Option C. The transaction expense shows as twice the amount he paid because he used the Write Checks window instead of the Pay Bills window.
The Payments window has been merged with the Write Checks window. Write Checks allows you to quickly enter check details without manually distributing each item.
The Pay Bills window contains a record of all payments made on your account. For actions marked as Pay for Purchases by Invoice, use the Pay Invoice window. The Pay Bills window contains a record of all payments made on your account. Invoices entered in the Enter Invoices window can be paid from the Activities window. In QuickBooks, deposits are entered in the Pay Bills window.
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D. He entered the bill twice.C. He used the Write Checks window instead of the Pay Bills window.To avoid this issue, Adam should use the Pay Bills window to pay the utility bill, as it will link the payment to the existing bill entered in the Enter Bills window.
Adam made a mistake by paying the utility bill using the Write Checks window instead of the Pay Bills window. When he entered the bill in the Enter Bills window, it created an expense in QuickBooks. By using the Write Checks window to pay the bill, he unintentionally created a second expense, resulting in the transaction expense showing twice the amount he actually paid. D. He entered the bill twice.
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if a parcel of land that was originally acquired for $85,000 is offered for sale at $150,000, is assessed for tax purposes at $95,000, is recognized by its purchasers as easily being worth $140,000, and is sold for $137,000, the land should be recorded in the purchaser's books at:
The purchaser should record the land in their books at $137,000, which is the price at which it was sold.
When recording an asset in the books, it is generally recorded at its cost. In this case, the cost of the land is not explicitly mentioned. However, since the land was sold for $137,000, it indicates that this is the amount the purchaser paid to acquire the land. Therefore, the purchaser should record the land in their books at $137,000.
It is important to note that the assessed value for tax purposes, the original acquisition cost, and the perceived value by the purchasers are not relevant when determining the recording value of the land. The actual price paid for the land is the most accurate and relevant figure to use for recording purposes. By recording the land at $137,000, the purchaser accurately reflects the amount they paid for the land and ensures that their financial statements reflect the true value of their assets.
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The land should be recorded in the purchaser's books at its purchase price, which is $137,000. This is because the purchase price is the actual amount paid for the land and is the most reliable indicator of its value.
While the land was offered for sale at $150,000, assessed for tax purposes at $95,000, and recognized by purchasers as worth $140,000, these values are not as relevant as the actual purchase price. The offered sale price, assessed value, and recognized value may vary based on individual circumstances and opinions.
In accounting, the generally accepted principle is to record assets at their historical cost, which is the amount paid to acquire them. This provides a reliable basis for financial reporting and ensures consistency in valuing assets. Therefore, the purchaser should record the land at its purchase price of $137,000 in their books.
To summarize, the land should be recorded at $137,000, which is the actual purchase price, reflecting the cost principle in accounting.
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There is a growing movement in the United States led by the progressive wing of the Democratic Party to have the federal minimum wage raised to $15/hr. Some people agree with the $15/hr minimum wage for the United States, while others oppose raising the minimum wage. The arguments against raising the minimum wage range from the government should not dictate salaries to it will cause low wage workers to lose their jobs since businesses cannot afford a $15/hr minimum wage.
Do you agree with a $15/hr federal minimum wage? The current federal minimum wage in the United States is $7.25/hr. Fully explain your position on this issue in 2 - 3 paragraphs.
Source: Surviving an Unlivable Wage l Full Documentary (Financial Literacy)
In my opinion, minimum wage should be increased because an increase in minimum wage would reduce poverty, increase consumer spending, and promote economic growth.
Why Should Minimum Wage be Increased?Minimum wage has not kept pace with inflation, and that the current federal minimum wage of $7.25/hr is not a living wage in most parts of the United States. A $15/hr minimum wage would provide a more realistic living wage for many low-wage workers, but there is disagreement on whether this should be achieved through federal legislation or through individual state action.
Ultimately, whether or not to raise the minimum wage is a complex issue that involves balancing the needs of workers, businesses, and the overall economy. It is important for policymakers to carefully consider the potential impacts of any minimum wage increase and to find ways to support low-wage workers without unduly burdening businesses.
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the major overall benefit of the bcg matrix is that it draws attention to the cash flow, investment characteristics and needs of an organization's various divisions. (True or False)
True, the major overall benefit of the BCG matrix is that it draws attention to the cash flow, investment characteristics, and needs of an organization's various divisions.
