Infinity Clock Company Prepared the Following Static Budget for the Year

question 136

Multiple Choice

Infinity Clock Company prepared the following static budget for the year: $$\begin{array} { | l | c | r | } \hline \text { Static Budget } & & \\\hline \text { Units/Volume } & & 9000 \\\hline& \text { Per Unit } \\\hline \text { Sales Revenue } & \$ 5.00 & \$ 45,000 \\\hline \text { Variable Costs } & 1.50 & \underline { 13,500 } \\\hline \text { Contribution Margin } &&31,500 \\\hline \text { Fixed Costs } & & \underline { 3000 }\\\hline \text { Operating Income/(Loss) } & & \underline { \$28,500 } \\\hline\end{array}$$ If a flexible budget is prepared at a volume of 8900 units, calculate the amount of operating income. The production level is within the relevant range.

• A) $28,150
• B) $28,500
• C) $13,350
• D) $3000

Grasp the mechanism by which interest rates are determined by the supply and demand for loanable funds.

Comprehend the factors that can cause shifts in the supply and demand for loanable funds and their impact on interest rates.

Analyze how external factors like technology, government policies, and individual financial decisions affect the financial market.

Apply discounting techniques to assess the present value of future cash flows and investments.

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Definitions:

Financial Statement Analysis

The process of examining and reviewing a company's financial statements to make informed business decisions.

Efficiency

The ability to achieve maximum productivity with minimum wasted effort or expense.

Effectiveness

The degree to which objectives are achieved and the extent to which targeted problems are solved.

Liquidity

A measure of the ease with which an asset can be converted into cash without significantly affecting its value.