Two firms, A and B, both produce widgets. The price of widgets is $1 each. Firm A has total fixed costs of $500,000 and variable costs of 50¢ per widget. Firm B has total fixed costs of $240,000 and variable costs of 75¢ per widget. The corporate tax rate is 40%. If the economy is strong, each firm will sell 1,200,000 widgets. If the economy enters a recession, each firm will sell 1,100,000 widgets. If the economy enters a recession, the after-tax profit of Firm A will be
A. $0.
B. $6,000.
C. -$30,000.
D. $60,000.
E. None of the options are correct.
C. -$30,000.
$1,100,000 ? 500,000 FC ? 0.5($1,100,000) VC = ($50,000)(1 ? .4) = $30,000.
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Janos Corporation, which has only one product, has provided the following data concerning its most recent month of operations: Selling price$111 Units in beginning inventory 300Units produced 2,000Units sold 2,200Units in ending inventory 100 Variable costs per unit: Direct materials$29Direct labor$30Variable manufacturing overhead$4Variable selling and administrative expense$9Fixed costs: Fixed manufacturing overhead$34,000Fixed selling and administrative expense$39,600The company produces the same number of units every month, although the sales in units vary from month to month. The company's variable costs per unit and total fixed costs have been constant from month to month.What is the unit product cost for the month under variable costing?
A. $80 per unit B. $89 per unit C. $72 per unit D. $63 per unit
How should these stock rights be treated in earnings per share calculations for the year ending December 31 . 2012?
a. The stock options are antidilutive and should not be included either in basic and diluted earnings per share. b. The stock options are dilutive and should be included both in basic and diluted earnings per share. c. The stock options are dilutive and should be included both in basic and diluted earnings per share in the amount of 333 shares. d. The stock options are dilutive and should be included only in diluted earnings per share in the amount of 333 shares.
Define simulation
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