A pure monopoly without competitors: Group of answer choices Faces a perfectly elastic demand curve for its product. Cannot influence the price of its

Answers

Answer 1

Answer:

d

Explanation:

Here is the complete question

A pure monopoly firm

Select one:

a. faces a perfectly elastic demand curve for its product.

b. will always be able to earn more profit when it raises price.

c. will always earn economic profit, no matter what the level of demand for its product.

d. can influence the price of its product by controlling output

A monopoly is when there is only one firm operating in an industry. there are usually high barriers to entry of firms. the demand curve is downward sloping. it sets the price for its goods and services.

An example of a monopoly is a utility company

A natural monopoly occurs due to the high start-up costs or a large economies of scale.

Natural monopolies are usually the only company providing a service in a particular region  

Characteristics of natural monopolies  

1. they have a large fixed cost  

2. The firms have a low marginal cost

3. They occur naturally through the free market. It does not occur by government regulation or any other force

The demand curve for a pure monopoly is usually inelastic.

Demand is inelastic if a small change in price has little or no effect on quantity demanded. The absolute value of elasticity would be less than one

A monopoly can can influence the price of its product by controlling output

A monopoly will not always earn economic profit no matter the level of output


Related Questions

Data concerning Farm Corporation's single product appear below: Selling price per unit $ 170.00 Variable expense per unit $ 66.30 Fixed expense per month $ 127,490 The break-even in monthly dollar sales is closest to:

Answers

Answer:

1229.4

Explanation:

Breakeven quantity are the number of  units produced and sold at which net income is zero

Breakeven quantity = fixed cost / price – variable cost per unit

$ 127,490 / ( $ 170 -  $ 66.30) = 1229.4

A monopolist that practices perfect price discrimination:_________.
A. charges each consumer the rnaximum price the consumer is willing to pay.
B. drives consumer surplus to zero
C. produces the perfectly competitive level of output.
D. All of the above are correct.
E. Only A and B are correct.

Answers

Answer:

D. All of the above are correct.

Explanation:

A monopoly is a market structure which is typically characterized by a single-seller who sells a unique product in the market by dominance. This ultimately implies that, it is a market structure wherein the seller has no competitor because he is solely responsible for the sale of unique products without close substitutes. Any individual that deals with the sales of unique products in a monopolistic market is generally referred to as a monopolist.

For example, a public power company is an example of a monopoly because they serve as the only source of power utility provider to the general public in a society.

Price can be defined as the amount of money that is required to be paid by a buyer (customer) to a seller (producer) in order to acquire goods and services.

In sales and marketing, pricing of products is considered to be an essential element of a business firm's marketing mix because place, promotion and product largely depends on it.

Price discrimination refers to the situation in which a business firm sells an identical product to different consumers at different selling price based on reasons that are not in any way associated or related with its manufacturing cost.

Hence, a monopolist that practices perfect price discrimination:

A. Charges each consumer the maximum price the consumer is willing to pay.

B. Drives consumer surplus to zero

C. Produces the perfectly competitive level of output.

Answer:

D. All of the above are correct.

Explanation:

Hope this helps

Complete each sentence by selecting the correct term using the drop-down list.

Abbey Company completed the annual count of its inventory. During the count, certain items were identified as requiring special attention. Decide how each item would be handled for Abbey Company's inventory.

items Activities
Goods transit shipped to Abbey (purchaser) FOB Destination
Goods in transit shipped to Abbey (purchaser) FOB Shipping Pont
Goods transit shipped by Abbey (seller) FOU Destination
Goods in transit shipped by Abbey (seller) FOB Shipping Pont

Answers

Answer:

FOB destination means "Free on Board Destination.

1. Goods transit shipped to Abbey (purchaser) FOB Destination

Answer: Exclude from inventory

2. Goods in transit shipped to Abbey (purchaser) FOB Shipping Point

Answer: Include in inventory count

3. Goods transit shipped by Abbey (seller) FOB Destination

Answer: Include in inventory

4. Goods in transit shipped by Abbey (seller) FOB Shipping Point

Answer: Exclude from inventory

3. When Wassily Leontief tested the predictions of the Heckscher-Ohlin theory, he found that in 1947 the United States was exporting relatively labor-intensive goods and importing relatively capital-intensive goods. This finding: A. Contradicted the Heckscher-Ohlin theory as the United States was relatively capital-abundant. B. Contradicted the Heckscher-Ohlin theory as the United States was relatively labor-abundant. C. Was never duplicated by other studies and has thus been labeled a paradox. D. Fit the predictions of the Heckscher-Ohlin theory concerning the trading patterns of a capital-abundant country.