The Boston Consulting Group (BCG) growth-share matrix is a planning tool that uses graphical representations of a company’s products and services in an effort to help the company decide what it should keep, sell, or invest more in. The BCG growth-share matrix is a tool used internally by management to assess the current state of the value of a firm's units or product lines.
The BCG matrix helps organizations analyze and prioritize their business units based on their relative market share and growth potential, which in turn informs decisions about how to allocate resources and investment. By drawing attention to the cash flow and investment characteristics of each division, the matrix helps organizations better understand the financial performance and needs of their various business units.
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eliza buys a new motorcycle from fast bikes, inc. the most important factor in determining whether an express warranty is created is whether
Eliza purchases a brand-new motorcycle from Fab Cycles, Inc. The most crucial aspect in determining whether an express warranty is established is whether Fab Cycles' promise becomes a part of the agreement.
How Does an Express Warranty Work?A seller's agreement to repair or replace a defective product, component, or service within a predetermined time frame after it was purchased is known as an express warranty. These assurances are relied upon by customers, who frequently make purchases based on them.
A warranty is a guarantee that an item will fulfill the seller's promises. A business that provides a written express warranty is subject to federal guidelines and must adhere to the Magnuson-Moss Warranty Act, which Congress passed in 1975. In the event that a company does not adhere to its written warranty, the Act provides consumer protections.
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A sum of $46875 was lent out at simple interest and at the end of 1 year 8 months, the total amount was $50000. Find the rate of interest per year
Answer:
4%
Explanation:
Simple interest is calculated using the formula
I = p x r x t
in this case, the interest I is the total amount-principal amount
I = $50,000- $46,875
=$3,125
$3,125 = 46,875 x r x 1 year 8 months
$3,125 =46,875 x r/100 x 1.67
3125=78,281.25 x r/100
$3125 x 100 = 78,281.25 x r
$312500= 78,281.25
r=312500/78,281.25
r=3.992
r=4%
which federal reserve action can shift the aggregate demand curve to the left?
Explanation:
Contractionary Monetatary Policy
Norm worked as a sales person for his firm. When he turned fifty, the office had a party for him. His boss made a lot of jokes about Norm getting too old to keep up with the younger staff. Those comments continued past the party for several months. Norm was fired six months later. When he filed a complaint for age discrimination, the boss defended his actions by saying Norm was fired for not meeting sales quotas. Norm had missed his quota for only one month, and he provided evidence that younger employees who had missed up to three months of the quotas were not terminated. Norm is attempting to show that:
Answer: the employer's defense was a pretext.
Explanation:
Norm providing evidences that him being fired was unfair shows that Norm is attempting to show that the employer's defense was a pretext.
A pretext simply refers to a false reason which covers the true intentions or motives of an employer. In this case, the employer didn't fire Norm because he didn't meet his sales quota but fired him because of his age.
Therefore, all the defense given by the employer shows that his defense was a pretext.
Luis has a biweekly gross pay of $770 and claims 2 federal withholding allowances. Luis has all of the following deductions from his gross pay:
federal tax from the following table
A 9-column table with 7 rows is shown. Column 1 is labeled If the wages are at least with entries 720, 740, 760, 780, 800, 820, 840. Column 2 is labeled But less than with entries 740, 760, 780, 800, 820, 840, 860. Column 3 is labeled And the number of withholding allowances is 0, the amount of income tax withheld is, with entries 80, 83, 86, 89, 92, 95, 98. Column 4 is labeled And the number of withholding allowances is 1, the amount of income tax withheld is, with entries 62, 65, 68, 71, 74, 77, 80. Column 5 is labeled And the number of withholding allowances is 2, the amount of income tax withheld is, with entries 44, 47, 50, 53, 56, 59, 62. Column 6 is labeled And the number of withholding allowances is 3, the amount of income tax withheld is, with entries 26, 28, 31, 34, 37, 40, 43. Column 7 is labeled And the number of withholding allowances is 4, the amount of income tax withheld is, with entries 14, 16, 18, 20, 22, 24, 26. Column 8 is labeled And the number of withholding allowances is 5, the amount of income tax withheld is, with entries 1, 3, 5, 7, 9, 11, 13. Column 9 is labeled And the number of withholding allowances is 6, the amount of income tax withheld is, with entries 0, 0, 0, 0, 0, 0, 1.
Social Security tax that is 6.2% of his gross pay
Medicare tax that is 1.45% of his gross pay
state tax that is 19% of his federal tax
Determine how Luis’ net pay will be affected if he increases his federal withholding allowances from 2 to 3.
a.
