Answer:
Total Selling Expenses for the month of February is $241,000
Explanation:
Sales Commissions ($700,000 of sales x 5%) = $35,000
Sales Manager Salary = $96,000
Advertising expenses = $90,000
Shipping expenses = ($700,000 of sales x 2%) = 14,000
Miscellaneous selling expenses = ($2,500 + $700,000 x 1% x 0.5) = $6,000
Total Selling Expenses (Summation of all the calculated above working)= $241,000
Answer:
d. aggregate demand applies to all goods and market demand applies to a specific good.
Explanation:
Market demand is to the quantities of a good or service that customers are able and willing to buy at a given period at a specific price. The focus is on a single product.
Market demand is in the microeconomics category. It addresses the quantities of a product that customers are willing to buy from the market at a specific price. In determining market demand, price is a critical consideration.
Aggregate demand is the total spending by the economy on goods and services at alternative prices over a given period. The consideration is for the entire country.
Aggregate demand represents the macroeconomic conditions of the country. In the long run, aggregate demand is the GDP of an economy. GDP is the total amount of goods and services produced in a country, while Aggregate demand is the demand for those goods and services.
.
Answer:
b. greater under absorption costing than variable costing.
Explanation:
The question is to calculate the closing value of inventory and based on the choices, we need to calculate based on both the Absorption Costing and the Variable Costing Methods.
1. Closing Inventory based on Variable Costing Method
Direct Material $40
Direct Labour $30
Variable Overhead $2
Fixed Overhead <u>$0 </u>(this method does not reecognise fixed cost
Totals (Unit cost of Production) $72
Based on this, the closing inventory is $72 x (8,000+50,000-55,000 units)
=$77 x 3,000= $216,000
2. Closing Inventory based on Absorption Costing Method
Direct Material $40
Direct Labour $30
Variable Overhead $2
Fixed Overhead <u>$5</u>
Totals (Unit cost of Production) $77
Based on this, the closing inventory is $77 x (8,000+50,000-55,000 units)
=$77 x 3,000= $231,000
Based on these calculations:
The Ending Inventory is higher/Greater under absorption costing than variable costing and the reason is that variable costing does not recognize fixed cost in determining the value of ending inventory.
Answer:
a. Having $200 today is equivalent to having 
= $208
b. Having $200 in one year is equivalent to having 
i.e $192 today.
c. $200 today would be preferred since $200 received one year hence will have lower present value i.e it would be equivalent to $192 received today.
d. The answer provided above in (c) did not take into consideration the requirement or need. It only considered time value of money. If money is required today, it will be availed today irrespective of the time value of money principle since needs override principles.
