Answer:
The correct option is B
Explanation:
According to income tax laws, an individual will pay mess capital gains tax when his basis in an asset is higher. From the example, John has a personal residence and to increase his basis, he needs to think of what to add to the residence such that the selling price would increase and thus capital gain tax will reduce. From the option, the best and likely thing that would increase the basis of his asset (the house) and lead to an increase selling price is adding a new garage.
Answer:
B) the substitution of domestic steel for foreign steel absorbs resources that would otherwise produce goods of greater value
Explanation:
This type of policy is really controversial since politicians like to announce public policies that may help their constituents on the short run, but will eventually end up damaging them and the whole country on the long run.
A clear example is coal mining. Coal mining was praised during the last election and even though some new jobs have been created in that industry, the overall effect in the country is extremely negative and offsets any positive outcome. Coal mining results in heavy pollution and it is also not economically profitable. The resources invested in coal mines could generate much higher benefits for everyone, investors, workers and the government if they were used to finance some other activity.
Currently the government has limited the imports on foreign steel and the domestic production hasn't been able to increase enough to cover the manufacturing needs of American companies and it resulted in higher steel prices and an increase in manufacturing costs.
Market rules apply to everyone and every country. Sometimes it is not possible to produce certain goods at a competitive price no matter how hard we try and the country's well being is negatively affected. Much better results can be obtained by focusing on certain industries where American businesses really excel instead of always trying to favor inefficient industries that have a high lobby power.
Answer:
1. There are 2,600 units in ending inventory.
2. Costs per unit under absorption costing $ 123
3.Value of ending inventory $ 319,800
Explanation:
Calculation of Ending inventory units.
Ending Inventory Units : Opening Units + Units produced - units sold
300 + 15,000 - 12700 = 2,600 units
Calculation of per unit cost under absorption costing
Under absorption costing, direct manufacturing costs as well as indirect factory overheads are considered.
Per units costs
Direct Materials $ 20
Direct Labour $ 60
Variable overhead $ 13
Fixed Overhead $ 30
Total costs per unit $ 123 under absorption costing
Calculation of ending inventory under absorption costing
The ending inventory calculated earlier of 2.600 units is multiplied by the per unit costs of $ 123 per unit to get the value of the ending inventory
$123 * 2600 units = $ 319,800
Answer:
The correct answer is letter "E": undercapitalization.
Explanation:
Undercapitalization refers to the situation in which an organization is unable to generate enough funds to cover its expenses. This leads to companies being unable to pay their creditors, thus, they have no other option but to request for loans to keep the business up and running. Small companies are frequently undercapitalized.
