The management of Plotnik Corporation is investigating purchasing equipment that would increase sales revenues by $269,000 per year and cash operating expenses by $156,000 per year. The equipment would cost $294,000 and have a 6 year life with no salvage value. The simple rate of return on the investment is closest to (Ignore income taxes.):
A. 21.8%
B. 38.4%
C. 16.7%
D. 23.8%
Answer: A
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The party to whom a duty is owed is the ________
A) delegator B) delegatee C) obligor D) obligee
Which sentence is expressed correctly?
A) The sales meeting was postponed to another day (Wednesday)? B) The sales meeting was postponed to another day (Wednesday?).
A third party beneficiary's status occurs
a. after an assignment and delegation. b. when the third party is informed of the contract. c. when the third party beneficiary agrees to the contract terms. d. when the contract is created.
Sardi Inc. is considering whether to continue to make a component or to buy it from an outside supplier. The company uses 17,000 of the components each year. The unit product cost of the component according to the company's cost accounting system is given as follows: Direct materials$8.20 Direct labor 8.30 Variable manufacturing overhead 1.20 Fixed manufacturing overhead 4.30 Unit product cost$22.00 Assume that direct labor is a variable cost. Of the fixed manufacturing overhead, 70% is avoidable if the component were bought from the outside supplier. In addition, making the component uses 2 minutes on the machine that is the company's current constraint. If the component were bought, time would be freed up for use on another product that requires 4 minutes on this machine and
that has a contribution margin of $7.00 per unit.When deciding whether to make or buy the component, what cost of making the component should be compared to the price of buying the component? A. $25.50 per unit B. $22.00 per unit C. $24.21 per unit D. $20.71 per unit