1) How does elasticity and its relationship with total revenue apply?

2) What about the firms process for maximizing profits. How can that affect things?

3) What is the difference between profits and revenues?

Questions from chapters 4&5:

Brickley, J. A., Smith, C. W., & Zimmerman, J. L. (2016). Managerial economics and organizational architecture. Boston: McGraw-Hill Irwin.

What is a contra account? How do revenue contra accounts, specifically, differ from expense accounts?

IMT Co. reported the following selected information for 2010:

Sales revenue ..........................................................................................    $865,000

Cost of goods sold..................................................................................      360,000

Depreciation expense .............................................................................        43,000

Salaries & wages expense ……………………………………………...     178,000

Rent Expense …………………………………………………………..       95,000

                                                                                          Beginning of Year        End of Year

Accounts receivable .....................................                $ 15,000                 $ 35,000

Prepaid rent ...................................................                   21,000                    15,000

Salaries & wages payable .............................                   33,000                    18,000

Required:Use the above information to calculate:

The cash collected from customers

ii)The cash paid for depreciation

iii)The cash paid to employees

iv)The cash paid for rent

Break Even Point Case, Sports Bar Assignment:

Key Formulae:

A) PROFIT = REVENUE PER UNIT * QUANTITY – [TOTAL FIXED COST +

(VARIABLE COST PER UNIT * QUANTITY)]

B) BREAKEVEN POINT = TOTAL FIXED COST/(REVENUE PER UNIT –

VARIABLE COST PER UNIT)

Arthur and 2 college friends decide to open a sports bar/restaurant in their home town.

After some research they determined that the best way to start is to obtain a franchise from

a Chicago based company. The company would acquire the land, build and outfit the

facility. AJ and friends would pay a monthly comprehensive fee of $10,000. This fee would

include the franchise royalty payment, the mortgage payment for the actual facility (that

would be paid off in full in 20 years) and all utility fees.

AJ and his 2 friends want to pay themselves $4,000 per month each. The staff would cost

$2,000 per week ($200 each for 10 employees). The estimated variable cost per customer is

$9.00 each. The forecasted revenue is $24.00 per customer.

What is the breakeven point in number of customers per month for the sports

bar/restaurant?

If they served 2,500 customers per month, what would their profit be?

For the following problems, use this information from Thompson Corporation’s annual reports:

These data are included in the file Thompson Data Spring 2019

1. Compute a simple index for the revenue each year of Thompson. Use 2003 as the base period. (4 pts)
2. Compute a simple index for the revenue each year of Thompson using the period 2003–05 as the base. (4 pts)
3. What can you conclude about the change in revenue over this time period? (2 pts.)
4. Compute a simple index for the number of employees each year for Thompson. Use 2003 as the base period. (4 pts)
5. Compute a simple index for the number of employees each year for Thompson using the period 2003–05 as the base. (4 pts)
6. What can you conclude about the change in the number of employees over the period? (2 pts)

How can the Tesla Cybertruck become one of Tesla’s best selling vehicles by revenue? (Manufacturing efficiencies, scale, etc.)

Income Statement Covid Company for the year ended December 31, 2019 shows sales revenue $6,000,000 and COGS $3,800,000 . Accounts receivable increased $250,000 during the year, and inventory decreased $300,000. Accounts payable to suppliers of merchandise decreased $450,000 during the year. Accrued expenses payable decreased $90,000 during the year. Operating expenses include depreciation expense of $1,600,000. Depreciation expense was $100,000. Prepare Statement of Cash Flow Operating Activities Section for Covid Company.

Please Dont reply with Generic answer.

Does the growth of e-commerce affect sales tax revenue for state and local governments? Explain whether Internet transactions should be subject to sales tax or not. 3 source is appreciated.
Thank you.

1. Using the graph of market demand curve, explain why marginal revenue is less than price.

alculating Gross Profit and Inventory Turnover
The following table presents sales revenue, cost of goods sold, and inventory amounts for three computer/electronics companies, Dell Inc., Hewlett-Packard Company, and Apple Inc.

Required:
a. Compute the gross profit margin (GPM) for each of these companies for all three fiscal years.
(Round your answers to one decimal place.)

b. Compute the inventory turnover ratio and the average inventory days outstanding for each company for the last two fiscal years. (All three firms use FIFO inventory costing.)
(Round your answers to one decimal place.)