1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
patriot [66]
3 years ago
8

If the marginal social benefit of consuming a good or a service exceeds the marginal private cost (A) a negative externality exi

sts.(B) the market achieves economic efficiency.(C) the sum of consumer surplus and producer surplus is maximized.(D) a positive externality exists.
Business
1 answer:
Vlad1618 [11]3 years ago
4 0

Answer:

The correct answer is option D.

Explanation:

An externality can be defined as a situation in which the benefit or cost resulting from an activity is received or incurred by a third person.

A positive externality means a third person receives the benefits of someone else's activities.

If the marginal social benefit earned from the consumption of a good is higher  than the marginal private cost incurred then in that case we can say that a positive externality exists in the market.

People have to pay less but are having greater profit.

You might be interested in
The most profitable form of business is
aev [14]

Answer:

d

Explanation:

6 0
2 years ago
On December 31, 2020, Pronghorn Inc. has a machine with a book value of $1,372,400. The original cost and related accumulated de
MaRussiya [10]

Question: I was unable to find the complete question on the google search, however I find a question that was similar to the question you pasted. So I will prefer to solve the following question:

On December 31, 2017, Travis Tritt Inc. has a machine with a book value of $940,000. The original cost and related accumulated depreciation at this date are as follows.

Machine                                         $1,300,000

Less: Accumulated depreciation <u>  360,000   </u>

Book value                            $940,000

Depreciation is computed at $60,000 per year on a straight-line basis.

Presented below is a set of independent situations. For each independent situation, indicate the journal entry to be made to record the transaction. Make sure that depreciation entries are made to update the book value of the machine prior to its disposal.

A) A fire completely destroys the machine on August 31, 2018. An insurance settlement of $430,000 was received for this casualty. Assume the settlement was received immediately.

b) On April 1, 2018, Tritt sold the machine for $1,040,000 to Dwight Yoakam Company.

(c) On July 31, 2018, the company donated this machine to the Mountain King City Council. The fair market value of the machine at the time of the donation was estimated to be $1,100,000.

Answer:  

Case A

In this case the machine was destroyed by fire. Fortunately, it was insured and as a result we received an amount of $430,000. This is the recoverable amount. Now we will treat this accident as a disposal and calculate the loss on the disposal of the asset.

Step 1 Remove all the accumulated depreciation associated with the Machine

Dr Accumulated Depreciation  $360,000

Step 2 Remove the value of the Asset by cost from the Machine account

Cr   Machine (cost)         $1300,000

Step 3 Calculate the Depreciation for the 8 months

$60,000 is calculated for one year and is given in the question.

For 8 months:

Depreciation for 8 months = $60,000 * 8/12 = $40,000

Dr Depreciation Expense  $40,000

Step 4 Record the insurance received as cash received due to asset destruction.

Dr Cash Received   $430,000

Step 5 Calculate the loss or profit on the destruction

(Profit) / Loss = $1300,000 Cost - $360,000 Accumulated Depreciation - Cash Received $430,000 - $40,000 Depreciation for 8 months = $470,000

We have a loss of $470,000 and we should record it by:

Dr Loss on Disposal  $470,000

Summary

Dr Loss on Disposal                $470,000

Dr Depreciation Expense         $40,000

Dr Cash Received                     $430,000

Dr Accumulated Depreciation  $360,000

Cr               Machine (cost)                            $1300,000

Case 2

In this case the asset is been sold for $1040,000 in the start of April,2018 which means it is sold after 3 months.

The first two steps are same.

Step 1 Remove all the accumulated depreciation associated with the Machine

Dr Accumulated Depreciation  $360,000

Step 2 Remove the value of the Asset by cost from the Machine account

Cr   Machine (cost)         $1300,000

Step 3 Calculate the Depreciation for the 3 months

For 3 months:

Depreciation for 3 months = $60,000 * 3/12 = $15,000

Dr Depreciation Expense  $15,000

Step 4 Record the cash received due to asset disposal.

Dr Cash Received   $1,040,000

Step 5 Calculate the loss or profit on the destruction

(Profit) / Loss = $1300,000 Cost - $360,000 Accumulated Depreciation - Cash Received $1,040,000 - $15,000 Depreciation for 3 months = ($115,000)

We have a Profit of $115,000 and we should record it by:

Cr Profit on Disposal  $115,000

Case C

In this case, the asset is donated at the start of July, 2018. This asset will be treated the same way but their is exception that it will be revalued to the fair value of the asset and thereafter will treated as disposal for making donations. This fair value will be treated as Donation Expense and will be debited.

Revaluation of the asset:

The asset will be revalued to $1,100,000 from its carrying value. Its carrying value is $940,000 and the excessive amount will be 160,000 which will be adjusted against accumulated depreciation.

