Answer:
No change
Explanation:
The complete question is <em>"The fictional country of Alpetra increases the income tax rate so that tax revenues increase by $50 million. If GDP, consumption, and Government spending remains the same and Alpetra is a closed economy, what is the change in investment?"</em>
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The closed economy equilibrium is at: Y = C + I + G. Where Y = Real GDP, C = Consumption, I = Investment and G = Government spending.
The Y, C, G are constant so the investment is not changed. I = Y - C - G. So, this is the same before-tax and after-tax change.
Capital
Capital have credit balance because capital is the owner's investment in the business and its a liability for the business to pay the capital in future.
Increase will capital have credit balance and it is reported on the liabilities side of the balance sheet.
Cash , expense, accounts receivable have debit balance as it is treated as asset of the business and have debit balance.
As per the double entry system , every transaction has debit and credit. multiple accounts are affected.
The amount of capital will always equal to the the all assets less all liabilities.
In the year end , profit or loss is apportioned in the capital account.
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Answer:
Barney's corporation retained earnings would be overstated by $13.65 million
Explanation:
First of all this cumulative amortization that is being putted on the patent represents the total amount of amortizations expense which is being charged against this intangible asset(patent in this case) over a period of its useful life.
Now because of the changes in marketing forecast , the Barney Corporation decided to reduce the useful life of the patent, earlier if the life would have not been reduced then the cumulative amortization expense on the patent would have been $21 million higher than it is now, which means Barney corporation now has to charge less expenses because now the projected life of patent has been reduced, that leads to the higher profits for the corporation because no the expenses are less. Now we will charge 35% of tax rate on this $21 million which is leading to overestimating the retained earnings of the corporation ,
barney's retained earnings = $21 million - $21 million x 35%
= $21 million - $21 x 35/100
= $21 million - $7.35
= $13.65 million
Answer:
firms originate, produce, and market their products and services worldwide.
Explanation:
Globalization can be defined as the strategic process which involves the integration of various markets across the world to form a large global marketplace. Basically, globalization makes it possible for various organizations to produce goods and services that is used by consumers across the world.
Some examples of international economic organizations involved in global economy and trade are;
World Trade Organization (WTO).
United Nations (UN).
International Monetary Fund (IMF).
Global competition exists when firms originate, produce, and market their products and services worldwide.
