Answer: Increase by $29,058
Explanation:
A firm's net working capital is the Current Assets less the current liabilities.
From the above, the current assets are; inventory and accounts receivable.
Current Assets
= 38,991 + 31,869
= $70,860
Current liabilities = Accounts payable = $41,802
Net effect on working capital
= 70,860 - 41,802
= $29,058
Sunland Taxi Service uses the units-of-activity method in computing depreciation on its taxicabs. Each cab is expected to be driven 145,000 miles. Taxi 10 cost $29,500 and is expected to have a salvage value of $500. Taxi 10 was driven 32,000 miles in 2021 and 30,100 miles in 2022.
Answer:
see below
Explanation:
Under the unit of depreciation method, depreciation expense is per unit used.
The calculation of depreciation expense per unit is as per the formula.
DE per unit (Asset Cost − Salvage Value)/ Estimated Production Output
For Tax 10:
=($29,500- $500 ) /145,000 miles
= $29,000/145,000
=$0.2
The depreciation expense is $0.2 per mile.
Depreciation for 2021 will be depreciation per mile multiplied by miles driven.
=32,000 x $0.2
=$6,400
Depreciation for 2022
=30100 x $0.2
=$6,020
Rodriguez Company pays $342,225 for real estate with land, land improvements, and a building. Land is appraised at $250,000; land improvements are appraised at $75,000; and a building is appraised at $175,000.
Required:
a. Allocate the total cost among the three assets.
b. Prepare the journal entry to record the purchase.
Answer:
a. The cost of each of the assets will be proportional based on their individual costs.
Total individual costs = 250,000 + 75,000 + 175,000
= $500,000
Cost of land = 250,000/500,000 * 342,225 = $171,112.50
Cost of land improvements = 75,000/500,000 * 342,225 = $51,333.75
Cost of building = 175,000/500,000 * 342,225 = $119,778.75
b.
DR Land $171,112.50
Land Improvements $51,333.75
Building $119,778.75
CR Cash $342,225
Suppose that the dollar-mark 6 months forward rate is $1.275/Mark. Suppose that the dollar-mark forward premium is 5%. Calculate the spot rate, $1=Mark_______ work to 4 decimal places.
Answer:
$1 = 0.8039 Mark
Explanation:
Forward Rate = Spot rate * (1 +rate*180/360)
1.275 = Spot rate * (1 + 0.05*180/360)
Spot rate = $1.2439/Mark
Now we are asked rate per dollar
$1 = (1/1.2439)Mark
$1 = 0.8039 Mark
What is product positioning
Answer:
There are positioning to be brought by a client
To exploit an expected increase in interest rates, an investor would most likely:_______.a. sell Treasury bond futures. b. take a long position in wheat futures.
Answer:
a. sell Treasury bond futures
Explanation:
To exploit an expected increase in interest rates, an investor would most likely sell Treasury bond futures. Since treasury bond prices are inversely related to interest rates, an increase in interest rates will cause a decline in price of treasury bonds. By selling Treasury Bond futures, investor will have short position which will benefit from the increase in interest rates.
Sam is evaluating a stock that is expected to pay a $1.64 per share dividend at the end of the current year. He expects the dividend to grow by 3.8% per year and has determined that 11% is an appropriate required return for the stock. What is the highest amount he should pay for the stock?
Answer:
10,900
Explanation:
On November 19, Hayes Company receives a $15,000, 60-day, 10% note from a customer as payment on his account. What adjusting entry should be made on the December 31 year-end?
A) Debit Interest Receivable $175; credit Interest Revenue $175.
B) Debit Interest Receivable $250; credit Interest Revenue $250.
C) Debit Interest Receivable $75; credit Interest Revenue $75.
D) Debit Interest Revenue $175; credit Interest Receivable $175.
E) Debit Interest Revenue $250; credit Interest Receivable $250.
Answer:
A) Debit Interest Receivable $175; credit Interest Revenue $175.