Dr Accumulated depreciation $160,000

Cr Revaluation reserve                        $160,000

Now we will treat the asset as disposal and will remove the revaluation reserve according to IAS 16 Property, Plant and Equipment. The adjustment will go to Retained earnings:

Dr Revaluation reserve   $160,000

Cr Retained Earnings               $160,000

Now we will treat the asset as disposal made against Donation:

Step 1 Remove all the accumulated depreciation associated with the Machine by $200,000 (360,000-160,000).

Dr Accumulated Depreciation  $200,000

Step 2 Remove the value of the Asset by cost from the Machine account

Cr   Machine (cost)         $1300,000

Step 3 Calculate the Depreciation for the 6 months

For 6 months:

Depreciation for 6 months = $60,000 * 6/12 = $30,000

Dr Depreciation Expense  $30,000

Step 4 There is no cash receipt because of the asset donation.

Step 5 Calculate the loss or profit on the destruction

(Profit) / Loss = $1300,000 Cost - $200,000 Accumulated Depreciation - Cash Received $0 - $30,000 Depreciation for 6 months = $1,070,000

We have made a donation of $1,070,000 and we should record it as expense:

Dr Donation Expense  $1,070,000

3 0
3 years ago
What is the prime reason that Jenny's discretionary income is more volatile than her salary?
sweet [91]

Answer:

c. Her mortgage payments and necessities are fixed

Explanation:

Discretionary income is the remaining income after being paid out for all fixed expenses (i.e. Discretionary income = Salary - Mortgage - Income tax etc). The primary reason for variability in it is due to the mortgage payment and fixed expenses from the basic salary received.

So, option c is correct while other options are incorrect as tax does not affect as well as cost of living

7 0
3 years ago
Diners are served in a process with two resources. The first resource has a capacity of 1.1 diners per hour. The capacity of the
Firdavs [7]

The cycle time of this process for the firm is 2.89.

<h3>What is a Cycle Time?</h3>

This refers to the average time between the start of production of one unit and the start of production of the next unit of production

Cycle Time = Net time available to work / Customer demand

Cycle Time = 1.1 + 1.5 / 0.9

Cycle Time = 2.88888888889

Cycle Time = 2.89.

Therefore, the cycle time of this process for the firm is 2.89.

Read more about cycle time

<em>brainly.com/question/18802868</em>

#SPJ1

3 0
1 year ago
A July sales forecast projects that 5,000 units are going to be sold at a price of $12.50 per unit. The management forecasts 2%
Pavlova-9 [17]

Answer:

P_i = 5000 units *12.5\frac{dollars}{unit} = 62500 dollars

And for the new case we know that the sales increase by a factor of 2%, so then we can find the new number of sales like this:

1.02*5000 units= 5100 units

And the Total August sales would be given by:

P_f = 5100 units *12.5 \frac{dollars}{unit}= 63750 dollars

And the correct answer for this case would be:

$63,750

Explanation:

For this case the original number of sales for this case is 5000 units and the unitary price is given by 12.5 \frac{dollars}{unit}

And the total sales for the original case would be given by:

P_i = 5000 units *12.5\frac{dollars}{unit} = 62500 dollars

And for the new case we know that the sales increase by a factor of 2%, so then we can find the new number of sales like this:

1.02*5000 units= 5100 units

And the Total August sales would be given by:

P_f = 5100 units *12.5 \frac{dollars}{unit}= 63750 dollars

And the correct answer for this case would be:

$63,750

7 0
3 years ago
Other questions:
  • At Children's Hospital in Denver, good attendance is encouraged by recognizing staff members who have not missed work in the pre
    8·1 answer
  • Alliance Products purchased equipment that cost $120,000. It had an estimated useful life of four years and no residual value. T
    9·1 answer
  • What effect will each of the following have on the demand for small automobiles such as the Mini-Cooper and Fiat 500?A. Small au
    5·1 answer
  • Assume that the risk-free rate is 3.5% and that the market risk premium is 4%.What is the required rate of return on a stock wit
    11·1 answer
  • You are an industry You are an industry analyst that specializes in an industry where the market inverse demand is P = 200 - 5Q.
    10·1 answer
  • What are the five key things you must know in order to identify opportunities in your area of work?
    9·1 answer
  • Acme Manufacturing makes their preliminary economic studies using a​ before-tax MARR of 17​%.More detailed studies are performed
    14·1 answer
  • Working with people sometimes requires special techniques – what are some for graphic designer job?
    11·1 answer
  • On January 1, 2018, the Highlands Company began construction on a new manufacturing facility for its own use. The building was c
    10·1 answer
  • Mary Walket, president of Rusco Products, considers $14,000 to be the minimum cash balance for operating purposes. As can be see
    11·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!