Response: $1,110.
Explanation:
Data Provided: Revenue from concession stand sales on game day = $5,550
That is to say, Gross income = $5,550
Event profit = $3,330
Thus, Net income = $3,330
Using the Net income formula:
Gross income - expenses = Net income
Therefore, Expenses = Gross income - Net income
Thus, Expenses = $5,550 - $3,330
Thus, Expenses total $1,110.
After the stock dividend, earnings per share stand at $3.636. To elaborate, there are 200,000 shares currently available, with after-tax profits recorded at $800,000. The current price of the shares is set at $48, while the stock dividend is at 10%. After the dividend, the updated number of shares is calculated as 200,000*(1+10%) = 220,000. Consequently, the earnings per share after the dividend is $800,000/220,000, resulting in $3.636.
Answer:
PED = 0.67 indicates inelastic demand.
This suggests that reducing the book's price is not advisable.
Explanation:
To calculate price elasticity of demand, we utilize the midpoint formula: {(Q2 - Q1) / [(Q2 + Q1) / 2]} / {(P2 - P1) / [(P2 + P1) / 2]}
PED is computed as follows: {(50 - 40) / [(50 + 40) / 2]} / {(25 - 35) / [(25 + 35) / 2]} = [10 / (90 / 2)] / [-10 / (60 / 2)] = (10 / 45) / (-10 / 30) = 0.222 / -0.333 = 0.67
The value of PED = 0.67 implies that the demand does not respond greatly to price changes.
If you proceed to lower the book's price, the rise in the number of copies sold will not be enough to offset the loss from the reduced price, resulting in financial loss.
Response:
Minimum selling price= $28
Reasoning:
Based on the information provided:
Direct materials $8
Direct labor $9
Variable manufacturing costs= $7
Landor has received a special order for 25,000 fans destined for an overseas buyer.
The only incurred selling cost for this order will be $4 per fan for shipping.
Given that this is a special request and there is available capacity, fixed costs will not be considered in this analysis.
The minimum price needed equals the total variable cost per unit. It is not a sustainable price long-term.
Variable cost per unit= 8 + 9 + 7 + 4= $28
[[TAG_55]]Minimum selling price= $28[[TAG_56]]