Explanation:
The adjusting entry that made as on December 31 is shown below;
Interest receivable Dr $175
To Interest revenue $175
(Being the interest receivable is recorded)
The computation is shown below:
= $15,000 × 10% × 42 days ÷ 360 days
= $175
The 42 days are from November 19 to December 31
Here the interest receivable is debited as it increased the assets and credited the interest revenue as it also increased the revenue
Quilcene Oysteria farms and sells oysters in the Pacific Northwest. The company harvested and sold 7,200 pounds of oysters in August. The company’s flexible budget for August appears below:
Quilcene Oysteria
Flexible Budget
For the Month Ended August 31
Actual pounds (q) 7,200
Revenue ($4.20q) $30,240
Expenses:
Packing supplies ($0.35q) 2,520
Oyster bed maintenance ($3,300) 3,300
Wages and salaries ($2,000 + $0.35q) 4,520
Shipping ($0.65q) 4,680
Utilities ($1,290) 1,290
Other ($460 + $0.01q) 532
Total expense 16,842
Net operating income $13,398
The actual results for August were as follows:
Quilcene Oysteria
Income Statement
For the Month Ended August 31
Actual pounds 7,200
Revenue $27,200
Expenses:
Packing supplies 2,690
Oyster bed maintenance 3,160
Wages and salaries 4,930
Shipping 4,410
Utilities 1,100
Other 1,152
Total expense 17,442
Net operating income $9,758
Required:
Compute the company’s revenue and spending variances for August.
Answer:
Quilcene Oysteria
Computation of revenue and spending variances for August:
Flexible Actual Variance
For the Month Ended August 31
Actual pounds (q) 7,200 7,200 None
Revenue ($4.20q) $30,240 27,200 $3,040 U
Expenses:
Packing supplies ($0.35q) 2,520 2,690 -170 U
Oyster bed maintenance ($3,300) 3,300 3,160 140 F
Wages and salaries ($2,000 + $0.35q) 4,520 4,930 -410 U
Shipping ($0.65q) 4,680 4,410 270 F
Utilities ($1,290) 1,290 1,100 190 F
Other ($460 + $0.01q) 532 1,152 -620 U
Total expense 16,842 17,442 -600 U
Net operating income $13,398 $9,758 -3,640 U
Explanation:
Quilcene Oysteria 's budget comparison with actual performance shows that there is an unfavorable variance of $3,640 arising from the less than impressive sales revenue and excessive spending incurred during August. The firm realized less revenue than budgeted and incurred more expenses than budgeted. The result is this unfavorable variance of $3,640.
On June 1, 2018, Marigold Company and Swifty Company merged to form Nash Inc. A total of 769,000 shares were issued to complete the merger. The new corporation reports on a calendar-year basis. On April 1, 2020, the company issued an additional 599,000 shares of stock for cash. All 1,368,000 shares were outstanding on December 31, 2020. Nash Inc. also issued $600,000 of 20-year, 8% convertible bonds at par on July 1, 2020. Each $1,000 bond converts to 36 shares of common at any interest date. None of the bonds have been converted to date. Nash Inc. is preparing its annual report for the fiscal year ending December 31, 2020. The annual report will show earnings per share figures based upon a reported after-tax net income of $1,688,000. (The tax rate is 20%.)
Determine the following for 2020:
a. Basic earnings per share.
b. Diluted earnings per share.
c. The earnings figures to be used for calculating:
d. Basic earnings per share.
e. Diluted earnings per share.
