<span>Your business can make a profit but still not have enough cash on hand if you don’t collect payment at the time of service. At one given time, you may not have enough cash to pay your bills or payroll, Collecting payment at the time of service will ensure that you have enough cash coming in when you need to pay cash out. </span>
The best example is hospitals. These days, insured <span>patients are no longer allowed to walk out of the hospital without paying because of high administrative costs and low collection rates.</span>
Answer:
Implicit costs are opportunity costs. They are the cost of the next best alternative that one could have taken from the one they took.
Explicit costs are normal accounting costs which represent the expenses involved in running a business.
a. The wages and utility bills that Charles pays. EXPLICIT COSTS.
These are normal accounting expenses so they are explicit costs.
b. The wholesale cost for the guitars that Charles pays the manufacturer. EXPLICIT COSTS.
Another cost of doing business so this is explicit as well.
c. The rental income Charles could receive if he chose to rent out his showroom. IMPLICIT COST.
By not renting out his showroom and using it instead, he is losing the rental income he could be making so this is an implicit cost.
d. The salary Charles could earn if he worked as a financial advisor. IMPLICIT COST.
Another income he could be making if he wasn't selling guitars. This make it an implicit cost.
The choices can be found elsewhere and as follows:
<span>a) Summit
b) Appogee
c) Peak
d) Maximoid
</span>
I believe the correct answer is option D. The point on the business cycle where real GDP reaches its highest level is known as the Maximoid. Hope this answers the question. Have a nice day.
Answer:
Deferred Tax Liability= $564,000
Explanation:
The question is to determine the deferred tax liability to recognize by Sunland Co. at the end of the year 2017.
Step 1 :
We determine what the Income tax expense is for the year
Income tax expense= Pretax financial income x Income Tax rate
Income tax expense= $1,410,000 x 0.30 = $423,000
Step 2:
Although we recognized receivables as well as instalmental sales for reporting purposes under the accrual method. However, these will be subject to tax when we decide to recognize it in the future.
As such Deferred tax liability = Future Tax Liability
Deferred Tax liability for Sunland Co= Instalmental Sales x Income tax expense
= $1,880,000 x 0.3= $564,000
