption in the ascending order of size. Examples of consecutive numbers include the following: 1, 2, 3, 4, 5, 6, and so on.
The use of consecutive numbering ensures that the numbers are presented in ascending order, starting with the lowest and working their way up to the highest.
In conclusion, When terminal-digit numbering is used, the primary key for sorting is determined by using the most recent few digits of a sequence.
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Which of the following duties is not a permitted activity for an unlicensed personal assistant?
a. Negotiate agreements regarding commission structuring.
b. Secure documents that are public information from the courthouse and other sources available to the public.
c. Have keys made for company listings.
d. Write advertisements and promotional materials with the approval of the licensee and supervising broker.
Negotiate agreement regarding commission structuring is not a permitted activity for an unlicensed personal assistant.
An unlicensed personal assistant would be permitted to host an open house while the licensed associate is showing another listing and try to negotiate an offer complete contract forms after the licensed associate has captured the important things like price and closing date show a property to a potential buyer when the licensed associate is busy and negotiate price and terms for their offer.
Unlicensed assistants cannot do licensed activities, such as negotiating, providing advise or signing contracts.Thus, option (a) is correct.
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Your friend offers to pay you an annuity of $9,200 at the end of each year for 3 years in return for cash today. You could earn 5-5% on your
Select the correct answer.
Oa. $24,820.99
O b. $24,801.79
O c. $24,811.39
O d. $24,830.59
Oe. $24,792.19
O Icon Key
The most that should be paid for the annuity is $24,820.99
How to calculate the present value of an ordinary annuity?
Since the annuity of $9,200 will be paid at the end of each year, the most that should be paid for the annuity can be calculated using the formula for calculating the present value of an ordinary annuity as follows:
PV = P * ((1 - (1 / (1 + r))^n) / r) …………………………………. (1)
Where;
PV = Present value or the most you should pay for the annuity = ?
P = Annuity payment = $9,200
r = Interest rate on other investment = 5.5%, or 0.055
n = number of years = 3
Substitute the values into equation (1), we have:
PV = $9,200 * ((1 - (1 / (1 + 0.055))^3) / 0.055) = $24,820.99
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Describe one advantage and disadvantage of the PESTEL analysis for strategic planning.
Answer:
PESTEL is a very simple framework that involves external factors that act as a necessity for every business.
let's understand its advantages and disadvantages:
ADVANTAGE:
1. Widens Horizon: It helps business to widen its horizon in order to keep a count of future discrepancies and opportunities.
DISADVANTAGE:
2. Based on assumptions: anticipation makes it a time taken a process that might not even result to be fruitful in long run.
On October 29, Lobo Company began operations by purchasing razors for resale. The razors have a 90-day warranty.
When a razor is returned, the company discards it and mails a new one from Merchandise Inventory to the customer. The
company's cost per new razor is $14 and its retail selling price is $80. The company expects warranty costs to equal 8% of
dollar sales. The following transactions occurred.
November 11 Sold 50 razors for $4,000 cash.
November 30 Recognized warranty expense related to November sales with an adjusting entry.
December 9 Replaced 10 razors that were returned under the warranty.
December 16 Sold 150 razors for $12,000 cash.
December 29
Replaced 20 razors that were returned under the warranty.
December 31 Recognized warranty expense related to December sales with an adjusting entry.
January 5 Sold 100 razors for $8,000 cash.
January 17
Replaced 25 razors that were returned under the warranty.
January 31 Recognized warranty expense related to January sales with an adjusting entry.
Problem 9-4A (Algo) Part 4
4. What is the balance of the Estimated Warranty Liability account as of December 31?
Estimated warranty liability balance
Warranty expense is an exp-ense related to the re-pair, replacement, or compens-ation to a user for any product defects. A vendor or manu-facturer is committed to repair or rep-lace a sold product if it breaks or does not func-tion properly according to the ter-ms of the warranty.
Balance of estimated warranty expense on December 31, 2016
Particulars Amount
Warranty expense for November $320
Warranty expense for December $960
Less: Cost of replacement ($420)
( $140 + $280 ) (140 = 10 * 14)+ (280 = 20 * 14)
Estimated warranty liability $860
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Assume the company’s tax rate is 23 percent.
Debt: 16,800 5.9 percent coupon bonds outstanding, $1,000 par value, 25 years to maturity, selling for 106.4 percent of par; the bonds make semiannual payments.
Common stock: 550,000 shares outstanding, selling for $81.75 per share; beta is 1.15.
Preferred stock: 21,500 shares of 4.15 percent preferred stock outstanding, currently selling for $91.30 per share. The par value is $100.
Market: 6.4 percent market risk premium and 2.9 percent risk-free rate.
What is the company's WACC?
The company's WACC (Weighted Average Cost of Capital) is 3.4%.