Answer:
a. Basic earnings per share.
weighted average outstanding:
January 1 = 769,000 stocks
April 1 = 599,000 x 9/12 = 449,250 stocks
total weighted average outstanding stocks = 1,218,250 stocks
basic earnings per share = $1,688,000 / 1,218,250 = $1.3856 ≈ $1.39
b. Diluted earnings per share.
diluted shares = ($600,000 / $1,000) x 36 stocks x 1/2 = 10,800
diluted earnings per share = $1,707,200 / (1,218,250 + 10,800) = $1,707,200 / 1,229,050 = $1.389 ≈ $1.39
c. The earnings figures to be used for calculating:
Basic earnings per share
= net income = $1,688,000
Diluted earnings per share
= net income + interests saved - taxes on interests saved = $1,688,000 + $24,000 - $4,800 = $1,707,200
Companies often use features to differentiate themselves from competitors. However, a company must balance the features customers want with ________.
A) what the competition offers
B) the ability to manufacture the feature in a timely way
C) what customers will pay
D) the configurations that make a positive brand look stylish
E) the resources available for production
Answer:
C)what customers will pay
Explanation:
Effective Annual Rate A loan is offered with monthly payments and a 8 percent APR. What's the loan's effective annual rate (EAR)?
Answer:
The loan's effective annual rate (EAR) is 8.30%.
Explanation:
Effective Annual Rate (EAR) can be described as an interest rate which been adjusted for compounding over particular period.
EAR therefore simply refers to the interest rate paid to an investor in a year after taking compounding into consideration.
The EAR can be computed using the following formula:
EAR = ((1 + (i / n))^n) - 1 .............................(1)
Where;
i = Annual percentage rate (APR) = 8%, or 0.08
n = Number of compounding periods or months in a year = 12
Substituting the values into equation (1), we have:
EAR = ((1 + (0.08 / 12))^12) - 1
EAR = ((1 + 0.00666666666666667)^12) - 1
EAR = 1.00666666666666667^12 - 1
EAR = 1.08299950680751 - 1
EAR = 0.08299950680751, or 8.299950680751%
Approximating to 2 decimal places, we have:
EAR = 8.30%
Therefore, the loan's effective annual rate (EAR) is 8.30%.
Paul agrees to sell his clothing store to Michael and, as part of the sale, to execute a covenant not to compete promising not to open a similar store within one thousand miles for the next twenty years. A court reviewing the terms of the covenant would likely find that it is:________. a) unenforceable because all covenants not to compete are unreasonable. b) unreasonable as to both geographical scope and duration c) unreasonable with regard to duration d) enforceable
Answer:
d) enforceable
Explanation:
A court reviewing the terms of the covenant would likely find that it is enforceable. This is a standard clause found in many contracts and is also known as Non-compete clause. It is standard because a seller that has the experience of running a similar business can sell the business collect the profit from the sale and open create another similar business with little to no capital and quickly outperform their previous business due to the amount of experience that they have. In order to prevent this, many buyers require this clause to be added to the sales contract.
Mounts Corporation produces and sells two products. In the most recent month, Product I05L had sales of $32,000 and variable expenses of $10,880. Product P42T had sales of $45,000 and variable expenses of $18,380. And the fixed expenses of the entire company were $46,070. The break-even point in sales dollars for the entire company is closest to
A. $75,330
B. $74,306
C. $30,930
D. $46,070
Answer:
B. $74,306
Explanation:
First, we need to calculate contribution margin for both.
