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1 year ago

Question #10

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When there is an increase in taxes and the decreasing government spending during an economic expansion the purpose is to to slow down aggregate demand and reduce inflation

<h3>What is meant by contractionary government policy?</h3>

This is the tool that the government may use when they want to stimulate the economy. The government may decide to raise taxes, this would have an adverse effect on consumption in a given economy.

Another way they may do this would be through the decrease in the way that the government spends money in the economy.

Read more on contractionary policies here:

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A customer opens a margin account by purchasing 100 shares of ABC at $60 per share, depositing the 50% Regulation T requirement.

Scilla [17]

Answer:

Account Balance in margin account:

Investment = $6,000 (100 x $60)

The customer's account will first increase with an unrealized gain of $2,000 ($80 - 60 x 100) on the next day. It will then decrease with an unrealized loss of $2,000 ($80 - 60 x 100) on the day after. This cancels the earlier unrealized gain.

Explanation:

The customer's investment will now show a balance of $6,000 with a contra account showing a debt of $3,000 for the balance of the Regulation T margin account. According to investopedia, "A margin account is a brokerage account in which the broker lends the customer cash to purchase stocks or other financial products. The loan in the account is collateralized by the securities purchased and cash, and comes with a periodic interest rate."

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3 years ago

The beginning inventory of BG Action Figures is understated by $7 million at December 31, 20x8. What is the effect on 20x8 cost

pogonyaev

Answer:

$7million understated

Explanation:

Based on the information given the effect on 20x8 COST OF GOODS SOLD will be UNDERSTATED by $7 million reasons been that since the OPENING INVENTORY IS UNDERSTATED by $7 million which means that the COST OF GOODS SOLD will as well be UNDERSTATED by the same amount based on the fact that opening inventory adds to Cost of goods sold.

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3 years ago

Harrison and Sherrie are making decisions on their bank accounts. Harrison wants to put more money in as a principle amount beca

Troyanec [42]

Sherrie wants to put the original money in an account with a higher interest rate. Explain which method will result in more money.

Answer: In this case I would say that both Sherrie and Harrison are good methods that will result in more money. As to find out which idea would make the most bang for the buck we would need actual data like interest rates.

I hope it helps, Regards.

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4 years ago

Read 2 more answers

(b) The following expenditures relating to plant assets were made by Prather Company during the first 2 months of 2020. Opposite

densk [106]

Answer:

Please see explanation below

Explanation:

1. Paid $5,000 of accrued taxes at time plant site was acquired. - Debit accrued taxes account $5000, credit cash expenses account $5000.

2. Paid $200 insurance to cover possible accident loss on new factory machinery while the machinery was in transit. - Debit freight and insurance in transit $200, credit cash expenses $200.

3. Paid $850 sales taxes on new delivery truck. - Debit sales tax $850, credit expenses $850.

4. Paid $17,500 for parking lots and driveways on new plant site. - Debit land improvements $17,500, credit cash expenses $17,500.

5. Paid $250 to have company name and advertising slogan painted on new delivery truck. - Debit advertisement $250, credit cash expenses $250.

6. Paid $8,000 for installation of new factory machinery. - debit installation costs (under plants and machinery $8000.

7. Paid $900 for one-year accident insurance policy on new delivery truck. - Debit insurance $900, credit cash expenses $900.

8. Paid $75 motor vehicle license fee on the new truck. - Debit licensing fees $75, credit cash expenses $75.

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3 years ago

Read 2 more answers

Conduct a horizontal analysis by calculating the year-over-year changes in each line item, expressed in dollars and in percentag

Iteru [2.4K]

Answer:

Computer Tycoon, Inc.

1. Horizontal Analysis, calculating the year-over-year changes in each line:

Computer Tycoon, Inc. Income Statements For the Year Ended December 31

2016 2015 Dollars %

Sales Revenue $108,000 $132,000 -$24,000 -18.2%

Cost of Goods Sold 64,000 74,700 -$10,700 -14.3%

Gross Profit 44,000 57,300 -$13,300 -23.2%

Selling, General, & Administrative

Expenses 36,800 38,600 -$1,800 -4.7%

Interest Expense 580 515 $65 +12.6%

Income before Income Tax Exp. 6,620 18,185 -$11,565 -63.6%

Income Tax Expense 1,500 5,800 -$4,300 -74.1%

Net Income $5,120 $12,385 -$7,265 -58.7%

2-A. Vertical analysis by expressing each line as a percentage of total revenues:

Computer Tycoon, Inc. Income Statements For the Year Ended December 31

2016 % 2015 %

Sales Revenue $108,000 100 $132,000 100

Cost of Goods Sold 64,000 59 74,700 56.6

Gross Profit 44,000 41 57,300 43.4

Selling, General, & Administrative

Expenses 36,800 34 38,600 29.2

Interest Expense 580 0.5 515 0.4

Income before Income Tax Exp. 6,620 6 18,185 13.8

Income Tax Expense 1,500 1.4 5,800 4.4

Net Income $5,120 4.7 $12,385 9.4

2-B No. It made less profit per dollar of sales in 2016 compared to 2015.

Explanation:

a) Horizontal analysis is the analysis of financial statements to show changes in the amounts of corresponding financial statement items over a period of time. It is used to evaluate the trend situations, using financial statements for two or more periods.

b) Vertical analysis is another technique for analyzing financial statements with each line item being listed as a percentage of a base figure within the statement. For income statement, the base figure is usually the Sales Revenue, while for balance sheet, the base figure is the total assets.

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3 years ago