The Marx Brewing Company Recently Installed a New Bottling Machine

question 32

Essay

The Marx Brewing Company recently installed a new bottling machine. The machine's initial cost is $2,000, and can be depreciated on a straight line basis to a zero salvage in 5 years. The machine's per year fixed cost is $1,800, and its variable cost is $0.50 per unit. The selling price per unit is $1.50. Marx's tax rate is 34%, and it uses a 16% discount rate. If Marx sells 2500 units what is the accounting profit and contribution margin for Marx Brewing?

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Definitions:

Enthymeme

An argument in which one premise is not explicitly stated, often used in persuasive speech and writing.

Missing Premise

An implicit assumption or statement required to make an argument logically sound but is not explicitly stated.

Traditional View

A perspective or belief system that is based on long-established customs, practices, or institutions.

Existential Import

This concept refers to statements that imply the existence of at least one instance of the subject being discussed.