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I need a complete solution and answer for this question The president of Southeast Appliance Center notes that Department 3 has been operating at a
I need a complete solution and answer for this question
The president of Southeast Appliance Center notes that Department 3 has been operating at a loss. The president reasons that profits will be increased by P 9,000 by elimination of this department in as much as costs of this department are in excess of revenue by this amount. Department 2 3 4 Total 1 Revenue P 132,000 P 168,000 P 125,000 P 98,000 P 523,000 Direct labor cost of dept. Allocated company costs Total Costs Net Income (Loss) 82,000 108,000 104,000 61,000 355,000 30,000 36,000 30,0000 25,000 121,000 P(112,000) P (144,000) P(134,000) P(86,000) P(476,000) P 20,000 P 24,000 P (9,000) P 12,000 P 47,000 Required: Is the president correct? Prepare an analysis to indicate what the results would be if Department 3 will be eliminated. The Dwight Company plans to invest in a duplicating machine that costs P 120,000. The following are the expected annual cash inflows that are evenly received each month and the estimated salvage value at any point of each year. Year 1 2 3 4 5 Cash Inflows P 40,000 36,000 32,000 28,000 25,000 Salvage Value P50,000 40,000 28,000 20,000 5,000 Direction: Compute the bail-out period for this project. Show your computations to support your answersStep by Step Solution
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