His net pay will decrease by $19.00.
b.
His net pay will increase by $19.00.
c.
His net pay will decrease by $22.61.
d.
His net pay will increase by $22.61.
ANSWER:
His net pay will increase by $22.61.
Explanation:
Im pretty sure this is right.
Answer:
D 22.61 increase
Explanation:
how to convert 4 cs of credit?
4 C's of credit are - Capacity, Capital, Co-llateral, and Credit. The decision to extend pay-ment terms to a new customer is based aro-und the 4 Cs of credit.
The 4 Cs of credit are a common set of principles that banks and lend-ers consider when assess-ing business loan applications. The four Cs not only help the lender under-stand your business needs but can also help you when apply-ing for finance.
Stand-ards may differ from lender to lender, but there are 4 core components — the four C's — that lender will eva-luate in deter-mining whether they will make a loan: capacity, capital, co-llateral and credit.
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Choose the geographic theme represented below. Bolivia is one of two landlocked South American countries in the Andes Mountains. Poverty here is high. It has three official languages: Spanish, Quechua, and Aymara. location place human-environmental interaction movement
Answer:
Place
Explanation:
51. An independent auditor finds that the Simmer Corporation occupies office space, at no charge, in an office building owned by a shareholder. This finding indicates the existence of: A. Management fraud. B. Related party transactions. C. Window dressing. D. Weak internal control.
The independent auditor's finding that the Simmer Corporation occupies office space in a building owned by a shareholder is an indication of the existence of related party transactions.The correct option is B.
Related party transactions refer to financial transactions that occur between two parties who have a close relationship or connection with each other, such as family members, business partners, or entities with common ownership.
In this case, the Simmer Corporation and the shareholder who owns the office building have a close relationship, and as a result, the rental arrangement may not be at arm's length. The rental arrangement could be advantageous to the Simmer Corporation as it is receiving office space at no charge, and the shareholder could also benefit as it can be used as a tax deduction.
Related party transactions can raise concerns about the integrity of financial reporting and can lead to conflicts of interest.
Therefore, it is important for companies to have strong internal controls and for auditors to thoroughly investigate any related party transactions to ensure that they are disclosed appropriately in financial statements and are conducted at arm's length.
The correct option is B.
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Post-Assessment
Question 2 of 5
Why is buying a car considered "bad debt"?
It decreases in value over time
It increases your net worth as it build equity
It gives you transportation to and from your job
It is worth more than any other investment
Submit
Continue
E
The reason why buying a car considered "bad debt"is that It decreases in value over time. option A
What is bad debt?The term bad debt can be described as the amount of money that a creditor must write off as a result of a default on the part of the debtor in a case whereby the creditor has a bad debt on the books, then things turn to uncollectible and is recorded as a charge-off.
It should be noted that a case can be regarded as bad debt because the value of the asset you receive from the loan depreciates quickly however in some cases interest charges increase how the amount that is been paid for the vehicle. and in thius case cost is higher compare to what it would be if you'd purchased the car outright with cash.
Hence, option A is correct.
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Stock Y has a beta of 1.45 and an expected return of 16.3 percent. Stock Z has a beta of .90 and an expected return of 12.6 percent. What would the risk-free rate have to be for the two stocks to be correctly priced relative to each other?
Answer:
risk free rate= 6.55%
Explanation:
expected return= risk-free rate +Beta*(Market rate- risk-free rate )
Stock Y
16.3=Rf+1.45(Rm-Rf)
16.3=1.45Rm-0.45Rf
Rm=(16.3+0.45Rf)/1.45
Stock Z
12.6=Rf+0.9*(Rm-Rf)
12.6=0.9Rm+0.1Rf
12.6=0.9(16.3+0.45Rf)/1.45+0.1Rf
risk free rate=(12.6-10.11724138)/(0.279310344+0.1)
risk free rate= 6.55%
Which condition is a result of open competition in a free market system?
A. Poor customer service
B. Government regulation
C. Higher prices
D. Higher quality goods
A result of open competition in a free market system is higher quality goods (option D).
What is the result of open competition?
Competition is when there are many producers operating in a particular industry. Competition is high in purely competitive markets and low in a monopoly. This is because in a pure competition, there are many producers while there is only one producer in a monopoly.
Due to the high level of competition in an industry, prices would be more likely to be low. This is because producers would want to attract more consumers by fairly pricing their goods. Also, producers would want to offer good customer service in order to retain consumers as there are many competing producers in the market. High quality goods are also a way to attract an retain customers.
