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1 year ago

Identify the accounting concept that was violated in each of the following situations.

1 answer:

5 0

The typical accounting principles/assumption includes Accrual principle, Conservatism principle., Consistency principle, Cost principle, Economic entity principle, Full disclosure principle, Going concern principle, , Matching principle etc.

<h3>What are the correct concept for each of the following activities using the drop-down list?</h3>

Pastel Paint Company purchased land two years ago at a price of $250,000. Because the value of the assumptions and land has appreciated to $400,000, the company has valued the land at $400,000 in its most recent balance sheet. - The historical cost.

Atwell Corporation has not prepared financial statements for external users for over three years. - The periodicity assumption.

The Klingon Company sells farm machinery. Revenue from a large order of machinery from a new buyer was recorded the day the order was received. - The realization principle.

Don Smith is the sole owner of a company called Hardware City. The company recently paid a $150 utility bill for Smith's personal residence and recorded a $150 expense. - Economic entity assumption.

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The following transactions were made by Ruby Inc. last year:

Juliette [100K]

Answer:

OPtion (C) is correct.

Explanation:

Given that,

Issuance of common stock = $100,000

Dividends paid to the company's stockholders = $2,000

Depreciation expense = $6,000

Repayment of principal on bonds = $40,000

Proceeds from the sale of the company's used equipment = $39,000

Purchase of land = $230,000

Cash flow from financing activities:

= Issuance of common stock - Dividends paid to the common stockholders - Repayment of principal on the company's own bonds

= $100,000 - $2,000 - $40,000

= $58,000

Therefore, the net cash inflow from financing activities is $58,000.

8 0

4 years ago

The greater the magnitude of the external benefits of production, a. The larger is the deadweight loss from underproduction. b

Naddika [18.5K]

Answer:

d. All of the above are true

Explanation:

External costs happen if during production or consumption of a good or a service there is a negative effect on another party. The existence of this can bring about market failure. In the presence of externalities social benefit costs are a combination of private costs and also external benefits of production.

All of the options a, n and c are true so d is the answer here.

7 0

4 years ago

Krepps Corporation produces a single product. Last year, Krepps manufactured 20,000 units and sold 15,000 units. Production cost

slega [8]

Answer:

Under variable costing, the company's net operating income for the year would be $60,000 lower than under absorption costing.

Explanation:

The computation of the operating income under variable costing is shown below:

But before that following calculations need to be done

Fixed manufacturing overhead per unit is

= $240,000 ÷ 20,000 units

= $12 per unit

Ending Inventory units is

= 20,000 units - 15,000 units

= 5,000 units

Now Cost of ending Inventory deferred under absorption costing is

= 5,000 units × $12

= $60,000

So, the second option is correct

5 0

3 years ago

Given the Production Function Q = 72X + 15X2 - X3, where Q =Output and X=Input

Gnom [1K]

Answer:

A. 120

B. 126

C. x=12

D. x=5

Explanation:

A. Calculation to determine the Marginal Product (MP) when X = 8

Production function=Q=72x+15x^2-x^3

Let x be 8

Marginal Product (MP)=dQ/dx

Marginal Product (MP)=72x+15x^2-x^3

Marginal Product (MP)=72+30x-3x^2

Now let plug in X = 8

Marginal Product (MP)=72+30(8)-3(8)^2

Marginal Product (MP)=72+240-192

Marginal Product (MP)=120

Therefore the Marginal Product (MP) when X = 8 will be 120

B. Calculation to determine the Average Product (AP) when X = 6

Average Product (AP)=Q/X

Average Product (AP)=72+15x-x^2

Let plug in x=6

Average Product (AP)=72+15(6)-(6)^2

Average Product (AP)=72+90-36

Average Product (AP)=126

Therefore the Average Product (AP) when X = 6 is 126

C. Calculation to determine at what value of X will Q be at its maximum

Maximizing Q=dQ/dx=0

Maximizing Q=72+30x-3x^2=0

Maximizing Q=3x^2-30x-72=0

Maximizing Q=x^2-10x-24=0

Maximizing Q=x^2-12x+2x-24=0

Maximizing Q=x(x-12)+2(x-12)=0

Hence:

x=12 or (x=-2)

Therefore at what value of X will Q be at its maximum will be at x=12

D. Calculation to determine At what value of X will Diminishing Returns set in

Diminishing returns=dMP/dx=d²Q/dx²

Diminishing returns=30-6x<0

Hence:

x=30/6<0

x=5<0

Therefore at what value of X will Diminishing Returns set in will be at x= 5 or when MP is at a MAXIMUM VALUE.

4 0

3 years ago

Which form of business ownership is the most complex and difficult to form, and why?

Finger [1]

Honestly I would say being an entrepreneur is the most complex and difficult to form, especially if you're trying to build from the ground up it can take a matter of 4-5 maybe more years, this isn't a "answer" ore of an "opinion."

Hope this helped though!

6 0

4 years ago