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IceJOKER [234]
2 years ago
8

If washburn guitars were to lower the price of the maya pro dd75 to $2,499 from $2,699, sales of the guitar would increase 30 pe

rcent. This illustrates.
Business
1 answer:
inn [45]2 years ago
3 0

The Washburn guitars reduces their price from  $2,499 to $2,699 as a result of the sales of the product drastically increased by 30%, So this represents that the <u>product has an elastic demand.</u>

<h3>What do you mean by elastic demand?</h3>

When the price of a product has a massive effect on the quantity purchased is called Elastic demand. A product is stated to have an elastic demand if sales drop sharply in reaction to a growth in price, or sales spike whilst prices are decreased.

Thus, The Washburn guitars reduces their price from  $2,499 to $2,699 as a result of the sales of the product drastically increased by 30%, So this represents that the <u>product has an elastic demand.</u>

Learn more about elastic demand:

brainly.com/question/5078326

#SPJ1

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What is a cottage industry?
MatroZZZ [7]
Cottage Industry is a business or manufacturing activity carried on in a person's home.
7 0
3 years ago
Weber Company purchases $52,200 of raw materials on account, and it incurs $62,200 of factory labor costs. Supporting records sh
netineya [11]

Answer:

This problem requires us to pass journal entry to assign overhead to the Assembly and Finishing Departments.

We know that overhead is allocated on estimation basis through applied overhead account. The basis of assignment is given in the question. The overhead will be assigne/recorded in relevant department work in process cost account. The journal entry is given below.

Debit Assembly WIP Account                         $ 70,720

(44,200*1.6 = 70.720)

Debit Finishing WIP Account                           $ 28,000

((62,200-44,200)*1.6 = 28,800)

Credit Factory Overhead applied Account    $ 99,520

3 0
3 years ago
Canine Crates just paid an annual dividend of $.45 per share but plans to double that amount each year for three years. After th
Taya2010 [7]

Answer:

e) $23.89

Explanation:

The question is to determine the value of Canine Crates stock today  based on a return rate of 13%

The first step is to determine the yearly value based on the dividend for three years as follows

D1= The annual dividend x 2 ( since Canine Crates plans to double the amount each year for three years

D1= $0.45 x 2 = $0.9

D2= $0.90 x 2 = $1.80

D3= $1.80 x 2 = $3.60

Based on these calculations, we calculate the value of the stock by adding the present values of the dividend of each year.

This is based on the following formula

Dividend per year / (1+r)∧n

= Dividend per year

r = required rate

n= period

Value of the stock = $0.9 / (1.13) + $1.80 / (1.13)∧2 + $3.60/ (1.13)∧3

The value of the stock = $23.89

3 0
3 years ago
Read 2 more answers
Income statements under absorption and variable costing Gallatin County Motors Inc. assembles and sells snowmobile engines. The
9966 [12]

Answer:

Gallatin County Motors, Inc.

a. Gallatin County Motors Inc. Absorption Costing Income Statement For the Month Ended July 31:

Sales (3,000 units)                           $2,310,000

Production costs (3,000 units):

Direct materials              $993,300

Direct labor                       427,200

Variable factory overhead 69,600

Fixed factory overhead    109,200

Total production costs  1,599,300    1,599,300

Gross profit                                          $710,700

Selling and administrative expenses:

Variable selling and administrative    $49,600

Fixed selling and administrative          20,800

Net Income                                       $640,300

b. Gallatin County Motors Inc. Variable Costing Income Statement For the Month Ended July 31:

Sales (3,000 units)                                             $2,310,000

Production costs (3,000 units):

Direct materials                                 $993,300

Direct labor                                          427,200

Variable factory overhead                    69,600

Variable selling and administrative     49,600

Total production costs                    1,539,700    1,539,700

Contribution                                                         $770,300

Fixed expenses:

Fixed factory overhead                    109,200

Fixed selling and administrative       20,800       130,000

Net Income                                                        $640,300

c. Reason for the difference in the amount of the operating income in (a) and (b):

There is no difference in this case.  A difference would arise if there were  beginning and closing inventories from the different treatment of fixed production overheads, which are absorbed in the product costs.

Explanation:

Gallatin County Motors, Inc.'s income statement under absorption costing technique measures the cost of production and net income by taking into full account the full production costs, including fixed overheads.  It reports a gross profit figure which compares the full cost of production and the service revenue.

On the other hand, Gallatin County Motors, Inc.'s income statement under the variable costing technique measures the cost of production and net income by taking into account all the variable costs.  With this technique, a contribution margin is the difference between service revenue and variable costs.

Differences in the reported net income arise from the presence of beginning and ending inventory.  Another difference is that while absorption costing income statement reports a gross profit figure before net income, the variable costing income statement reports a contribution margin and, in addition, regards all fixed costs as period costs.

5 0
3 years ago
On December​ 1, 2019,​ Carrie's Day Care receives $ 2 comma 700 in advance for an agreement to care for​ Susan's children for th
blagie [28]

Answer:

Unearned Revenue $900 (debit)

Revenue $900 (credit)

Explanation:

On 1 December Carrie's Day Care recorded Unearned Revenue of $2,700 the entry is as follows ;

Cash $2,700 (debit)

Unearned Revenue $2,700 (credit)

By end of the first month (31 December) one month`s revenue will have been earned and the unearned revenue balance decreases. The entries are as follows :

Unearned Revenue $900 (debit)

Revenue $900 (credit)

<em>Calculation : December Revenue = 1/3 × $2,700 = $900</em>

4 0
3 years ago
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