Answer:
C) it does not change GDP
Explanation:
The selling of existing homes does not affect the GDP since they were built in previous years. Only the sale of newly built homes increase the GDP.
Only the services provided by real estate agents, appraisers, lawyers, etc. related to the sale of existing homes are included in the GDP.
Answer:
Felix Incorporated
Exchange of Preferred Stock for Land:
Journal Entries:
Debit Land $90,000
Credit Preferred Stock $81,250
Credit Additional Paid-in Capital - Preferred Stock $8,750
To record the issue of 1,250 of $65 par-value preferred stock for land with a fair price of $90,000.
Explanation:
Felix Incorporated will debit Land with the fair price of $90,000 and Credit the Preferred Stock account with $81,250 (1,250 x $65) at par-value. The difference between the fair price of land and the preferred stock at par-value is credited to additional paid-in capital account for preferred stock. Felix Incorporated cannot take into account the current market value of the stock at $75 in its accounting records. The current share price of $75 is for the benefit of investors, and can only serve as basis for Felix Incorporated to decide transactions with potential investors.
Answer: B. Shut down her business
Explanation:
Lydia has a decision to make. In this scenario she is making less her costs and so is suffering a loss. She must make a decision to either SHUT DOWN or KEEP GOING.
In this case however it would seem as though her only decision is to Shut Down.
Why?
The Shut Down Rule states that, “in the short run a firm should continue to operate if price exceeds average variable costs...". Her Average Variable costs here exceed the market price so Shutting Down is her best option.
If the price exceeded her Variable Costs at least, she could stay in the market a bit longer as the Fixed Costs have already been committed to. But with her Variable Costs more than the Market Price, SHUTTING DOWN is her best option.
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Answer:
C. includes a wide arrange of anticompetitive practices.
Explanation:
Answer: Internal auditor
Explanation: Internal auditor refers to the audit professionals in an organisation. The internal auditor ensures that the operations of the business are within the boundaries of laws and regulations made.
In the given case, Morris was evaluating the financial statements and detected that employees funds are not managed as per the regulations. He also reports the violation to his supervisors.
Hence we can conclude that Morris is an internal auditor.