Answer:
The correct option is D
Explanation:
External cost is the form of an expense which occur while consuming or producing the goods and services that imposes the cost or expense ( with negative effect) on the third party.
If there are the external costs while consuming the good, then the social costs would be greater than the private cost.
So, the external cost is defined as the cost that is imposed without any compensation on someone other than the person who cause or incur it.
Answer:Yes, the Manager made an error.
Explanation:
Increasing the revenue of a firm depends on two factors which are price and effective demand. An increase in price without a fall in demand will increase revenue, an increase in demand without a fall in price will equally increase revenue.
However when manipulating price only in order to increase revenue care must be taken to ensure same or higher level of demand for an increase in price which lead to a fall in demand may boomerang for the firm.
E.g
Year. $ Price. Demand. Revenue$
1. 5. 100. 500
2. 6. 80. 480
The above illustrate an increase in price without a rise or maintaining the same level of demand leads fall in revenue.
Answer:
The amount of consolidated net income that will be assigned to the controlling interest for 2018 is $ 48,000.
Explanation:
In order to calculate consolidated net income profit and loss on intra group transactions are eliminated or not taken into account. So in order to calculate profit cost incurred by group is taken as cost of good sold and sales that is made to third party will be taken as revenue. Detail calculations are given below.
Revenue $ 100,000
COGS ($ 40,000) (50,000 *80%)
Profit $ 60,000-A
Consolidated net income controlling interest = A * 80% = $ 48,000
Answer:
Option D. Not enough information to answer this question.
Explanation:
There are number of factors the company considers before entering or exiting the market and some of these include Marginal cost or marginal revenue analysis, project analysis which considers the future cost and benefits by continuing the business, Porter five forces factors consideration before entering, Capabilities and resource analysis, etc.
So merely a price doesn't decides that we going to enter the market or we are leaving the market. Their are chances that we can control the cost of that the competitor starts selling the product at cost which will have harmful impact.
So the information provided to answer this question is not enough.
Answer:
Credit inventory 1000 and debit COGS 1000
Explanation:
19*500=9500 <price it is recorded at currently
The rule requires lower cost - market vs. price. Since market cost is lower, you have to find out how much the ending inventory balance should be
17*500=8500
9500-8500=1000
The inventory booked should be lowered, thus requiring credit entry of 1000. Since it is a merchandise loss, it is counted towards cost of goods sold expense, thus debit
