QUESTION 9 You plan on starting a lawn mowing business by investing $700 of your own money and purchase $500 of equipment. You plan to work 260 hours per month and charge your customers $22 per hour. Your anticipated costs include: Depreciation Advertising Gas Assistant's Wages Miscellaneous Expenses $25.00 per month $26.00 per month $1.20 per hour $8.00 per hour $20.00 per month Calculate your Variable cost per hour on the budgeted contribution margin income statement. 1

QUESTION 9 You plan on starting a lawn mowing business by investing $700 of your own money and purchase $500 of equipment. You plan to work 260 hours per month and charge your customers $22 per hour. Your anticipated costs include: Depreciation Advertising Gas Assistant's Wages Miscellaneous Expenses $25.00 per month $26.00 per month $1.20 per hour $8.00 per hour $20.00 per month Calculate your Variable cost per hour on the budgeted contribution margin income statement. 1

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter3: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 8EB: Shonda & Shonda is a company that does land surveys and engineering consulting. They have an...

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QUESTION 9 You plan on starting a lawn mowing business by investing $700 of your own money and purchase $500 of equipment. You plan to work 260 hours per month and charge your customers $22 per hour. Your anticipated costs include: Depreciation Advertising Gas Assistant's Wages Miscellaneous Expenses $25.00 per month $26.00 per month $1.20 per hour $8.00 per hour $20.00 per month Calculate your Variable cost per hour on the budgeted contribution margin income statement.
Shonda & Shonda is a company that does land surveys and engineering consulting. They have an opportunity to purchase new computer equipment that will allow them to render their drawings and surveys much more quickly. The new equipment will cost them an additional $1.200 per month, but they will be able to increase their sales by 10% per year. Their current annual cost and break-even figures are as follows: A. What will be the impact on the break-even point if Shonda & Shonda purchases the new computer? B. What will be the impact on net operating income if Shonda & Shonda purchases the new computer? C. What would be your recommendation to Shonda & Shonda regarding this purchase?
QUESTION 5 You currently work as a machinist for a factory. Your salary is $28,000 per year. You are thinking about quitting your job and going back to college. It will take you two years to obtain your college degree. Tuition and other costs of the education will total $24,000. You also intend to keep your car by making $250 per month payments out of your savings. How much is the opportunity cost of going to college. $28,000 $56,000 $52,000 $62.000 QUESTION 6 The scattergraph is a useful tool for: Analyzing abrupt changes in cost behavior Determining actual variable costs Determining the break-even point Working outside the relevant range
Principle of Finance Workshop 1 Questions NPV Calculations 1. You have the opportunity to invest in a machine that costs $340,000. The machine generates revenues of $100,000 at the end of each year and requires maintenance costs of $10,000 at the beginning of each year. The machine incurs a maintenance cost today because of start-up expenses. If the economic life of the machine is five years and the relevant discount rate is 10%, should you buy the machine? What if the relevant discount rate is 9%?
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Question 19 After spending $10,200 on client-development, you have just been offered a big production contract by a new client. The contract will add $204,000 to your revenues for each of the next five years and it will cost you $99,000 per year to make the additional product. You will have to use some existing equipment and buy new equipment as well. The existing equipment is fully depreciated, but could be sold for $54,000 now. If you use it in the project, it will be worthless at the end of the project. You will buy new equipment valued at $25,000 and use the 5-year MACRS schedule to depreciate it. It will be worthless at the end of the project. Your current production manager earns $80,000 per year. Since she is busy with ongoing projects, you are planning to hire an assistant at $45,000 per year to help with the expansion. You will have to immediately increase your inventory from $20,000 to $30,000. It will return to $20,000 at the end of the project. Your company's tax…
Exercise #5: You are leasing a car worth $32,000 for 36 months. You put down $1200 now and agree to monthly payments. The residual value is $17,000. The financing rate is 6% (monthly compounded). How much are your monthly payments going to be? Draw the time line, work the calculator entries. 0 1 2 What is the EAR in this problem? EAR = ... [10]...............% $ ***** -1 36 [9]
Question 15 of 16 Elise and her friend Eloi developed an online car repair training course and sell it for $69 per course. The contribution margin per course is $26 and to break even they need to have a total revenue of $12,420 per annum. a. What is the break-even volume? Round up to the next whole number b. What is the fixed costs per annum? Round to the nearest cent c. What is the total revenue if they sell 3,020 courses this year?
PI A manager at Shannon's Custom Cabinets is interested in purchasing a computer, software, and peripheral equipment costing $240,000 that would allow company salespeople to demonstrate to custor finished carpet installation would appear. Using this cost, the manager has determined that the investments net present value is $126.000, Compute the investment's profitability index Note: Round your answer to one decimal point de round 4.555 to 4.63 0
QUESTION 1 Refer to Scenario 9.2 below to answer the question(s) that follow. SCENARIO 9.2: Tom borrowed $40,000 from his parents to open a donut stand. He agrees to pay his parents a 5% yearly return on the money they lent him. His other yearly fixed costs equal $10,000. His variable costs equal $25,000. He sold 40,000 dozen donuts during the year at a price of $2.00 per dozen. Refer to Scenario 9.2. Tom's total fixed costs equal O $1,000. O $10,000. $12,000. O $21,000.
Student Question 不 Your factory has been offered a contract to produce a part for a new printer. The contract would last for 3 years and your cash flows from the contract would be $4.82 million per year. Your upfront setup costs to be ready to produce the part would be $7.97 million. Your discount rate for this contract is 7.6%. a. What does the NPV rule say you should do? b. If you take the contract, what will be the change in the value of your firm? Your factory has been offered a contract to produce a part for a new printer. The contract would last for 3 years and your cash flows from the contract would be $4.82 million per year. Your upfront setup costs to be ready to produce the part would be $7.97 million. Your discount rate for this contract is 7.6% a. What does the NPV rule say you should do? b. If you take the contract, what will be the change in the value of your firm? Your Submission Rating Sub-Subject Principles Of Finance Step-by-step Step 1 of 2 Topic Risk And Rates Of…
s Book Het Print ferences If you insulate your office for $13,000, you will save $1,300 a year in heating expenses. These savings will last forever. a. and b. What is the NPV of the investment when the cost of capital is 8%? What if it is 10%? Cost of Capital a. 8% b. 10% 1320 NPV