Please refer to the following incomplete data describing costs and revenues for a monopolistic firm. Assuming that this firm wants to maximize profits, which of the following most accurately describes the price should it charge for this good? Output Price Total Revenue Marginal Revenue Total Cost Marginal Cost Average Total Cost 0 $100 $0 na $50 na na 1 $90 $90 $90 $65 $15 ? 2 $80 $160 ? $75 ? $38 3 $70 $210 ? $95 $20 $32 4 $60 $240 $30 $125 ? $31 5 $50 $250 $10 $175 ? ? 6 $40 $240 -$10 $265 $90 $44 7 $30 $210 ? $415 $150 $59 $30 $50 Less than $30 more than $50

On February 1, 2021, Arrow Construction Company entered into a three-year construction contract to build a bridge for a price of $8,480,000. During 2021, costs of $2,160,000 were incurred with estimated costs of $4,160,000 yet to be incurred. Billings of $2,660,000 were sent, and cash collected was $2,410,000.

In 2022, costs incurred were $2,660,000 with remaining costs estimated to be $3,840,000. 2022 billings were $2,910,000 and $2,635,000 cash was collected. The project was completed in 2023 after additional costs of $3,960,000 were incurred. The company’s fiscal year-end is December 31. Arrow recognizes revenue over time according to percentage of completion.

Required:
1. Compute the amount of revenue and gross profit or loss to be recognized in 2021, 2022, and 2023 using the percentage of completion method.

Presented below is information related to Bonita Corp. for the year 2017.

1. Party supply store A rents tables for $10 per day and chairs for $1.50 per day. Party supply store B rents tables for $9 per day and chairs for $1.25 per day, plus a $36 delivery charge. After how many days is it more expensive to rent 3 tables and 24 chairs from store A?

2. The demand function for an electronics company's line of gaming laptops is p = f(q) = 5,000 - 10q, where p is the price (in dollars) per laptop when q laptops are demanded (per week) by consumers. Find (a) the level of production that will maximize the electronics company's total weekly revenue, (b) the maximum revenue at this level of production, and (c) the price per laptop at this level of production.

QUESTION 2                                                                                                    

A hospital consortium contracted with a private company to collect fees and maintain health facilities that adjoin their property. Users of the health facility can pay cash of R10 for a daily visit or they can purchase a pass. The pass has a magnetic strip that is swiped through the entrance device each time an individual enters the facility. This subtracts daily fee from the pass balance for each day used. The passes are issued for a fee of R365, which are good for 365 days. Refunds are not issued on the pass. Last year R18,650 was collected for daily visits, R438,000 of annual passes were issued, and R206,225 of pass usage was registered on the scanning equipment. How much should the company recognize as revenue for the year? Explain how the revenue recognition rule should be applied in this case.

Income statement information for Blue Spruce Tire Repair Corporation for the year 2017 follows: General and administrative expenses: Freight-in $14,000 Salaries and wages expense $37,500 Purchase discounts 11,000 Depreciation expense—building 29,600 Dividend revenue 22,000 Office supplies expense 9,600 Inventory (beginning) 114,000 Inventory (ending) 139,000 Sales returns and allowances 14,000 Loss—other (due to flood damage) 51,000 Service expenses: Gain on the sale of equipment 6,000 Salaries and wages 68,000 Purchases 570,000 Depreciation expense—garage equipment 16,400 Sales revenue 900,000 Garage supplies expense 8,200 Interest expense 8,200 The effective tax rate on all income is 32%, and Blue Spruce applies ASPE. (a) Prepare a multiple-step income statement for 2017, showing expenses by function.

ndiana Co. began a construction project in 2021 with a contract price of $150 million to be received when the project is completed in 2023. During 2021, Indiana incurred $36 million of costs and estimates an additional $84 million of costs to complete the project. Indiana recognizes revenue over time and for this project recognizes revenue over time according to the percentage of the project that has been completed.

In 2022, Indiana incurred additional costs of $58.5 million and estimated an additional $40.5 million in costs to complete the project. Indiana:

A. Recognized $15 million gross profit on the project in 2022.

B. Recognized $13.5 million gross profit on the project in 2022.

C. Recognized $6 million gross profit on the project in 2022.

D. Recognized $1.5 million gross profit on the project in 2022.

Indiana Co. began a construction project in 2021 with a contract price of $163 million to be received when the project is completed in 2023. During 2021, Indiana incurred $37 million of costs and estimates an additional $90 million of costs to complete the project. Indiana recognizes revenue over time and for this project recognizes revenue over time according to the percentage of the project that has been completed.

Suppose that, in 2022, Indiana incurred additional costs of $64 million and estimated an additional $51 million in costs to complete the project. Indiana (Do not round your percentage calculated):

A. Recognized $3.00 million loss on the project in 2022.

B. Recognized $3.18 million gross profit on the project in 2022.

C. Recognized $6.18 million gross profit on the project in 2022.

D. Recognized $3.18 million loss on the project in 2022.

Suppose that an oil well is expected to produce 12, 00,000 barrels of oil during its first production year However its subsequent production (yield) is expected to decrease by 9% over the previous year's production The oil well has a proven reserve of 10, 50 barrels. (a) Suppose that the price of oil is expected to be $120 per barrel for the next six years. What would be the present worth of the anticipated revenue trim at an interest rate of 10% compounded annually over the next six years? (b) Suppose that the price of oil is expected to start at $120 per barrel during the first year, but to increase at the rate of 3% over the previous year's price. What would be the present worth of the anticipated revenue stream at an interest rate of 10% compounded annually over the next seven years?

Describe how you would go about analyzing a make-or-buy decision when:

1. Your in-house production capability is not being used to full capacity.

2. You do not have the in-house production capability but could acquire it.

3. You have the in-house capability, but demand for its use exceeds full capacity.

Suppose a company has a contribution margin of 40 percent and total fixed costs of $3 million per year:

1. What is its break-even point in revenue?

2. If its fixed costs increase by 10 percent, and its contribution margin remains unchanged, by what percentage of revenue does its breakeven point increase?

3. By how much would its contribution margin increase if it could raise prices by 3 percent with no changes in variable or fixed costs?