Close Substitutes.
When the price of a commodity rises, the demand for its close substitute is likely to rise because the price of the close substitute remains the same.
Answer:
The required journals to be recorded are as follows:
On January 10:
Debit Accounts receivable $20,900
Credit Sales revenue (credit) $20,900
<em>(To recognize account receivables on merchandise sale)</em>
On February 9:
Debit Notes receivable $20,900
Credit Accounts receivable $20,900
<em>(To reclassify accounts receivable to notes receivable)</em>
On March 9:
Debit Interest receivable $174.17
Credit Interest revenue $174.17
<em>(To record interest on notes receivables [</em>$20,900 x 10%/12]<em>)</em>
Explanation:
- First, on January 10, when Metlock Inc. sold merchandise on account to Monty Co., Metlock has to recognize an accounts receivable because the sales transaction was on account.
- However, since Monty gave a 10% promissory note, Metlock has to record the same by reclassifying the initially recognized accounts receivable to notes receivable, since that is what the company is expecting.
- The 10% on the promissory notes means Metlock would be recognizing the amount in its interest revenue.
Answer:
Procurement department is the best suited answer
Explanation:
Emma is following the procedure of procurement here as it is the responsibility of procurement to search the desired product and negotiate it. It is the job of procurement department to issue purchase orders, develops term contracts, and acquires supplies and services. Although it is the higher authorities to have a final say but it is the job of procurement department to enlist and gather all the information for the higher authorities.
Answer:
Dr amortization expense $14,500
Cr Copyright asset $14,500
Dr amortization expense $6,250
Cr Patent asset $6,250
Explanation:
First of all,a goodwill with an indefinite life is not depreciable,hence no adjusting journal entries would be prepared in respect of the goodwill.
However,the copyright would be amortized using the lower of useful life of 6 years and legal life of 30 years,the amortization expense for the year is shown below:
amortization charge=$87,000/6 years=$14,500
The patent is to amortized in the way as the as the copyright the lower of useful life and legal life.
amortization charge=$30,000/4 years*10/12=$6250
The patent was only used for 10 months in the year
