Financial Management Decision Making:1. Mr. A is the owner of a grocery store. He was informed by the Fortune Cigarette supplier today that the priceof Fortune Cigarette starting March 01, 2021 will be 1,000.00 per pack (Former Price of 900.00). He constantlyorders 300 packs of Fortune Cigarette every week. Mr. A has extra cash of 270,000.00, would he grab theopportunity and double his weekly purchase of cigarettes before the price increase?2. Given the same scenario in number 1 but here Mr. A has NO extra cash. But Mr. A can immediately make abank loan of 270,000.00, two months to pay and with total interest for two months of 50,000.00 would he grabthe opportunity and double his weekly purchase of cigarettes before the price increase?3. Given the same scenario in number 1 but here Mr. A has NO extra cash. But Mr. A can immediately make abank loan of 270,000.00, two months to pay and with total interest for two months of 10,000.00 would he grabthe opportunity and double his weekly purchase of cigarettes before the price increase?4. Mr. B is the owner of a hardware store. His ten wheeler truck is under going major repair. Mr. B badlyneeded 1,000 bags of cement to fill the orders of his loyal customers. The 1,000 bags of cement should bepicked up from the production site in Bulacan. If he will hire a trucking service, he would only break-even withall the cost of trucking against the profit he would make. What do you think Mr. B decided?

Increase in Price per pack = 1,000 - 900 = 100 Total Impact on weekly order = 100 * 300 = 30,000…

Answered: 1. Mr. A is the owner of a grocery…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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