Answer:
continue producing 1000 units
Explanation:
A perfect competition is characterised by many buyers and sellers of homogeneous goods and services. Market prices are set by the forces of demand and supply. There are no barriers to entry or exit of firms into the industry.
In the long run, firms earn zero economic profit. If in the short run firms are earning economic profit, in the long run firms would enter into the industry. This would drive economic profit to zero.
Also, if in the short run, firms are earning economic loss, in the long run, firms would exit the industry until economic profit falls to zero.
Profit is maximised where price is equal to marginal cost
the firm already maximises profit / loss because price ($2.50) is equal to marginal cost ($2.50). So, the firm should continue production at 1000 units
Answer: When a company uses the allowance method of accounting for uncollectible receivables, the entry to reinstate a previously written off account would include: <u>"C. A debit to Allowance for Doubtful Accounts".</u>
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Explanation: Registration would be: Debit to "Allowance for Doubtful Accounts" and Credit to "Accounts Receivable".
Example:
--------------------------------------- . -----------------------------------
Allowance for Doubtful Accounts 100
Accounts Receivable 100
--------------------------------------- . ------------------------------------
Answer:
The present value of your prize at a discount rate of 8 percent is $277,777.78
Explanation:
In order to calculate the present value of your prize at a discount rate of 8 percent we would use the DDM to compute the present value today as follows:
As per ddm model value today = Expected earning next year / (required rate - growth rate)
expected cash flow after 1 year =$12,500
Growth = 3.50%
required rate =8%
Therefore, Value today =$12,500/(8%-3.5%)
Value today = $277,777.78
The present value of your prize at a discount rate of 8 percent is $277,777.78
Answer: The actual cost of materials was less than the standard cost
Explanation:
Net materials cost variance = Favorable materials price variance + Favorable materials quantity variance
= 380 + (-120 unfavorable)
= 380 - 120
= $260 favorable
<em>As the materials cost variance is favorable, it means that the actual cost of materials was less than what was budgeted for it or rather its standard cost. </em>
Answer:
=$172,000
Explanation:
Hall records:
The uncollectable account had a credit balance of $ 24,000.
A credit balance is a positive balance; there is money in the account.
Hall wrote off $ 96,000 in the year
new balance = $24,000- $ 96,000
=($ 72,000.00)
Allowance for doubtful accounts required $100,000.00
Amount of uncollectable expense for the year should be
Amount +(72,000)= 100,0000
Amount =100,000+72000
=$172,000