What is the Weighted Average Cost of Capital?The WACC (Weighted Average Cost of Capital) is the average rate that a company expects to pay to finance its assets.
The WACC includes all sources of financing, including common stock, preferred stock, bonds, and other forms of debt.
The WACC can be computed using the following formula: (weight of debt x after-tax cost of debt) + ( weight of common stock x cost of common stock) + (Weight of preferred stock x cost of preferred stock)
Debt:Tax rate = 23%
Market value = $16,800,000 (16,800 x $1,000)
Current market value = $17,875,200 ($16,800,000 x 1.064)
Maturity period = 25 years
Selling price = 106.4% of par
Bonds interest rate = 5.9% paid semiannually
Common Stock:Market value = $44,962,500 (550,000 x $81.75)
Beta = 1.15
Cost of equity = Risk-free rate of return + Beta * (market rate of return - risk-free rate of return)
= 2.9 + 1.15 x 6.4%
= 2.9 + 0.0736
= 2.9736%
Preferred Stock:Market value = $1,962,950 (21,500 x $91.30)
Rate = 4.15% (of $2,150,000)
Total market value of all financing = $64,800,650 ($17,875,200 + $44,962,500 + $1,962,950)
Weight of debt = 27.58% ($17,875,200/$64,800,650 x 100)
Weight of equity = 69.39% ($44,962,500/$64,800,650 x 100)
Weight of preferred stock = 3.03% ($1,962,950/$64,800,650 x 100)
WACC = (27.58% x 5.9% (1 - 23%) + (69.39% x 2.9736%) + (3.03% x 4.15%)
= (1.253 + 2.063 + 0.126)
= 3.442
= 3.4%
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lauren buys groceries every month from walmart and rarely does much research on the products she buys. what is the marketing term for this type of consumer behavior?
Routine response behavior is the marketing term for this type of consumer behavior.
Demographic segmentation is a specific form of target audience identity based totally on data factors like age, gender, marital popularity, family length, income, schooling, race, career, nationality, and/or faith. It's a few of the 4 predominant kinds of advertising segmentation, and possibly the maximum commonly used approach.
Effective segmentation must be measurable, accessible, sizeable, differentiable, and actionable. Whilst an organization has segmented its marketplace therefore, there is a higher threat that it turns into more worthwhile and successful ultimately.
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please help me find the last part of this question please
1. The percentage improvement needed in the supply chain strategy to for profit to improve to $25,000 is a 25% decrease in supply chain cost so that material cost becomes $45,000.
2. A 15% increase in sales is required to generate a profit of $25,000, making the sales revenue to become $115,000.
How are the percentages determined?For the supply chain improvement, to increase profit to $25,000, Hau Lee must reduce the cost of materials to $45,000 ($60,000 - $15,000).
This cost reduction translates to a 25% cost improvement ($15,000/$60,000).
For the sales strategy, Hau Lee can apply the break-even analysis to compute the sales revenue with the target profit.
Hua Lee Furniture, Inc.
Income Statements Current % Projection 1 % Projection 2 %
Sales $100,000 100 $100,000 100 $115,000 100
Cost of materials 60,000 60 45,000 45 60,000 52
Production costs 20,000 20 20,000 20 20,000 17
Fixed costs 10,000 10 10,000 10 10,000 9
Profits $10,000 10 $25,000 25 $25,000 22
Projection 1:
Required improvement in dollars to make profit of $25,000 = $15,000 ($25,000 - $10,000)
Improvement translates to 25% ($15,000/$60,000).
Projection 2:
Required improvement in dollars to make profit of $25,000 = $15,000 ($25,000 - $10,000)
Contribution margin ratio = 30.4% ($35,000/$115,000 x 100)
Break-even Sales = Fixed Costs + Target Profit/Contribution margin ratio
= $35,000/30.4%
= $115,000
Improvement in sales strategy = 15% ($15,000/$100,000 x 100)
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What’s the forecasted EBIT based on the information below? -
Revenues: 8,100
Cost of goods sold: 4,900
SG&A: 1,500
Depreciation: 400
Interest: 150
Taxes: 390
The forecasted EBIT based on the information given, equals to the amount of $1,300.
What is the meaning of Earnings before interest and taxes?In accounting, the earnings before interest and taxes refers to a company's net income before income tax expense and interest expenses are deducted, its also referred to as operating earnings, operating profit, and profit before interest and taxes. It is an indicator of a company's profitability. It is calculated as revenue minus expenses excluding tax and interest.
As a financial metrics, the earnings before interest and taxes is used to analyze the performance of a company's core operations without the costs of the capital structure and tax expenses impacting profit.
EBIT = Revenue − COGS − Operating Expenses
EBIT = 8100 - 4,900 - (1,500 + 400)
EBIT = 8100 - 4,900 - 1,900
EBIT = $1,300
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