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3 years ago

Past costs that are not affected by new decisions are known as

Business

2 answers:

Evgen [1.6K]3 years ago

5 0

The answer is sunk cost .

<h2>Further explanation </h2>

Sunk costs are costs that are incurred and are not refundable. Before the issue, sunk costs are included in the opportunity costs section and are not relevant for future decision making. This term originates from the oil industry where the decision to stop or continue operating an oil well is made based on expected cash flow and not based on a lot of money spent on drilling it. This is usually referred to as embedded costs, previous year's costs, stranded costs, or sunk costs.

According to the dictionary, the sunk costs are costs incurred in the past that will not be affected by current decision making. In the accounting world, sunk costs are defined as costs that have been incurred and generally cannot be changed.

Sunk costs are related to fixed costs so to calculate sunk costs you can use the fixed cost formula, which is as follows:

<u>Fixed costs = sunk costs + fixed costs that can be avoided </u>

If seen from the formulation of fixed costs consisting of sunk costs and fixed costs that can be avoided. Fixed costs that can be avoided are fixed costs components that can be avoided, but sunk costs are components of fixed costs that cannot be avoided.

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Sunk cost brainly.com/question/7034592, brainly.com/question/13777436

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Class: High School

Subject: Business

Keywords: Past costs are not affected by new decisions.

salantis [7]3 years ago

4 0

<span>Past costs that are not affected by new decisions are known as sunk costs. Sunk costs do not need to be taken into account when making new decisions because the money associated with it was already lost and it can not be regained. This money is lost by businesses due to bad decisions, such as poor investments.</span>

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Yes indeed.

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Answer:

LLC liabilities are included as part of member's tax basis while S corporation liabilities are not.

Tax rules favors LLCs.

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LLC liabilities are included as part of a member's tax basis while S corporation liabilities are not included in an S corporation shareholder's tax basis other than loans from the shareholders.

This distinction is important because the amount of loss a member or shareholder may deduct is limited to his or her tax basis in either his or her LLC interest or shares. Thus in this particular regard Tax rules favors LLCs.

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3 years ago

The annual report for Malibu Beachwear reported the following transactions affecting stockholders’ equity:a. Purchased $350,100

cestrela7 [59]

Answer:

Malibu Beachwear

Indication of the effect (+ for increase, − for decrease, +/− for increase/decrease) of each of these transactions on total assets, liabilities, and stockholders’ equity:

a. Purchased $350,100 of common stock now held in treasury.

Assets (-$350,100) = Liabilities + Shareholders' Equity (-$350,100)

b. Declared cash dividends in the amount of $260,050.

Assets = Liabilities (+$260,050) + Shareholders' Equity (-$260,050)

c. Paid the dividends in (b).

Assets (-$260,050) = Liabilities (-$260,050) + Shareholders' Equity

d. Issued 101,000 new shares of $0.10 par value common shares for $2 per share.

Assets (+$202,000) = Liabilities + Shareholders' Equity (+$202,000)

e. Closed the Dividends account.

Assets = Liabilities + Shareholders' Equity

Explanation:

a. The purchase of common stock held in treasury implies that Malibu Beachwear bought its own shares from investors and paid cash. The recording of the transaction involves a reduction in Cash (Assets) and Shareholders' Equity with the creation of Treasury Stock Account. The treasury stock account is a contra account to the Common Stock account and the balance is deducted from the Shareholders' Equity in the balance sheet.

b. By declaring cash dividends, Malibu Beachwear is returning to its stockholders part of the assets that belong to them. This transaction reduces the Shareholders' Equity (Retained Earnings) and increases the liabilities with Dividends Payable in the sum of $260,050 respectively.

c. The payment of the cash dividend by Malibu reduces the Assets (Cash) and the Liabilities (Dividends Payable) in the sum of $260,050.

d. The issue of 101,000 new shares of $0.10 par value for $2 per share by Malibu Beachwear increases its Assets (Cash) with the sum of $202,000 (101,000 x $2) and the Shareholders' Equity (Common Stock with $10,100 and Additional Paid-in Capital- Common Stock with $191,900).

e. Closing the dividends account does not affect the accounting equation. Instead, it affects the Income Summary (Statement of Retained Earnings) to which the account is closed.

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4 years ago

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Answer:

a. automatic stabilizers.

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Discretionary fiscal policies can either be expansionary or contractionary

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Contractionary fiscal policies is when the government reduces the money supply in the economy either by reducing spending or increasing taxes

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