A free market system is a market system where prices are set by the forces of demand and supply. There is no government regulation in this type of market.
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How can you get your money back if you send a p2p payment to the wrong person?.
When a payment is sent to the wrong person using p2p, the money cannot be gotten back since it is equivalent to giving money to a wrong account. However, the person can lay a complaint to the customer service to take action.
What is P2P Payment?P2P payment is a system of payment where money is sent to another member of the crypto community in exchange for a coin to be sent to the individual's wallet. It is equivalent to giving someone cash.
When a user mistakenly sends money to the wrong person, the money cannot be gotten back. But if the sender has the details of the wrong receiver, an appeal can be made for the money to be reversed. However, if this is not the case, then the money would have to be forfeited.
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Which of the following factors favor the issuance of debt in the financing decision?
Please select all that apply.
Market signaling
Financial distress costs
Financial flexibility
Agency costs (management incentives)
Tax shields
The factors that favor the issuance of debt in the financing decision include financial flexibility, tax shields, and market signaling. These three factors are described below: Financial Flexibility: Companies may need financial flexibility in order to manage their day-to-day operations or make investments.
The correct option is E.
Debt financing can provide a level of financial flexibility that equity financing cannot. This is because debt financing allows companies to borrow money and pay it back over time. As a result, companies can use their cash to invest in new projects or pay dividends to shareholders. Tax Shields: Debt financing can provide companies with tax shields. This is because interest payments on debt are tax-deductible.
As a result, companies can reduce their tax liability by taking on debt. This can help them to increase their profitability and return on investment. Market Signaling: Companies may issue debt as a way of signaling their strength and creditworthiness to the market. This can help them to attract investors and lenders. For example, if a company issues debt with a high credit rating, it may be viewed as a safer investment than a company that issues debt with a low credit rating. This can help to attract investors and lenders, and may result in a lower cost of capital.
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Sasha has the new responsibility of initiating strategies that would help safeguarding her company against recession. She conducts a meeting with all the employees in which she explains how she would go about implementing her plans. She also motivates and encourages employees to follow through with her plan. Sasha is a ________.
Answer:
Strategic leader
Explanation:
Leadership can be defined as a process which typically involves motivating, encouraging and inspiring employees working under an individual to be innovative and create positive changes that will foster growth and enhance the success of a business firm or company in the future.
A leader can be defined as an individual who is saddled with the responsibility of controlling, managing and maintaining a group of people under him or her. Some types of power expressed by leaders are referent power, legitimate power, coercive power, etc.
Generally, leaders use their powers to get other people to follow them. Some forms of power result from a formalized position in the organization while others are derived from personal characteristics or knowledge.
A strategic leader refers to an individual that utilizes strategy in the management of people without the use of threats and force to make them follow.
In this scenario, Sasha is a strategic leader because she motivates and encourages the employees to follow through with her plan.
Which of the following methods would be most appropriate for an emotional appeal?
A.Telling a story about people who resemble the target audience
B.Creating a contrast with the surrounding environment
C.Asking the audience to act
D.Providing information about the product
Answer: telling a story about people who resemble the target audience
Explanation: just took the test
Telling a story about people who resemble the target audience would be most appropriate for an emotional appeal. Thus, option 'A' is the correct option.
What is Emotional Appeal?A kind of persuasion known as an emotional appeal uses sensory, descriptive language and images to stimulate an audience's emotions and persuade them of a point of view. Social psychology is used in the appeal to emotion strategy. Only when the evoked emotions are unrelated to determining the veracity of the conclusion and help to divert from a logical analysis of pertinent premises or facts is it erroneous.
For instance, if a pupil says "My scholarship will be forfeited if I receive a poor mark on this essay. It is not copied "The initial statement's emotional impact is unrelated to determining whether the text was duplicated. In order to persuade the audience that the claims being made by the fallacious argument are true or untrue, appeals to emotion aim to evoke sentiments like fear, pity, or delight in the person receiving the information.
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a tax on buyers causes which of the following? (i) a leftward shift of the demand curve (ii) a decrease in quantity sold (iii) an increase in the price buyers pay (ii) and (iii) only (i) (i), (ii), and (iii) (i) and (iii)
A Tax on buyers causes all of the following listed in the option. So the correct option is a. (i), (ii), and (iii). A tax on buyers causes a leftward shift in the demand curve, a decrease in the quantity of goods sold, and an increase in the price buyers pay.