Product 105L
Sales $32,000
Less variable expenses ($10,880)
Contribution margin $21,120
Contribution margin ratio = Contribution margin ÷ Sales
= $21,120 ÷ $32,000
= 66%
Product P42T
Sales $45,000
Less variable expenses ($18,380)
Contribution margin $26,620
Contribution margin ratio = Contribution margin ÷ Sales
= $26,620 ÷ $45,000
= 59.2%
Total sales for both products $77,000
Less Total variable expenses ($29,260)
Total contribution margin $47,740
Total contribution margin ratio $47,740 ÷ $77,000 = 62%
Fixed expenses for both companies = $46,070
Therefore,
Break even point in sales for both companies = Total fixed expenses ÷ Contribution margin ratio
= $46,070 ÷ 62%
= $74,306.45
You own a bond that pays $64 in interest annually. The face value is $1,000 and the current market price is $1,062.50. The bond matures in 30 years. What is the yield to maturity? (round your answer to two decimal places)
Answer:
the yield to maturity of this bond is 5.7%
Explanation:
given data
pays interest annually C = $64
face value F = $1,000
current market price P = $1,062.50
bond matures n = 30 years
solution
we get here yield to maturity that is express as
yield to maturity =
yield to maturity = [C+ (F-P) ÷ n] ÷ [(F+P) ÷ 2 ] .................1
put here value and we get
yield to maturity = [tex]\frac{64+(1000-1062.50)}{11}[/tex] ÷ [tex]\frac{(1,000+1,062.50)}{2}[/tex]
yield to maturity = 0.057
so that the yield to maturity of this bond is 5.7%
Logano Driving Schoolâs 2017 balance sheet showed net fixed assets of $2.4 million, and the 2018 balance sheet showed net fixed assets of $3.3 million. The companyâs 2018 income statement showed a depreciation expense of $319,000.What was net capital spending for 2018? (Do not round intermediate calculations and enter your answer in dollars, not millions of dollars, e.g., 1,234,567.)
Answer:
$1,219,000
Explanation:
Calculation for the net capital spending for 2018
Using this formula
2018 Net capital spending=(2018 Net fixed assets-2017 Net fixed assets)+Depreciation expense
Let plug in the formula
2018 Net capital spending=($3,300,000-$2,400,000)+$319,000
2018 Net capital spending=$900,000+$319,000
2018 Net capital spending=$1,219,000
Therefore the 2018 Net capital spending will be $1,219,000
5. Suppose you are working in a ceramics factory and you are constructing control chart for an critical feature with batches of very fragile parts that common get broken during the measurements. You always start with 8 parts, but sometimes a few of them are broken while measuring them. What type of control chart would you construct and why
Explanation:
Analyzing the above scenario, the ideal type of control chart for construction would be the EWMA control chart integrated with the VSS and VSI control, because unlike traditional charts, it considers the variable sample size (VSS) and the variable sampling interval ( VSI) and therefore are more effective in considering the variations in the process in the control, which was what happened in the question above, since during the process of building the control chart there are some changes resulting from the breaking of the ceramic pieces, so it is ideal to build a graph that detects the changes in a more complete way.
The Carbon coal company has 2 mines, a surface mine ad a deep mine. it costs $200 per day to operate the surface mine and $250 to operate the deep mine. Each mine produces a medium grade and a medium-hard grade coal, but in different proportions. This surface mine produces 12 tons of medium grade and 6 tons of medium-hard grade coal per day, and the deep mine produces 4 tons of medium grade and 8 tons of medium-hard grade coal every day. The company has a contract to deliver at least 600 tons of medium grade and 480 tons of medium-hard grade coal within 60 days. How many days should each mine be operated so that the contract can be filled at minimum cost
Answer:
The company should operate the surface mine for 40 days and the deep mine for 30 days. Total costs = $15,500
Explanation:
we have to minimize the following equation: 200S + 250D
where:
S = surface mine
D = deep mine
the constraints are:
12S + 4D ≥ 600 (medium grade coal constraint)
6S + 8D ≥ 480 (medium hard coal constraint
S ≤ 60
D ≤ 60
S, D ≥ 0
S, D are integers
using solver, the optimal solution is 40S + 30D = $15,500
An annuity pays $500 every six months for 5 years. The annual rate of interest is 8% convertible semiannually. Find each of the following: (a) The PV of the annuity six months (one period) before the first payment, (b) the PV of the annuity on the day of the first payment, (c) the FV of the annuity on the day of the last payment, (d) and the FV of the annuity six months after the last payment.
