Arizona Health Services (AHS) buys $500,000 of a particular item (at gross prices) from its major supplier, Cardinal Health, which offers AHS terms of 3/20, net 60. Currently, the hospital is paying the supplier the full amount due on Day 60 but it is considering taking the discount, paying on Day 20 and replacing the trade credit with a bank loan that has a 12% interest rate.

1. What is the approximate annual cost of the costly trade credit?

A.13.80%
B.27.80%
C.50%

2. Should AHS replace its trade credit with the bank loan?

A. No. The bank loan rate is higher than the costly credit rate, so AHS should take the costly credit.
B. Yes. The bank loan rate is lower than the costly credit rate, so AHS should take the bank loan and refuse all trade credit.
C. Yes. The bank loan rate is lower than the costly credit rate, so AHS should replace the costly credit portion of the credit with a bank loan.
D. Yes. The bank loan rate is higher than the costly credit rate, so AHS should take the credit.

3. If the bank loan is used, how much of the trade credit should be replaced?

A. $13,477
B.$26,944
C.$53,889
D.$80,233

Oceanside marine company manufactures special metallic materials and decorative fittings for luxury yachts that require highly skilled labor. oceanside uses standard costs to prepare its flexible budget. for the first quarter of the year, direct materials and direct labor standards for one of their popular products were as follows: direct materials: 2 pound per unit; $ 11 per pound direct labor: 2 hours per unit; $ 19 per hour oceanside produced 2 comma 000 units during the quarter. at the end of the quarter, an examination of the direct materials records showed that the company used 7 comma 500 pounds of direct materials and actual total materials costs were $ 98 comma 100. what is the direct materials cost variance? (round any intermediate calculations to the nearest cent, and your final answer to the nearest dollar.)

To : of $25 up to 35 2 35 up to 45 5 45 up to 55 7 55 up to 65 20 65 up to 75 16 is$25 up to $35 ?

German brothels recently began offering a monthly subscription service for multiple purchasers. if you thought that the brothels' encouragement of prostitution was immoral to begin with, would you consider this pricing plan to be even more immoral? suppose a particular patron at a german brothel has the following willingness-to-pay schedule for services at the brothel, per session. session willingness to pay 1st $84 2nd $72 3rd $60 4th $48 5th $36 6th $24 suppose this consumer would not demand any more sessions, even for free. also assume that the marginal cost to the brothel, per session, is constant at $12. at a price of $78.00 per session, the number of sessions demanded by this consumer would be . at this price and quantity, consumer surplus is $ and producer surplus is $ . suppose the brothel has devised a new pricing scheme for consumers who demand more than 1 session. this pricing scheme is a subscription service, whereby consumers can pay a flat fee of $259.20 and can have up to 6 sessions total. using this subscription pricing model, this consumer would demand sessions. under this scenario, consumer surplus is $ and producer surplus is $ . (hint: for consumer surplus, consider how much total value the consumer places on all sessions, versus the total price paid.)