Answer:
debt-equity ratio results in the lowest possible weighted average cost of capital.
Explanation:
The debt equity ratio measures how well a business's equity can account for its debt.
Weighted average cost of capital is referred to as a business's cost of capital and is the rate a company is expected to pay to its shareholders.
When the debt equity ratio results in the lowest weighted average cost of capital, it indicates that the cost of finding for the company is low. This is the optimal and least expensive capital structure.
Answer:
Contribution margin= $15
Explanation:
Giving the following information:
Sales May in units:
Budget:
Tulips= 4,950
Geraniums= 3,300
Actual:
Tulips= 4,420
Geraniums= 4,080
Contribution margin:
Budget:
Tulips= $11
Geraniums= $21
Actual:
Tulips= $12
Geraniums= $19
We need to calculate the budgeted contribution margin per composite unit.
First, we need to calculate the percentage of sales for each plant.
Total units= 8250 units
Tulips= 4950/8250= 0.6
Geranius= 3300/8250= 0.4
Contribution margin= (0.6*11)+(0.4*21)= $15
Answer:
$183,000
Explanation:
The computation of the cost of goods sold using the FIFO method is shown below:
= Number of units purchased × per unit + additional units purchased × per unit
= 15,000 units × $10 + 3,000 units × $11
= $150,000 + $33,000
= $183,000
Since there are 18,000 units are sold
out of which 15,000 are at $10 and the remaining 3,000 units are at $11 and the same is to be considered
Answer:
d) economies of scale result from decline in the average cost of production per unit as volume increases whereas economies of scope result from decline in the average cost of production due to the sharing resources across products and services.