Answers

Answer:

A. Contradicted the Heckscher-Ohlin theory as the United States was relatively capital-abundant.

Explanation:

When Wassily Leontief tested the predictions of the Heckscher-Ohlin theory, he found that in 1947 the United States was exporting relatively labor-intensive goods and importing relatively capital-intensive goods. This finding: "Contradicted the Heckscher-Ohlin theory as the United States was relatively capital-abundant."

This is because Heckscher-Ohlin theory states that countries usually export commodities, and resources they have in excess, while in return, they import the commodities and resources they need.

However, given that the United States is a country that was relatively capital-abundant, Wassily Leontief's finding is considered to be a contradiction.

The following firms in the widget industry have the following market shares:

Spacely Sprocket Widgets 12 %,
Cogswell Cog Widgets 13 %,
Intel Widgets 14 %,
Compaq Widgets 15 %,
IBM Widgets 16%,
Apple Widgets 17 %, &
Microsoft Widgets 13 %.

Required:
Based on this information, what is the Herfindahl Hirschmann Index (HHI) for the Widget Industry ?

Answers

Answer: 1,448

Explanation:

The Herfindahl Hirschman Index (HHI) is used to show how concentrated an industry is. A lower score indicates that the industry is not very concentrated because there are multiple firms involved.

A higher score shows that the industry is concentrated and controlled by a few firms.

HHI = ∑ square of every firm market share

= 12² + 13² + 14² + 15² + 16² + 17² + 13²

= 1,448

This industry is relatively competitive.

The number of people employed in one country is 230 million, with a total number of unemployed people at 40 million. The total population for the country is 500 million. What is the unemployment rate? Group of answer choices

Answers

Answer:

Unemployment rate = 14.81 %

Explanation:

Unemployment is defined as the number of people that are willing and able to work in an economy but that are not able to get employment.

If is used as a measure of the level of economic growth of a country.

Mathematically:

Unemployment rate = (Unemployed) ÷ (Economically active people) *100

Economically active people are employed plus unemployed.

That is 230 million + 40 million = 270 million

Therefore

Unemployment rate = (40/270) * 100

Unemployment rate = 14.81 %

a. Sold merchandise for cash (cost of merchandise $28,797). $ 51,200 b. Received merchandise returned by customers as unsatisfactory (but in perfect condition) for cash refund (original cost of merchandise $360). 600 c. Sold merchandise (costing $4,750) to a customer on account with terms n/60. 10,000 d. Collected half of the balance owed by the customer in (c). 5,000 e. Granted a partial allowance relating to credit sales the customer in (c) had not yet paid.

Answers

Answer:

I guess that you need the journal entries:

a.

Dr Cash 51,200

    Cr Sales revenue 51,200

Dr COGS 28,797

    Cr Inventory 28,797

b.

Dr Sales revenue 600

    Cr Cash 600

Dr Inventory 360

    Cr COGS 360

c.

Dr Accounts receivable 10,000

    Cr Sales revenue 10,000

Dr COGS 4,750

    Cr Inventory 4,750

d.

Dr Cash 5,000

    Cr Accounts receivable 5,000

e.

Dr Sales allowances

    Cr Accounts receivable

ABC company manufactures two products in one process. Joint processing costs up to the split-off point total $33,600 a year. The company allocates these costs to the joint products on the basis of their total sales values at the split-off point. Each product may be sold at the split-off point or processed further. Data concerning these products appear below:

Product X Product Y Total
Allocated joint processing costs $16,800 $16,800 $33,600
Sales value at split-off point $24,000 $24,000 $48,000
Costs of further processing $15,000 $18,700 $33,700
Sales value after further processing $35,500 $45,100 $80,600

What is the financial advantage (disadvantage) for the company of processing Product X beyond the split-off point?
a. ($3,500)
b. $27,700
c. $20,500
d. $3,700


Answers

Answer:

a. ($3,500)

Explanation:

Particulars for Product X                                            Amount

Sales value after further processing                          $35,500

Less: Sales value at split-off point                              $24,000

Total incremental revenue                                         $11,500

Less: Total incremental processing costs                  $15,000

Financial (disadvantage) of further processing      ($3,500)

So, the financial disadvantage for the company of processing Product X beyond the split-off point is $3,500.