Taxation refers to a certain sum of money collected by the government from either the sellers or buyers on purchasing or producing goods and services. Taxation decreases the incentives of the entities. A tax on buyers signifies that a sum of money is collected from the consumers while purchasing certain goods through increased price.
In addition, a tax reduces the quantity traded, thereby reducing some of the gains from trade. A tax increases the price a buyer pays by less than the tax.
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letter of editor of a newspaper expressing The View against the Intensive use of loud speaker please help ASAP before 10:45
If a firm is earning an accounting profit, it is definitely earning an economic profit that is at least as large as the accounting profit too True or False
True, While a firm earning an accounting profit is definitely earning an economic profit, it is possible for the economic profit to be larger than the accounting profit.
The accounting profit:Accounting profit is the difference between the total revenue and the total costs of a company. The total costs include both the explicit costs and the implicit costs. The explicit costs are the direct costs that are incurred in the production of the good or service. The implicit costs are the opportunity costs that are incurred when the company uses its resources for something other than production.
The accounting profit is important because it provides a measure of how much revenue a company has generated from its activities. It is also a useful tool for managers to use when making decisions about how to allocate resources.
One limitation of accounting profit is that it does not take into account the opportunity cost of the resources that a company uses. For example, if a company uses its factory to produce widgets, the opportunity cost of using the factory is the revenue that the company could have earned if it had used the factory to produce something else. This opportunity cost is not included in the accounting profit.
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Is there any way for a monopoly to operate more efficiently than a competitive market? why or how?.
The equilibrium point in a competitive market exists at the point of optimal market efficiency.
What is competitive market?A competitive market exists a term in economics that guides to a marketplace where there exist a large number of buyers and sellers and no single buyer or seller can influence the market. Competitive markets have no obstacles to entry, lots of buyers and sellers, and homogeneous products.
In economics, especially general equilibrium theory, A perfect market also understood as an atomistic market, is determined by several idealizing requirements, collectively anointed perfect competition or atomistic competition.
No, the monopoly can never be additional efficient than the perfectly competitive market because the competitive market exists at the point of optimal market efficiency and the monopoly will deliver at the point where the MR and the MC stand equal. here the market has the excess capability and a dead weight loss.
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which principle defines how many times something repeats.
The principle that defines how many times something repeats itself is called the repetition compulsion.
This psychological principle was studied by psychoanalyst Freud as an essential component for mental analysis, as the discovery of patterns of repetitive behavior is aimed at the unconscious and instinctive search for:
pleasure and to avoid contempt.Therefore, repetition compulsion is related to repetition of behaviors in the form of dreams and neuroses in the form of the individual unconsciously seeking to assume a slightly more dominant role over an event that may have generated trauma.
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you agree to repay $1,200 in 2 weeks for a $1,000 payday loan. what is your ear assuming that there are 52 weeks in a year?
The EAR assuming that there are 52 weeks in a year is $11,347.55. The Correct answer is $11,347.55.
What is EAR?EAR is the Effective annual rate or effective rate is the percentage of interest on a loan or financial product if compound interest accumulates over a year during which no costs are made.
The difference between APR and EAR is that APR is based on simple interest, while EAR takes compound interest into a relationship. APR is most useful for measuring mortgage and auto loans, while EAR (or APY) is most operative for evaluating frequently compounding loans such as credit cards.
Apply the EAR Formula: EAR = (1+ i/n)n – 1.
Where,
i = Stated interest rate.
n = Compounding periods.
= (1200/1000)^52/2-1
= 11,347.55
Therefore, The Correct answer is $11,347.55.
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in the traditional approach to managing contractual relationships, blank is limited due to fear of reprisal and lack of continuous improvement opportunity.
Traditionally, managing contractual relationships has been done through structured communication.
The definition of structured communication
In order to increase understanding and interpersonal interactions, structured communication is a strategy you can use. In business settings, using structures in your communication is crucial to ensuring that coworkers are aware of procedures and are working efficiently to support organizational goals. The type of message or interaction you're having with others will determine whether you should use structured communicating. For instance, various structures can be used to direct clarity and focus when conducting team meetings and communicating information. Communication with structure has a number of benefits. Frameworks offer a way to clearly communicate information in written communications.
