Answer:
a. When the equipment is sold.
Explanation:
As we know that
When someone sells or purchase a product, the services are attached to the product which is passed from the buyer to the seller that can be in terms of warranty i.e after-sales services, etc
So according to the given situation, the estimation of the warranty cost is $25 per time sold so the warranty cost should be recognized when the equipment is sold as it is attached to the product
Answer:
=$5,533.33
Explanation:
James took four weeks of paid leave. It means earned his salary but missed out on overtime earnings.
His hourly pay is $25; overtime pay will be $50 per hour
Monthly qualifying income is similar to average monthly income. The term is used mostly in credit assessments.
regular monthly income for James equal to yearly pay divide by 12 months
=$52,000/12
=4,333.333
Overpay income
6 hours per week x 4 weeks per month x $50 per hour
=6 x 4 x $50
=24 x $50
=$1200
Monthly qualifying income = 4,333.33 + 1200.00
=$5,533.33
Answer:
Diminishing returns
Explanation:
A firm producing widgets (term for a generic good) has two factors of production.
The factory and labour. The capacity of the factory is fixed, and the marginal cost
(MC) of labour is the same (i.e. each new worker will cost the same).
There are two stages to how MC is affected.
1. Increasing returns (MC goes down)
As output begins to increase, the large manufacturing processes/equipment still not fully utilised means and the additional labour can be productive as they can always use the equipment to its full potential due to which the MC is relatively low.
2. Constant returns (MC goes sideward)
At this point, labour is producing its optimal output per unit. The marginal cost is therefore at its lowest.
3. Diminishing returns (MC goes up)
The more labour that is employed, the less marginal output it is able to produce. This could be a result of too many people to efficiently operate/ rotate use of machinery. The cost increases more and more to generate an extra unit of output, because of labour exhibiting diminishing returns in the short run.
In this question, the 10th worker has added 22 units which is 3 units less than the number of units added by the 9th worker, thus the company is producing less marginal output for each worker. so based on the above discussion it can be concluded that the company has Diminishing returns.
Depletion is used as a deduction from the gross income
So if we're wrong in putting the depletion data, it will be very likely that the income statement for the following period would be overstated
