Answer:
It will increase expense, thereby reducing the profit mentioned in the income statement and decrease the current asset (debtor) recorded in the balance sheet.
Explanation:
Bad Debt is an expense that is recorded when it is expected that the customer, who owes a debt to the business, might default in clearing their dues.
As such when the bad debt amount is increased it will result in a rise in expense and therefore the profit, as stated in the profit and loss (income statement) of the sole trader would decrease.
Moreover, it will also decrease the value of trade receivables (current assets) mentioned in the balance sheet. The following entry would be recorded:
Bad Debts (Dr) xxxxx
Trade Receivables (Cr) xxxxxx
Hence, the expenses will increase while the current asset will decrease.
Answer:
B. Miniperm loan
Explanation:
A mini perm loan is a form of temporary loan of financing that is used in commercial projects before those commercial projects becomes profitable. It is a temporary loan that is used to pay off construction loan and it is typically payable in three to five (3 - 5) years. It is a short term loan also used in the acquisition of investments properties. In this scenario, the developer would most likely seek financing in form of mini-perm loan.
A.profitability ?
I never took business but in accounting we calculate Return on capital employed and it's a measure of profitability.
Answer:
The answer is below
Explanation:
1) Opportunity cost of producing rice:
For country A, opportunity cost of producing rice = 100 pounds of broccoli / 200 pounds of rice = 1/2 pounds of broccoli
For country B, opportunity cost of producing rice = 120 pounds of broccoli / 160 pounds of rice = 3/4 pounds of broccoli
Opportunity cost of producing broccoli:
For country A, opportunity cost of producing broccoli = 200 pounds of rice / 100 pounds of broccoli = 2 pounds of rice
For country B, opportunity cost of producing broccoli = 160 pounds of rice / 120 pounds of broccoli = 4/3 pounds of rice
2) The country with comparative advantage is the country with lower opportunity cost.
Country A has a comparative in producing rice (1/2 pounds of broccoli < 3/4 pounds of broccoli)
Country B has a comparative in producing broccoli (4/3 pounds of rice < 2 pounds of rice)
3) For better off trade, the price should lie between two different opportunity costs.
Therefore, the price per pound of broccoli in terms of pounds of rice should lie between 4/3 and 2 pounds of rice
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