Answer:
c. $36,070
Explanation:
contribution margin ratio is the ratio of the contribution to sales of an entity for a given period.
contribution margin ratio= contribution/sales
where contribution is the difference between sales and the variable cost
Given;
sales = $137,000
contribution margin ratio = 61% = 0.61
0.61 = contribution/$137,000
contribution = $137,000 × 0.61
= $83,570
Net operating income is the difference between the contribution and the fixed cost.
Fixed cost = $47,500
Net operating income = $83,570 - $47,500
= $36,070
Answer:
4,000 units
Explanation:
Given that
Sales volume = 60,000 units
Budgeted production = 54,000 units
Beginning finished goods = 10,000 units
The computation of units for ending finished goods inventory is computed below:-
Budgeted production = Ending finished goods + Sales volume - Beginning finished goods
54,000 = Ending finished goods + 60,000 - 10,000
54,000 = Ending finished goods + 50,000
= 4,000 units
Answer:
c. debit to Bad Debts Expense for $6,900.
Explanation:
Allowance for Doubtful Accounts $1,100 credit balance,
Estimated Un collectibles $8000 credit
Required Adjustment $ 6900 credit
The adjustment to record bad debts for the period will require a
c. debit to Bad Debts Expense for $6,900.
Bad Debt Expense $ 6900 Dr
Allowance for Doubtful Accounts $ 6900 Cr
Alternatively if the allowance account had a debit balance the entry would have been posted adding the two amounts.
Answer:
The shift from AD1 to AD2 represents the total change in aggregate demand. If government purchases increased by $50 billion, then the distance from point A to point B would be greater than $50 billion.
Explanation:
Basically, aggregate demand can suffer two types of movements: displacements or changes in the slope. We are assuming a straight slope, but we could well analyze the case of an aggregate demand that is not straight.
DISPLACEMENTS
They are produced by changes in autonomous consumption. Changes in autonomous consumption may be due to changes in:
- Income distribution
- Access to credit
- Expectations
- Population changes
- Changes in relative prices between goods that belong to autonomous consumption (some foods) and goods that do not belong to autonomous consumption
CHANGES IN THE PENDING
They are produced by changes in the marginal rate to be consumed. Changes in the marginal rate to be consumed may occur due to:
- Changes in the utility function: they can change the preference for savings.
- Changes in income distribution
- Changes in the interest rate
