Answer & Explanation:
The fair value of our asset is $20000 and what we receive is a truck with $15000 market value and $5000 cash. So the transaction possesses commercial substance as the fair value and value received are same.
So assume if the transaction lacks the commercial substance (according to question) then the truck received must be recorded at fair value and must be offset against the truck which is exchanged for. The entry would be:
Dr Truck received @ Fair Value $15000
Cr Truck Sold $12000
Cr Profit on Disposal $8000
The above entry makes it clear that the entry to recognize the truck would be $15000. So the option D is correct.
Answer:
Explanation:
• Initially, As a result of the bond purchase, money supply will increase by $100000.
The reason for the increase in money supply by $100000 is because the federal reserve bought bond of $100000 from Riggie Rich. This is an expansionary policy which will lead to more money in supply.
• As a result of Rich's deposits, the bank will able to give $90000 more in additional loans.
The increase in the additional loans will be calculated by removing the reserve required ratio from the deposit.
= $100000 - (10% × $100000)
= $100000 - $10000
= $90000
• As a result of the purchase by the Federal reserve, the maximum increase in quantity of checkable deposits which could result throughtout the entire banking system will be $1000000.
The increase in checkable deposits will be the change in reserve multiplied by 1/RRR. This will be:
= $100000 x 1/10%
= $100000 × 1/0.1
= $100000 x 10
= $1000000
Answer:
b buyers and sellers determine resource allocation.
Explanation:
The market is regulated by the interaction between Sellers and Buyers. However, in a Command economy the market is regulated by the government policies.
<u>Explicit</u> costs are the monetary payments made for market-supplied inputs while <u>implicit</u> costs are non-monetary opportunity costs.
Market, a means by using which the alternate of goods and offerings takes location as a result of shoppers and dealers being in touch with one another, both without delay or through mediating dealers or establishments.
A market is an area in which consumers and sellers can meet to facilitate the alternate or transaction of goods and offerings. Markets can be physical like a retail outlet, or digital like an e-store. Different examples encompass illegal markets, auction markets, and financial markets.
The definition of a market is an area in which you go to buy matters or a call for a specific item. An example of a marketplace is a grocery save or a farmer's marketplace where stands are set up and fruits and vegetables are sold.
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As prosperity and economic development rise, individualism increases as well.
Individualism refers to the freedom of someones actions. If the economy is doing well and someone has more money, they are more likely to spend their money freely. The person has moral worth as an individual.
