Answer:
The dividend expense will total $20,000
Explanation:
We know the total shares issued = 12,000
And Treasury stock = 2,000 shares
A regular dividend of $2 per share is declared
Now, we must calculate the total dividend
Outstanding shares = Issued shares - Treasury stock = 12,000 - 2,000 = 10,000 shares
Thus, the dividend expense is calculated as $2 × 10,000 = $20,000
Therefore, the total dividend expense equates to $20,000
Answer:
a) 120 skiers daily
b) 6.25% rise in revenue
Explanation:
a) Assuming each skier stays for an average of 10 days, the daily turnover corresponds to 1/10 of the total skiers, which results in 1200/10 = 120 skiers daily.
__
b) For a duration of n days, the average expenditure for a skier is...
50 +(n-1)30 = 20 +30n
and the average daily spending calculates to...
(20 +30n)/n = (20/n) +30
Thus, for a 10-day visit, the average skiier's restaurant spending is...
20/10 +30 = 32.... each day
Similarly, for a stay of 5 days, the average skier's expense becomes...
20/5 +30 = 34.... each day
The anticipated change in restaurant revenue is...
(34 -32)/32 × 100% = 2/32 × 100% = 6.25%
Restaurant revenues are projected to increase by 6.25% from the previous year.
Response:
a. Based on the company’s accounting records, the net operating income for product D14E is: (Net losses should be indicated with a negative sign.)
b. Evaluating the financial impact of discontinuing product D14E: It would lead to a financial disadvantage of -$68,000, so the product should remain in production as its losses would otherwise rise
- The financial summary is:
total sales $670,000
- variable expenses $295,000
- fixed manufacturing expenses $246,000
- fixed selling and administrative expenses $194,000
net loss = $65,000
If product D14E were to be cut, $196,000 + $111,000 = $307,000 of fixed expenses could be avoided, but $133,000 would still remain unavoidable. Discontinuing the product would increase losses by $133,000 - $65,000 = $68,000