The Smelting Department of Kiner Company has the following production and cost data for November. Production: Beginning work in process 2,100 units that are 100% complete as to materials and 20% complete as to conversion costs; units transferred out 9,100 units; and ending work in process 7,100 units that are 100% complete as to materials and 40% complete as to conversion costs. Compute the equivalent units of production for (a) materials and (b) conversion costs for the month of November.

Answers

Answer:

A. 16,200

B. 11,940

Explanation:

Computation for the equivalent units of production for (a) materials and (b) conversion costs for the month of November.

A. Equivalent units of production for materials Materials

Total equivalent units= 9100 + (7100*100%)

Total equivalent units= 9100+7100

Total equivalent units= 16,200

B.Equivalent units of production for conversion costs

Total equivalent units= 9100+ (7100*40%)

Total equivalent units=9100+2840

Total equivalent units= 11,940

Therefore the equivalent units of production for (a) materials is 16,200 and (b) conversion costs for the month of November is 11,940

Middelton Company manufactures a product that passes through two processes: Fabrication and Assembly. The following information was obtained for the Fabrication Department for October:

a. All materials are added at the beginning of the process.
b. Beginning work in process had 81,200 units, 20 percent complete with respect to conversion costs.
c. Ending work in process had 16,100 units, 20 percent complete with respect to conversion costs.
d. Started in process, 104,500 units.

Required:
Prepare a physical flow schedule.

Answers

Answer:

Middelton Company

Physical flow schedule:

                                                         

                                              Units

Beginning work in process  81,200

Started in process             104,500

Units in process                185,700

Ending work in process      16,100

Units completed              169,600  

Explanation:

a) Physical flow schedule:

                                                            Degree of Completion

                                              Units     Materials     Conversion

Beginning work in process  81,200      100%            20%

Started in process             104,500

Units in process                185,700

Ending work in process      16,100       100%            20%

Units completed              169,600       100%           100%

Selected sales and operating data for three divisions of different structural engineering firms aregiven as follows: Division A Division B Division C Sales $ 6,900,000 10,900,000 10,000,000 Average operating assets 1,725,000 5,450,000 2,500,000 Net operating income 414,000 1,090,000 325,000 Minimum required rate of return19.00 % 20.00 % 16.00 % A. Compute the return on investment (ROI) for each division using the formula stated in terms of margin and turnover. B. Compute the residual income (loss) for each division.

Answers

Answer and Explanation:

The computation is shown below:

A.

Return on investment = Margin × Turnover

Now

= (Net operating income ÷Sales) × (Sales ÷ Average operating assets)

Division A = ($414,000 ÷ $6,900,000) × ($6,900,000 ÷ $1,725,000)

= 6% × 4

= 24.00%

Division B = ($1,090,000 ÷ $10,900,000) × ($10,900,000 ÷ $5,450,000)

= 10% × 2

= 20.00%

Division C = ($325,000 ÷ $10,000,000) × ($10,000,000 ÷ $2,500,000)

= 3.25 × 4

= 13.00%

B.  

Residual Income = Net operating income - (Minimum required rate of return × Average operating assets)

Division A = $414,000 - (19% × $1,725,000)

= $414,000 - $327,750

= $86,250

Division B = $1,090,000 - (20% × $5,450,000)

= $1,090,000 - $1,090,000

= $0

Division C = $325,000 - (16% × $2,500,000)

= $325,000 - $400,000

= ($75,000)

MC Qu. 131 At Midland Company's break-even point... At Midland Company's break-even point of 9,000 units, fixed costs are $180,000 and variable costs are $540,000 in total. The unit sales price is:

Answers

Answer:

selling price per unit = $80

Explanation:

Giving the following information:

Company's break-even point of 9,000 units

Fixed costs are $180,000

Total variable costs= $540,000

First, we will calculate the unitary variable cost:

Unitary variable cost= 540,000 / 9,000

Unitary variable cost= $60

Now, the unitary selling price, using the following formula:

Break-even point in units= fixed costs/ contribution margin per unit

9,000 = 180,000 / (selling price per unit - 60)

9,000selling price per unit - 540,000 = 180,000

9,000selling price per unit = 180,000 + 540,000

9,000selling price per unit = 720,000

selling price per unit = 720,000/9,000

selling price per unit = $80

Answer:

$80

Explanation:

The first step is to find the variable cost

= 540,000/9000

= 60

Therefore the unit sales price can be calculated as follows

= 180,000/90,000+60

= 20+60

= $80

Hence the unit sales price is $80

The Marketing Dept. needs to maximize consumer interest in the company's new financial services by sending marketing emails, targeted ads, and texts at prescribed intervals throughout the initial process of attracting and building a relationship with a customer. Riad's team has a large amount of data from previous marketing campaigns that they can analyze to develop a recommended schedule, taking into account a large variety of factors about different types of customers. What kind of technique will this task force need to employ in order to make these recommendations?

