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El cumpleaños de mi abuelo. Lee el párrafo y escoge la palabra adecuada. El abuelo de Carmen va a [1] sus 70 años el 18 de diciembre en Saint Lous. Carmen va a invitar a sus tíos, primos y amigos de su abuelo. El día de la fiesta, Carmen y su familia van a pasar todo el día [2]. En la fiesta van a tener un rico [3] de zanahoria con helado, camarones al ajillo, las ensaladas, los postres y el  [4] tinto/rojo de Argentina que a su abuelo le gusta. El abuelo de Carmen va a  [5] con su familia.

Cranberry has received a special order for 100 units of its product at a special price of $2,100. The product normally sells for $2,600 and has the following manufacturing costs:    Per unit Direct materials   $ 730 Direct labor     430 Variable manufacturing overhead     530 Fixed manufacturing overhead     630 Unit cost   $ 2,320   Assume that Cranberry has sufficient capacity to fill the order without harming normal production and sales. If Cranberry accepts the order, what effect will the order have on the company’s short-term profit?

Which of the following capital budgeting methods focuses on net income rather than cash flows?

NF Toy Company is unsure of whether to sell its product assembled or unassembled. The unit cost of the unassembled product is $24 and NF Toy would sell it for $52. The cost to assemble the product is estimated at $17 per unit and the company believes the market would support a price of $68 on the assembled unit. What decision should NF Toy make?

Wright Corp. is considering the purchase of a new piece of equipment, which would have an initial cost of $1,000,000 and a 5-year life. There is no salvage value for the equipment. The increase in cash flow each year of the equipment’s life would be as follows:      Year 1 $ 375,000 Year 2 $ 350,000 Year 3 $ 285,000 Year 4 $ 230,000 Year 5 $ 185,000   What is the payback period?

Olive Corp. currently makes 20,000 subcomponents a year in one of its factories. The unit costs to produce are:    Per unit Direct materials   $ 12 Direct labor     8 Variable manufacturing overhead     12 Fixed manufacturing overhead     8 Total unit cost   $ 40 An outside supplier has offered to provide Olive Corp. with the 20,000 subcomponents at a $36 per unit price. Fixed overhead is not avoidable. If Olive Corp. accepts the outside offer, what will be the effect on short-term profits?

North Division has the following information: Sales              $1,200,000 Variable expenses        640,000 Fixed expenses             620,000 If this division is eliminated, the fixed expenses will be allocated to the company’s other divisions. What is the incremental effect on net income if the division is dropped?

Fornelli, Inc. can produce 100 units of a component part with the following costs: Direct Materials            $15,000 Direct Labor            6,500 Variable Overhead      16,000 Fixed Overhead           11,000 If Fornelli, Inc. can purchase 100 units of the component part externally for $44,000 and only $4,000 of the fixed costs can be avoided, what is the correct make-or-buy decision?

Homer Corp. is considering the purchase of a new piece of equipment. The cost savings from the equipment would result in an annual increase in net income after tax of $100,000. The equipment will have an initial cost of $400,000 and have a 5-year life. If the salvage value of the equipment is estimated to be $75,000, what is the annual net cash flow as a result of this investment? (assume that straight-line depreciation method is used)

Byron Corp. is considering the purchase of a new piece of equipment. The cost savings from the equipment would result in an annual increase in cash flow of $100,000. The equipment will have an initial cost of $400,000 and have a 5-year life. The salvage value of the equipment is estimated to be $75,000. If the hurdle rate is 10%, what is the approximate net present value? Ignore income taxes.