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What is characteristic of an organization in which salespeople do most or all of their own marketing?
independent
small size
nonprofit
private
Answer:
private
Explanation:
people are doing private marketing to earn money for themselves
i need help ASAP!!!! Generally, parties of 8 or more require many restaurants to include gratuity of 18% on the check before presenting to the guest. For a party of 12 and a total check in the amount of $191.40, what is the gratuity amount added to the check for this large party?a) $18.00 b)$34.45 c)$43.54 d)$191.40
Answer:
b)$34.45
Explanation:
Gratuity is similar to a service charge.
If the bill is $191.40, and gratitude of 18 percent will be added.
The actual gratitude amount that will be added will be equal to
18% of the $191.40 bill.
=18/100 x $191.40
=0.18 x 191.40
= $34.45
Check through that apply
How did foreign powers convince the United States of the need for a stronger federal government?
-The Spanish refused to allow the Americans access to the Mississippi River.
-North African pirates confiscated American goods and kidnapped American sailors.
-Both the British and the French closed off ports to American shipping.
-The French threatened to invade from Canada.
-A Mexican army invaded Texas.
-The Japanese were seizing land along the Pacific coast.
The answer is Both the British and the French closed off ports to American shipping.
What does a port do primarily?Ports function as significant transportation nodes that assist the transit of products. the transfer of cargo (including raw materials, components, and completed consumer goods) across all means of transportation, including rail, truck, air, and sea, to enterprises in nearby towns and on the global market.
What are ports known as?A port is a location near the mouth of a river, lake, or ocean where ships can load and unload their cargo. At a port, passengers can board or depart ships. It is sometimes referred to as a port or a harbor.
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Which of the following can result from inflation in the United States?
A. Currency exchange rates remain the same.
b. Investors buy products in other countries.
c. The price of goods in the United States falls.
d. The value of the U.S. dollar increases.
Answer:
Investors buy products in other countries (B)
Explanation:
Out of all the answers
(A) Currency exchange rates remain the same. No
(B) Investors buy products in other countries. YES
(C) The price of goods in the United States falls. No
(D) The value of the U.S. dollar increases. No
The reason why it is not A, B, or C. When inflation happens the currency exchange rates are lower cause our inflation The Price Of goods doesn't fall it actually rises, and the value of the dollar actually decreases due to inflation. It just makes sense for investors to buy from other countries where they can pay less for what they get here in the United States.
The result from inflation in the United States can investors buy products in other countries. The correct option is (b).
What do you mean by the inflation in USA?A loss of purchasing power over time, or inflation, means that your dollar will not buy as much as it did today. The annual change in prices for a basket of goods and services is commonly used to measure inflation. There are two primary inflation indicators in the US.
According to John Taylor, a Stanford economist, monetary policy is a significant factor in the rise in inflation.
According to Stanford economist John Taylor, inflation increases when the Federal Reserve sets an interest rate that is too low or when the growth of the money supply is too rapid, as it is at the moment.
Uneven price increases during an inflationary period certainly lower some consumers' purchasing power.
Therefore, the result from inflation in the United States can investors buy products in other countries.
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A large company in the communication and publishing industry has quantified the relationship between the price of one of its products and the demand for this product as Price = 150- 0.01 x Demand for an annual printing of this particular product. The fixed costs per year (i.E., per printing) =$50,000 and the variable cost per unit =$40. What is the maximum profit that can be achieved if the maximum expected demand is 6,000 units per year? What is the unit price at this oint of optimal demand?
Answer:
a. The maximum profit that can be achieved is $300,000.
b. The unit price at this point of optimal demand is $90.
Explanation:
From the question, we can obtain the following:
x = Maximum expected demand = 6,000 units
Price = 150 - 0.01 x = 150 - (0.01 * 6,000) = 150 - 60 = $90
Fixed cost per year = $50,000
Variable cost per unit = $40
Total variable cost = Variable cost per unit * Maximum expected demand = $40 * 6,000 = $240,000
Total cost = Fixed cost + Total variable cost = $50,000 + $240,000 = $290,000
Revenue = Price * Maximum expected demand = $90 * 6,000 = $540,000
Therefore, we have:
a. What is the maximum profit that can be achieved if the maximum expected demand is 6,000 units per year?
Profit = Revenue - Total cost = $540,000 - $240,000 = $300,000
Therefore, the maximum profit that can be achieved is $300,000.
b. What is the unit price at this point of optimal demand?
As already stated above, the following are given in the question:
x = Maximum expected demand = 6,000
Price = 150 - 0.01 x ........................... (1)
Substitute for x in equation (1), we have:
Price = 150 - (0.01 * 6,000) = 150 - 60 = $90
Therefore, the unit price at this point of optimal demand is $90.