Answers

Answer:

Simulation

Explanation:

From the question we are informed about The Marketing Dept. Which needs to maximize consumer interest in the company's new financial services by sending marketing emails, targeted ads, and texts at prescribed intervals throughout the initial process of attracting and building a relationship with a customer. Riad's team has a large amount of data from previous marketing campaigns that they can analyze to develop a recommended schedule, taking into account a large variety of factors about different types of customers. In this case, the kind of technique this task force will need to employ in order to make these recommendations is Simulation.

Simulation can be regarded as imitation of particular operation of a real-world process, real world system within some specific period of time. Most times computers can be used in Execution of the simulation. Simulation can be used in different aspects such as in marketing, education, performance tuning.

Kirchhoff Industries has computed that the proper balance for the Allowance for Doubtful Accounts at August 31 is $143,495. Assume that the allowance for doubtful accounts for Kirchhoff Industries has a credit balance of $6,934 before adjustment on August 31. Required: Journalize the adjusting entry for uncollectible accounts as of August 31. Refer to the chart of accounts for the exact wording of the account titles. KNOW journals do not use lines for journal explanations. Every line on a journal page is used for debit or credit entries. KNOW journals will automatically indent a credit entry when a credit amount is entered.

Answers

Answer:

Date        Account titles and Explanation          Debit         Credit

31 Aug.    Bad debt expense                             $136,561

               ($143,495 - $6,934)

                       Allowance for doubtful accounts                 $136,561

               (To record computed allowance)

Correll Company, which operates a mail-order clothing business, is physically located in State L. This year, the firm shipped $18 million of merchandise to customers in State R. State R imposes a 6 percent sales and use tax on the purchase and consumption of retail goods within the state.

Required:
a. Do State R residents who purchased Firm L merchandise owe use tax on their purchases?
b. If State R could legally require Firm L to collect a 6 percent tax on mail-order sales made to residents of the state, how much additional revenue would the state collect? Explain the reasoning behind your answer.

Answers

Answer:

Correll Company

a. Yes State R residents who purchased Firm L (out-of-state) merchandise owe use tax on their purchases.

b. State R would collect $1,080,000 additional revenue ($18 million * 6%) if Correll was required to collect the use tax at the point of sale and then remit the tax collected to State R.

Explanation:

a) Data and Calculations:

Cost of merchandise to customers in State R = $18 million

State R's sales and use tax on the purchase and consumption of retail goods within the state = 6%

Amount that Correll could collect for State R = $1,080,000 ($18 million * 6%)

b) Note that Correll (Firm L) collecting the State R use tax does not affect State R residents' legal liability to pay the use tax.  Unfortunately, not many people actually remit their self-assessed use tax.

3.How does the theory of efficient production apply to managers of government bureaus or departments that are not run for profit

Answers

Answer:

The theory of efficient production applies to managers of government bureaus or departments that are not run for profit in the following way:

1. The theory helps them to ensure that production resources are optimally allocated to generate value.

2. The theory emphasizes that wastages must be minimized.

3. Efficiency also ensures that processes, policies, and programs are carried out at the right time on each occasion.

Explanation:

Government bureaus or departments require to make decisions about the resources that they require for government services and the value of the output of these services to the public.  The managers ensure that costs are not so much greater than the value created from deploying scarce resources. The best allocation of resources must always be decided to achieve value for money.

In the value chain, what is the term of the activities that are required but not directly add value to the company's products or services sold to the customers

Answers

Answer:

In the value chain analysis, the term of the activities that are required but not directly add value to the company's products or services sold to the customers is:

Support or Secondary Activities.

Explanation:

Support or secondary activities are the indirect services that improve the primary activities of the value chain.  The secondary or support activities include procurement of input resources, human resources management, infrastructure (accounting, legal, and administrative), and research and development (technology). These support the primary value chain activities, according to Porter's Value Chain, including In-bound logistics, Operations, Outbound logistics, Marketing and Sales, and Customer Services.

The neoclassical view holds that long-term expansion of potential GDP due to _______________________ will determine ____________________. Group of answer choices

Answers

Answer:

economic growth; the size of the economy.

Explanation:

Gross Domestic Products (GDP) is a measure of the total market value of all finished goods and services made within a country during a specific period.

