Question

Now suppose she is only able to get $2,000 cash back (with the 3.24% financing from her bank). Does this change her decision

Answer 1

Therefore, abnormal loss is also called an avoidable loss. The value of anabnormal loss is assessed on the basis of the production cost with which the profit and loss account is charged.Value of abnormal loss = (Normal cost of normal output/Normaloutput) X Abnormal loss qty.

Answer 2

Answer to 1) Now suppose she is only able to get $950 cash back (with the 3.20% financing ... Does this change her initial decision? ... She is eligible for the full $2,000 cash rebate