Answer:
It is more profitable to continue processing.
Explanation:
Giving the following information:
The number of units= 1,250
It can be sold now for $67,500 to another manufacturer.
Alternatively, Holmes can process the units further at an incremental cost of $250 per unit. If Holmes processes further, the units can be sold for $375 each.
<u>The $50,000 is a sunk cost, meaning that it has already happened. It shouldn't be taken into account.</u>
Sell as it is:
Income= $67,500
Continue production:
Income= 1,250*(375 - 250)= $156,250
It is more profitable to continue processing.
When a company has a monopoly on a product, there is no other competition so that producer can price the product however high they want. When there is competition, the product must be priced appropriately or the consumer will go to another option. Additionally, monopolies can result is a lesser quality product.
Answer:
Exxon Mobil and Shell
Explanation:
-Both operate in the the same market, oil and gas, as BP.
-Both will benefit from BP's reduced expansion plan thereby increasing there market share in most of the strategic markets.
-BP will be left behind competition in the ever shrinking pie due to its reduced aggression.
Answer:
The correct answer is letter "C": The adjusting entry for deferred revenues increases revenues and decreases liabilities
Explanation:
Deferred Revenue is accrued payments that a corporation collects for goods or services that it has not yet produced or dispatched. Another term for deferred revenue is unearned revenue. Whereas normal payments for goods or services are recorded as revenue on the company's Income Statement, deferred revenue is recorded as a liability until the product is shipped.
For accounting purposes, <em>the adjusting entry for the deferred revenue by increasing an asset account (cash) with a debit and by increasing a liability account (unearned revenue) with a credit.</em>
Answer:
$38,000 Dividend
Explanation:
Based on the information given the tax treatment of the redemption to Marcie will be $38,000 dividend reason been that her husband shares was been attributed to her, and Since she owns 60 shares her remaining 10 shares including that of her husband 50 shares of Chestnut's will be 110 shares calculated as 150 shares - 40 shares outstanding.
Therefore when we look at this 60 shares/110 shares is greater than 50% which means that Marcie fails the 50% test which makes the redemption to be treated as a dividend.
Hence, the tax treatment of the basis of the shares redeemed will be $38,000 Dividend.
