Answer:
Tariffs and import quotas generally reduce economic welfare.
Explanation:
The vast majority of economists (over 90% according to the University of Chicago) agree that tariffs and import quotas generally reduce economic welfare. This is perhaps the normative statement in which economists agree the most.
The reason why is because tariffs and import quotas only benefit a small fraction of domestic producers, to the dismay of a larger number of consumers who end up having to pay higher prices for consumer goods.
Answer:
Alpha
The effects on assets, liabilities, and net income are as follows:
Assets are understated by $500
Liabilities are understated by $700
Net income is overstated by $200
Explanation:
a) Data and Calculations:
Interest earned from a note receivable = $500
Interest incurred from a note payable = $700
Failure to record these has the following effects:
Assets are understated by $500 (< $500)
Liabilities are understated by $700 (< $700)
Net income is overstated by $200
b) Adjusting Journal Entries (AJEs) ensure that the accounts are up-to-date in accordance with the accrual concept of financial accounting. The accrual concept requires that transactions affecting a financial period must be reported in the affected period. This implies that expenses incurred must be recognized in the period they are incurred and not when cash is paid. Similarly, revenue earned must be recognized in the period they are earned and not when cash is received.
Sabrina Company recorded an adjusting entry for salaries owed to employees at the end of the year. As a result of this entry, Sabrina Company's equity decreases and liabilities increase.
<h3>What is equity?</h3>
Equity in finance refers to ownership of assets that may be accompanied with debts or other liabilities. Liabilities are subtracted from asset value to calculate equity for accounting reasons.
<h3>What is liabilities?</h3>
A liability is an obligation that a person or business has, typically financial in nature. Over time, liabilities are resolved by the transmission of economic advantages like cash, products, or services.
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Answer:
Effect on income= $11,140 increase
Explanation:
Giving the following information:
Contribution margin $126
The marketing manager believes that a $6,500 increase in the monthly advertising budget would result in a 140 unit increase in monthly sales.
<u>To calculate the effect on income, we need to use the following formula:</u>
Effect on income= total contribution margin increase - fixed costs increase
Effect on income= 140*126 - 6,500
Effect on income= $11,140 increase
Answer:
annual interest expense $ 14,000
interest expense per semiannual payment: $ 7,000
for a total of $ 14,000
Explanation:
The bonds were issued at face value. Thus, the interest expense will match the cash payment of the bond.
annual interest:
principal x rate x time
200,000 x 7% = 14,000
semiannual interest
principal x rate x time
200,000 x 7% x 1/2 (half-year) = 7,000
<u></u>
<u>Note:</u>
We must express rate and time under the same metric. As the 7% rate is annual we multiply by 1/2 (a half) as there are 2 payment per year.