Simply stated, GDP is a measure of the total income of all individuals in an economy and the total expenses incurred on the economy's output of goods and services in a particular country. Also, Gross Domestic Products (GDP) is a measure of the production levels of any nation.

Basically, the four (4) major expenditure categories of GDP are consumption (C), investment (I), government purchases (G), and net exports (N).

The new classical theory also known as the neoclassical economic theory is one that repudiates and tends to restructure the John M. Keynes theory of macroeconomics, popularly referred to as the Keynesian Macroeconomics theory.

The new classical theory argues that efficient demand and supply is the most important feature or key behind the level of output, pricing, and consumption of goods and services by the people at a specific period of time in a country. Also, the new classical theory assumes that the wages of the employees in a country is flexible in contrast to the Keynesian macroeconomic theory.

The neoclassical view posits that long-term expansion of potential Gross Domestic Products (GDP) due to economic growth will significantly determine the size of a country's economy.

However, the economy cannot sustain production above its potential Gross Domestic Products (GDP) in the long run.

A distinguishing characteristic of the neoclassical view from other economic theory such as the Keynesian Macroeconomics theory, is flexibility of wages and prices over time.

"How would you need to shift the supply and demand curves in a market to result in a situation where equilibrium quantity increases while the equilibrium price change is indeterminate?"

Answers

Answer:

the demand and supply curve shift outward / to the right

Explanation:

Only a change in the price of a good leads to a movement along the demand curve of that good. Also, only a change in the price of the good would lead to an increase or decrease in the quantity demanded of that good.

Other factors other than the change in the price of the good would lead to a shift of the demand curve. Some of those factors include :

1. a change in consumers' expectation

2. a change in the taste of consumers

3. a change in income

A change in price of a good leads to a movement along the supply curve and not a shift of the supply curve.

Other factors other than a change in the price of the good would lead to a shift of the supply curve. Such factors include :  

1. A change in the price of input  

2. A change in the number of suppliers  

3. Government regulations  

If the demand curve for a good shifts outward as a result of an increase in demand. Equilibrium price and quantity would increase.

If the supply curve for a good shifts outward as a result of an increase in supply, equilibrium price decreases and quantity increases.

Taking these two effects together, there would be an increase in equilibrium quantity while the equilibrium price change is indeterminate

Swifty Corporation has 46,500 shares of $13 par value common stock outstanding. It declares a 15% stock dividend on December 1 when the market price per share is $18. The dividend shares are issued on December 31. Prepare the entries for the declaration and issuance of the stock dividend. (

Answers

Answer:

Common stock dividend distributable = Par * Number of shares * % dividend

= 13 * 46,500 * 15%

= $90,675

Stock Dividend = Number of shares * market price * % dividend

= 46,500 * 18 * 15%

= $125,550

Date          Account Title                                                 Debit               Credit

Dec, 1        Stock Dividend                                          $125,550

                 Common Stock Dividend Distributable                            $90,675

                  Paid in Capital in excess of Par-                                       $34,875

                  Common stock

Date          Account Title                                                 Debit               Credit

Dec, 31      Common Stock Dividend Distributable     $90,675

                 Common Stock                                                                  $90,675

Pontchartrain Company issues $20,000,000, 7.8%, 20-year bonds to yield 8% on January 1, 2017. Interest is paid on June 30 and December 31. The proceeds from the bonds are $19,604,145. The company uses effective-interest amortization. Interest expense reported on the 2017 income statement will total

Answers

Answer:

$1,568,498

Explanation:

First calculate the Amont of discount

Discount on the bond = Face value - Proceeds from the bond = $20,000,000 - $19,604,145 = $395,855  

Now prepare the bond amortization

The Bond Amortization schedule is attached with this answer, please find it.

Now calculate the interest expense for 2017

Interest Expense 2017 = $784,165.80  + $784,332.43

Interest Expense 2017 = $1,568,498.23

Interest Expense 2017 = $1,568,498

Producer surplus directly measures a. the well-being of buyers and sellers. b. the well-being of society as a whole. c. the well-being of sellers. d. sellers' willingness to sell.

Answers

Answer:

c. the well-being of sellers.

Explanation:

A surplus is the amount by which the quantity supplied of a good exceeds the quantity demanded of the good.

Producer surplus is the amount a buyer is willing to pay for a good minus the cost of producing the good.

On the other hand, consumer surplus is the amount a buyer is willing to pay for a good minus the amount the buyer actually pays for it.

Hence, an export subsidy will increase producer surplus.