Answer:
(a) The PV of the annuity six months (one period) before the first payment,
PV ordinary annuity = $500 x 8.1109 (PV annuity factor, 10 periods, 4%) = $4,055.45
(b) the PV of the annuity on the day of the first payment,
PV annuity due = $500 x 8.43533 (PV annuity due factor, 10 periods, 4%) = $4,217.67
(c) the FV of the annuity on the day of the last payment,
FV = $500 x 12.00611 (FV annuity factor, 4%, 10 periods) = $6,003.06
(d) and the FV of the annuity six months after the last payment.
FV = $6,003.06 x (1 + 4%) = $6,243.18
On November 1, 2021, a company signed a $100,000, 6%, six-month note payable with the amount borrowed plus accrued interest due six months later on May 1, 2022. The company should report interest payable at December 31, 2021, in the amount of:___________. a. $ 0. b. $2,000 c. $3,000.d. $1,000
Answer:
The interest payable to be reported on 31 December 2021 will be of $1000.
Option d is the correct asnwer.
Explanation:
Under the accrual basis or principle of accounting, we match the revenue with the expenses and record the transactions in the period to which they relate to rather than when the cash is paid or received. This means that the interest payment that is accrued for time period relating to this year should be recorded as an expense in the current period and as a liability as it will be paid in the next period. Thus, the interest on the note relating to 2 months from November 2021 to December 2021 will be recorded as follows,
Interest expense = 100000 * 0.06 * 2/12 = 1000
31 Dec 2021
Interest expense 1000 Dr
Interest Payable 1000 Cr
Roland had revenues of $601,000 in March. Fixed costs in March were $212,520 and profit was $51,920. A. What was the contribution margin percentage?B. What monthly sales volume (in dollars) would be needed to break-even?
c. What sales volume (in dollars) would be needed to earn $169,420?
Answer: See explanation
Explanation:
Revenue = $601,000
Fixed costs = $212,520
Profit = $51,920
A. A. What was the contribution margin percentage?
Contribution margin will be calculated as:
= (Fixed cost + Profit) / Revenue
= ($212520 +$51920) / $601,000
= $264440 / $601000
= 44%.
B. What monthly sales volume (in dollars) would be needed to break-even?
The break even point sales will be:
= Fixed cost / Contribution margin
= $212520 / 44%
= $212520 / 0.44
= $483000
C. What sales volume (in dollars) would be needed to earn $169,420?
This will be:
= (FC+DP) / Contribution margin
= (212520 + 169420)/0.44
= $381940/0.44
= $868045.45
Speedy's, a fast food facility, offers products at lower prices than its competitors in the market and has a drive-through-only operation with no indoor seating. What strategy is Speedy's using to gain competitive advantage?A. A best-cost provider strategy B. A focused low-cost provider strategy C. A broad differentiation strategy D. A focused differentiation strategy E. A low-cost provider strategy
Answer:
The correct answer is the option B: A focused low-cost provider strategy.
Explanation:
To begin with, in the field of business and management this type of strategy known as "focused low-cost strategy" has the purpose to lower the cost of a product that is being sell in a niche market where the other competitors can not afford to lower much more the price so that will implicate that the first company who has the ability to do it will gain a competitive advantage. Moreover, the fact that the company has a drive-through-only operation will increase the fact that the consumers will have their food faster and not having to wait in line or lose any time, so all that will implicate that their are currently having an advantage over the competitors.
Effective teams have confidence in themselves and believe they can succeed. This confidence is called ________.
A) social facilitation
B) goal congruence
C) social loafing
D) team efficacy
E) self-serving bias
Answer:
D) team efficacy
Explanation:
Team efficacy can be defined as the joint or collective beliefs that the members of a team have in its capacity to effectively execute a specific project or task, accomplish its organizational set goals and objectives through the use of team efforts and skills.
Hence, effective teams have confidence in themselves and believe they can succeed. This confidence is called team efficacy because all the members of the team bring their own skills, viewpoints, experience, knowledge to achieve success.
