Answer:
BAIT PRICING
Explanation:
This is a pricing decision act on a customer to pick a product higher in price or new model when compared to the advert he/she saw. It is a deceptive marketing strategy and it is misleading.
Answer:
a. Best deal is 30 end-of-year payments of $5.6 million
b. Best deal is 10 end-of-year payments of $9.5 million
c. Best deal is lump sum today of $62 million
Explanation:
Please see attachment for workings.
d. As the interest rate increases, the duration of value shortens. That is as the interest rate increases, the best choose based on their payment duration reduces
Answer:
$3,553
Explanation:
Credit losses = Net credit sales × Historical percentage of credit losses
= $131,750 × 3%
= $3,953
Allowance for doubtful account has a credit balance of $400
The estimated bad debt expense can therefore be calculated as:
Bad debt expense = Credit losses - Allowance for doubtful accounts credit balance
= $3,953 - $400
= $3,553
Hence, the estimated bad debt expense using the percentage of credit sales method is $3,553
I believe the answer is B