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3 years ago

Why do government regulations lead to higher prices for consumers?

1 answer:

6 0

Government regulations mandate production or testing requirements to ensure the quality and safety of products. This typically means specialized equipment is needed to produce the product, more employees are needed to perform quality control tests, and possibly higher quality raw materials must be used. The cost of producing the product increases with the higher quality materials, new equipment acquisition, and additional paid employee time. These added production costs are then passed on to the consumer in the final price of the product.

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Prince Company owns 104,000 of the 130,000 shares outstanding of Serf Corporation. Serf Corporation sold equipment to Prince Com

Mnenie [13.5K]

Answer:

Journal 1

At the beginning of the year

Debit : Equipment $380,000

Credit : Retained Earnings ($380,000 - $95,000) $285,000

Credit ; Accumulated Depreciation $95,000

Journal 2

During the year :

Debit : Depreciation $95,000

Credit : Accumulated depreciation $95,000

Explanation:

The sale of equipment to Prince Company is an intragroup transaction and must be eliminated from Prince Company Consolidated Financial Statements as follows :

Carrying Amount before sale :

Carrying Amount = Cost - Accumulated Depreciation

= $1,280,000 - ($1,280,000 ÷ 8)

= $1,120,000

Unrealized gain / loss =Selling Price - Carrying Amount

= $740,000 - $1,120,000

= $380,000 loss

Eliminate this loss on sale of equipment

2017

Unrealized depreciation = $380,000 ÷ 4

= $95,000

Eliminate this depreciation charge deferred at the beginning of 2018

2018

Unrealized depreciation = $380,000 ÷ 4

= $95,000

Eliminate this depreciation charge deferred during 2018

5 0

3 years ago

nnette Henri is paid an hourly wage of $8.90 for a 32-hour workweek of 4 days, 8 hours daily. For any work on the fifth day and

Elza [17]

Answer:431.75 dollars

Explanation:she gets 284.8 dollars for the 32 hours(32x 8.9) and for the extra 11 hours she gets 146.85( 8.9 x 1.5= 13.35 and 13.35 x 11) 146.85+ 284.8= 431.75

4 0

3 years ago

A given investment project will cost RM400,000. Incremental annual cash flows after taxes are expected to be RM80,000 per year f

erastova [34]

Answer:

Based on the profitability index method, the investment should not be accepted.

It does not produce enough cash flows to justify the investment.

Explanation:

The profitability index method measures the present value of benefits for by dividing the present value of benefits by the present of initial investments.

The present value of initial investment in this project remains RM400,000. The present value of incremental annual cash flows of RM80,000 after taxes for 5 years will be equal to:

RM80,000 * 3.668 = RM293,440

Then the next step is to divide the present value of benefits by the initial investment as follows:

RM293,440/RM400,000 = 0.7336 = 73.36%

The implication is that the present value of the benefits is less than the initial investment costs. The project should then be rejected.

6 0

3 years ago

Tuscany Company estimated the following costs at the beginning of a particular year: Overhead $5,340,000 Direct labor cost $890,

solmaris [256]

Answer: $300,000

Explanation:

As overhead is applied on the basis of direct labor cost, the overhead rate for the period is:

= Overhead / Direct labor cost * 100%

= 5,340,000 / 890,000 * 100%

= 600%

If direct labor cost is $50,000 then overhead applied will be:

= Direct labor cost * Overhead rate

= 50,000 * 600%

= $300,000

7 0

3 years ago

What is the best investment option for a person who wants to make a long term tax free investment

jenyasd209 [6]

Joint-stock company

6 0

3 years ago