Roberta is taking the final course in the fourth semester of the Veterinary Technician program. When she reads the final project instructions, she realizes she wrote a paper about the same topic in one of her second-semester courses. Since she's very busy and close to finishing her degree, since the original paper got an A, she wants to submit the same paper for her final project. Can Roberta submit the same paper?
Answer:
Answer is D because using the same assignment for more than one course is a self plagiarism
2 Dollar Essay
Explanation:
Roberta was not able to submit the same paper, because if same assignment is used then it will be considered as self-plagiarism because it plagiarism. Therefore, Option C is correct.
What is self-plagiarism?When a writer who republishes the work that is already available in form of written text, that work is either done by self or by someone else is known as self-plagiarism.
In simple words, a work which is done by a student that involves some or whole of previously done work and that is also without the permission of the professors is known as plagiarism.
An image is attached at the end for better understanding.
Therefore, Option C is correct.
Learn more about plagiarism from here:
https://brainly.com/question/4428183
#SPJ2
The Extreme Reaches Corp. last paid a $1.50 per share annual dividend. The company is planning on paying $3.00, $5.00, $7.50, and $10.00 a share over the next four years, respectively. After that the dividend will be a constant $2.50 per share per year forever. A) What is the market price of this stock if the market rate of return is 15 percent? Also estimate the dividend yield over the first year.
B) Continue from the previous problem. What is the market price of this stock in one year? What is the capital gains yield over the first year?
Im looking for help on part B, I have already completed part A but it would be helpful to check my answer. ($26.57/share)
Answer:
a)
Div₁ = $3
Div₂ = $5
Div₃ = $7.50
Div₄ = $10
Div₅ = $2.50
the terminal value at year 4 = $2.50 / 15% = $16.67
P₀ = $3/1.15 + $5/1.15² + $7.50/1.15³ + $26.67/1.15⁴ = $2.61 + $3.78 + $4.93 + $15.25 = $26.57
dividend yield over the first year = $3 / $26.57 = 11.29%
b)
P₁ = $5/1.15 + $7.50/1.15² + $26.67/1.15³ = $4.35 + $5.67 + $17.47 = $27.49
capital gains yield = ($27.49 - $26.57) / $26.57 = 3.46%
According to the video, what do Financial Analysts analyze? Check all that apply.
financial records
travel distances
insurance claims
a company's competitors
fraud
A-D
-financial records
-a company’s competitors
Answer:
Financial Records
A Company’s Competitors
Explanation:
I got it right on edge 2020 hope this helps!
Puget Sound Divers is a company that provides diving services such as underwater ship repairs to clients in the Puget Sound area. The company’s planning budget for May appears below:
Puget Sound Divers
Planning Budget
For the Month Ended May 31
Budgeted diving-hours (q) 300
Revenue ($420.00q) $126,000
Expenses:
Wages and salaries ($11,100 + $124.00q) 48,300
Supplies ($3.00q) 900
Equipment rental ($2,100 + $22.00q) 8,700
Insurance ($4,000) 4,000
Miscellaneous ($520 + $1.42q) 946
Total expense 62,846
Net operating income $63,154
Required:
During May, the company’s actual activity was 290 diving-hours. Complete the flexible budget for that level of activity.
Answer:
$60,458
Explanation:
Calculation to Complete the flexible budget for that level of activity
FLEXIBLE BUDGET
Flexible Budget(290 driving hours)
Revenue 121,800
(290*420)
Expenses:
Wages and salaries 47,060
($11,100 +290*$124.00q)
Supplies 870
($3.00q*290)
Equipment rental 8,480
($2,100 +290* $22.00q)
Insurance 4,000 (Fixed)
Miscellaneous 932
($520 + 290*$1.42q)
Total expense 61,342
Net operating income $60,458
(121,800-61,342)
Therefore the Flexible-budget Net operating income will be $60,458
Due to the efficiency of its supply chain as a result of technology and resourcefulness, Zara can deliver products to its stores quicker than their competitors with:_______.
