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fiasKO [112]
3 years ago
10

Suppose a state passes a minimum wage law that increases the minimum wage from $5/hour to $20/hour. The equilibrium wage prior t

o the minimum wage hike was $10/hour. Which is likely to result from increasing the minimum wage? The state will experience full employment. The labor market will become more efficient. Some employers and workers will agree on a wage of less than $20/hour and not report the wages to the government. Employers will demand more labor than workers will supply. This result of increasing the minimum wage is an example of a quantity control. Black market. License. Quota rent.
Business
1 answer:
melisa1 [442]3 years ago
6 0

Answer: Some employers and workers will agree on a wage less than $20 and not report the wages to the government; black market

Explanation: When the minimum wage is set above the equilibrium wage it leads to a surplus of labor in the market. There are more job seekers than the firms demand at the minimum wage of $20. Thus, the only possible option will be that some employers and workers will agree on a wage less than $20 and not report the wages to the government. When this happens it leads to black marketing. Black market is an underground economy the transactions of which are not reported to the government.

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The common stock of Buffalo Inc. is currently selling at $113 per share. The directors wish to reduce the share price and increa
ruslelena [56]

Answer:

Buffalo Inc.

a. Journal Entry:

No journal entry required except a memorandum to record the split.  

b. Journal Entry:

Debit Stock Dividend (Retained Earnings) $84 million

Credit Stock Dividend Distributable $84 million

To record the declaration of a 100% stock dividend.

When issued:

Debit Stock Dividend Distributable $84 million

Credit Common Stock $84 million

To record the issuance of stock dividends.

2. Both methods increase the outstanding number of shares by 100%.  However, with a stock split of 2-for-1, there is no journal entry except a memorandum record to state the split.

Secondly, with a stock split or 2-for-1, the market price is also halved.  This does not happen with a stock dividend.  The market forces will determine and correct the market price to an acceptable level.  A stock dividend requires some accounting entries to be made.

Explanation:

a) Data and Calculations:

Current market price of common stock per share = $113

Par value per share = $10

Book value per share = $68

Shares issued and outstanding = 8.40 million

a. The board votes a 2-for-l stock split:

Shares outstanding = 16.80 million shares

Market price = $56.50

Journal Entry:

No journal entry required except a memorandum to record the split.  The value of common stock remains the same.

b. The board votes a 100% stock dividend:

Shares outstanding will increase to 16.80 million shares

Market price = $113 and level off based on demand and supply.

Journal Entry:

Stock Dividend (Retained Earnings) $84 million

Common Stock $84 million

5 0
3 years ago
Running a company and protecting the interests of owners and other stakeholders is known as _____.
alexandr1967 [171]

Running a company and protecting the interests of owners and other stakeholders is known as <u>Corporate Governance</u>.

<h3>What is a Corporate Governance?</h3>

Basically, the corporate governance refers to the system by which companies are directed and controlled.

The Boards of directors are responsible for the governance of their companies while the shareholders' role in governance is to appoint the directors.

Therefore, the running of a company and protecting the interests of owners and other stakeholders is known as corporate Governance.

Read more Corporate Governance

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3 0
1 year ago
Market penetration, product development, market expansion, and diversification are examples of what?
Elanso [62]

Answer:

B. growth strategies

Explanation:

They are growth strategies, since everything is focused on improving the performance of the company, through product diversification, entering new markets, being able to achieve product development and as it is based on carrying out actions to fulfill said proposed goal that in this case is exponential growth

7 0
3 years ago
Which descriptions about simple interest and yearly compounded interest are true? Check all that apply.
garik1379 [7]

Descriptions about simple interest and yearly compounded interest are true are :

  • Only compound interest has an exponent in its formula.
  • Simple interest is only earned on the original principal investment.
  • Compound interest is earned on principal and interest.

<h3>What is  simple interest and compound interest?</h3>

Simple interest is the one that the calculation is based on principal, or  of a loan.

Compound interest is base on  principal amount as well as the accumulated interest of previous periods.

Learn more about  simple interest at:

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3 0
2 years ago
Ninety percent of businesses in the United States are family-owned and managed and account for 62 percent of total U.S. employme
GuDViN [60]

Answer:

True

Explanation:

Large corporations are like the celebrities of the business world, they appear to be glamorous and powerful, but they only represent a small percentage of total businesses.

Small family businesses are by far the largest employer in the country. Small businesses account for 62% of total employment and the public sector accounts for approximately 17%, so corporations (both large and small) only account for 21%. Proportionally corporations due employ more people (8% of businesses generate 21% of jobs) because they are simply much larger. Almost 97% of small businesses employ less than 20 people (89% of total number of businesses).

3 0
3 years ago
Read 2 more answers
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