In conclusion, producer surplus directly measures the well-being of sellers.

Barney Company makes and sells stuffed animals. One product, Michael Bears, sells for $28 per bear. Michael Bears have fixed costs of $100,000 per month and a variable cost of $12 per bear. How many Michael Bears must be produced and sold each month to break even

Answers

Answer:

6,250 units

Explanation:

The computation of the number of units that should be sold and produced in order to break even is shown below:

as we know that

Break even point = Fixed cost ÷Contribution margin per unit

Here

Contribution margin per unit = Selling price - Variable costs

= $28 - $12

= $16

So, the breakeven is

= $100,000 ÷ $16

= 6,250 units

Suppose that the equilibrium exchange rate (Euro/$) is .90 and the The Federal Reserve decides to fix the exchange rate at .70. What will the Federal Reserve have to do in order to maintain this fixed exchange rate

Answers

Answer:

C. The Federal Reserve will need to have official reserves of euros to purchase dollars in the foreign exchange market.

Explanation:

Federal Reserve required to have a euros reserves as it can applied it also at the case when the exchange rate is move upward or downward

For the other things, the fed could restrict the supply with respect to the dollar in the foreign exchange market in order to get it stable that opposed with euro

Therefore the option c is correct

One advantage of countercultures is that they:_____.
a. ensure that corporate mergers occur without any culture clashes.
b. prevent organizations from developing a corporate culture.
c. maintain surveillance over and critically review the company's dominant culture.
d. rarely exist in real organizations.

Answers

Answer:

c. maintain surveillance over and critically review the company's dominant culture.

Explanation:

Counterculture is a sociopolitical term that represent the dissent point lies between the dominant and alternative value system in order to develop the collective voice for considering the minority

Also the employees who have the counter culture belief so it shows the goods source for checking out over and above to the dominant one

Therefore the option c is correct

For any positive interest rate the present value of a given annuity will be less than the sum of the cash flows, and the future value of the same annuity will be greater than the sum of the cash flows.

a. True
b. False

Answers

it’s A true

hope this helps

An abundance of utility-focused blogs exist, posting negative information about utilities in general and even about ABC Utility. Which of the following is NOT a wise response to control the negative blogs?

a. Repost the negative blogs that appear in other places, and argue against the content.
b. Create a company sponsored blog and post blogs with useful information.
c. Monitor the blogs to gather information about public perception.
d. Ask the CEO to frequently write a blog post regarding the values and vision of the organization.

Answers

Answer:

a

Explanation:

Blogs are a good medium that can be used by firms to disseminate information about their goods and services.

Blogs are also a good way to gather information about the perception of consumers to a company's goods and services

A company can make use of blogs to disseminate positive information about their goods and services by creating a company sponsored blog and post blogs with useful information. It would be and advantage if key personals in the firm frequently write a blog post about the firm e.g.  the values and vision of the organization.

How do systems serve different management groups in a business and how do systems that link the enterprise improve organizational performance

Answers

Answer:

In simple words, Enterprise apps are created to bring together a variety of activities and procedures. To facilitate coordination and decision-making, enterprise systems combine a company's major internal business operations into an unified software platform . Supply chains administration software assists a company in managing its relationships with vendors in order to improve product planning, procurement, production, and supply of commodities. 

An aging of a company's accounts receivable indicates that $8400 are estimated to be uncollectible. If Allowance for Doubtful Accounts has a $4820 credit balance, the adjustment to record bad debts for the period will require a

Answers

Answer: Debit to bad debt expense for $3580.

Explanation:

Based on the information given, the bad debt expense will be:

= Desired balance - Actual balance before adjustment

= $8400 - $4820

= $3580

Based on the above, the journal entry will be:

Debit Bad debt expense $3580

Credit Allowance for uncollectible $3580

On January 2, 2016, Rafa Company purchased a franchise with a useful life of 10 years for $50,000. An additional franchise fee of 3% of franchise operating revenues also must be paid each year to the franchisor. Revenues during 2016 totaled $400,000. In its December 31, 2016, balance sheet, what net amount should Rafa report as an intangible asset-franchise

Answers

Answer:

$45,000

Explanation:

Calculation to determine the net amount should Rafa report as an intangible asset-franchise

Acquisition Cost P $50,000

Less: Franchise Amortization $5,000

(P$50,000/10)

Intangible asset-franchise - December 31, 2016 P$45,000

($50,000-$5,000)

Therefore the net amount should Rafa report as an intangible asset-franchise is $45,000

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