A. reverse logistics.
B. less electronic data interchanges.
C. longer lead times.
D. shorter lead times.
E. more stockouts.
Answer:
D. shorter lead times.
Explanation:
Most of Zara's suppliers are actually working near Zara's headquarters in northern Spain. This increases production costs, but also increases supply chain efficiency. Daily sales reports are sent by all the stores around the world and headquarters then replenish the products that are selling in higher volumes. Lead times are extremely short, stockouts are very rare, and inventory levels are extremely low. It is basically a fashion industry version of Toyota's JIT.
The management of Kelso is considering the elimination of the Eastern Division. If the Eastern Division were eliminated, the direct fixed costs associated with this division could be avoided. Given these data, the impact on net income of dropping the Eastern division would be: a. $140,000 Decrease b. $70,000 Increase c. $240,000 Decrease d. $30,000 Increase
Answer:
I could not find the exact details required to solve this so I will use a similar question that you can reference;
The impact of dropping the Eastern division is;
= Consolidated operating income + Direct Fixed costs avoided - Contribution margin lost
= (-75,000 + 15,000) + 180,000 - ( 550,000 - 275,000)
= -60,000 + 180,000 - 275,000
= -$155,000
Loss of $155,000
A new raw material is available that will decrease the variable costs per unit by 20% (or $2.80). However, to process the new raw material, fixed operating costs will increase by $90,000. Management feels that one-half of the decline in the variable costs per unit should be passed on to customers in the form of a sales price reduction. The marketing department expects that this sales price reduction will result in a 5% increase in the number of units sold.
Required:
a. Prepare a projected CVP income statement for 2020, assuming the changes have not been made.
b. Prepare a projected CVP Statement 2020, assuming that changes are made as described.
Answer:
Missing words "Carey Company had sales in 2016 of $1,586,000 on 61,000 units. Variable costs totaled $854,000, and fixed costs totaled $450,000"
a. Particulars Total Amount($) Per Unit in ($)
Sales 1,586,000 26
Less: Variable cost 854,000 14
Contribution Margin 732,000 12
Less: Fixed cost 450,000 -
Profit 282,000
b. Sales = 61000 + 5% = 61000 + 3050 = 64050 units
Sales price = $26 - ($2.8/2) $1.4 = $24.6
Variable price = $14 - $2.8 = $11.2
Fixed cost = 450000 + 90000 = 540000
Particulars Total Amount($) Per Unit in ($)
Sales 1,575,630 24.6
Less: Variable cost 717,360 11.2
Contribution Margin 858,270 13.4
Less: Fixed cost 540,000 -
Profit 318,270
With this new plan, the profit increases by $26,270 ($318,270 - $282,000)
You are the strategic leader of a highly competitive electronics company, Anderson Inc. Anderson Inc. is a global leader in electronics sales to corporate and international customers. The competitive nature of the market is creating the need to implement new and well researched strategies and online tools in order to compete with another company that is taking contracts from your organization daily. This other company, Henkerson Inc., is offering products at a slightly lower cost. Their customer service ratings, however, are much lower than Anderson Inc.
Anderson’s customer service could be superior as a result of :_________
Answer:
The options are missing, so I looked for similar questions. The option that I believe is correct is:
A good reputation for having few OOS (out-of-stock) problems when fulfilling large orders.Customer service is extremely important in today's world were competition is fierce and global. The less competition, the less value customer service has, but companies from around the world compete against each other. E.g. if you do not like how some salespeople treat you at a certain store, you can go online and buy the same products from a retailer 2,000 miles away. You must always remember that keeping old customers happy and loyal is always much easier and cheaper than getting new customers.
In a B2B environment, costs are important, and any difference in costs is much more important because the quantities sold are larger. But if the company that sells the lower priced products offers a terrible customer service and is not able to fulfill orders in time, then B2B clients will leave them because time is money. Th elonger the lead time, the higher the stockout probabilities and you require a larger safety stock which costs money.