Use the Following Information to Answer Questions 39 - 43

question 1

Multiple Choice

Use the following information to answer Questions 39 - 43
Jim's Production is planning on acquiring a competitive firm with a view to change production technologies.The two firm technologies produce the same output but with different cost functions.Jim's Production technology has a cost function = 1000 + 0.10Q whereas the competitor's cost function = 500 + 0.15Q.
-If the company plans to produce 5000 units of output,is acquiring the competitor's technology a good idea?

• A)Yes,because the competitor has a low-marginal-cost technology
• B)Yes,because the competitor has a high-marginal-cost technology
• C)Yes,because the company plans to produce less than the break-even quantity
• D)Both b and c

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Definitions:

Income Statement Account

A financial account that shows the company's revenues, expenses, and net income over a specific period.

Petty Cash Transactions

Small purchases or expenditures paid using a readily available cash fund.

Cash Over and Short

An account that reports the discrepancies between the physical count of cash and the recorded amounts in a business's financial records.

Internal Control Procedures

Systems and policies put in place by a company to ensure the accuracy and integrity of financial and accounting information, prevent fraud, and comply with laws.