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Usimov [2.4K]
3 years ago
12

On June​ 1, Addison Company purchased $ 10,000 of inventory on account from Garrison Company. Garrison offers a 4​% discount if

payment is received within 15 days. Addison records the purchase using the gross method and the perpetual inventory system. The journal entry on June 1 by Addison Company includes​:
a. a debit to Inventory for $9,600
b. a credit to Cash for $10,000
c. a debit to Inventory for $10,000
d. a credit to Accounts Payable for $9,600
Business
1 answer:
IRINA_888 [86]3 years ago
4 0

Answer:

c. a debit to Inventory for $10,000

Explanation:

Whenever goods are purchased on a discount to be received on payment basis, the inventory is first recorded at cost.

Also as per the general rule, discount is a kind of income, and incomes are recorded only when earned, therefore, the cost of inventory shall be reduced by 4% only when the payment is made, therefore the inventory on the date of purchase shall be recorded at $10,000 only and not for $9,600.

Thus, correct option is c

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what was one argument made for the construction of the panama canal? responses it would result in lower tariffs on foreign goods
Aliun [14]

Based on a historical perspective the one argument made for the construction of the Panama Canal is that "<u>it would allow ships to move swiftly from the Atlantic and the pacific in the event of a war."</u>

<h3>The Construction of Panama Canal.</h3>

The construction of the Panama canal was done in 1914 and covers about 82 km of waterway in Panama that connects the Atlantic Ocean with the Pacific Ocean and splits up North and South America.

The Panama Canal construction was essential for the political economy of the United States it cuts across the Isthmus of Panama which serves as a conduit for maritime trade.

There are various reasons or arguments for the construction of the Panama canal.

<h3>The reasons for building the Panama canal are</h3>
  • It would prevent warfare among competing countries
  • It would lessen the distance, cost, and time it took for ships to carry cargo between the Atlantic and the Pacific Oceans
  • It would eliminate the danger of earthquakes in Nicaragua.

Hence, in this case, it is concluded that the correct answer is "<u>it would allow ships to move swiftly from the Atlantic and the pacific in the event of a war."</u>

Learn more about Panama Canal here: brainly.com/question/26573102

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4 0
1 year ago
Orwell Building Supplies' last dividend was $1.75. Its dividend growth rate is expected to be constant at 25% for 2 years, after
EleoNora [17]

Answer:

Best estimate of the current stock price= $42.64

Explanation:

Price of the stock today = \frac{D1}{(1+ke)^1}+\frac{D2}{(1+ke)^2}+\frac{P2}{(1+ke)^2}.

where P2 = \frac{D3}{ke-g}

D0=$1.75

D1=$1.75(1.25)

D2=$1.75(1.25)(1.25)

D3=$1.75(1.25)(1.25)(1.06)

Price of the stock today = \frac{1.75(1.25)}{(1+0.12)^1}+\frac{1.75(1.25)(1.25)}{(1+0.12)^2}+\frac{1.75(1.25)(1.25)(1.06)}{(0.12-0.06)(1+0.12)^2}. = $42.64

8 0
3 years ago
A company pursuing vertical integration can gain market power over its competitors through all of the following EXCEPT: a. avoid
Helen [10]

Answer:

B. Improved adjustment to technological changes.

Explanation:

Vertical Integration: It is a strategy to gain competitive advantage by taking complete control over a few stages of production or distribution. The company implements vertical integration to reduce the cost of production, reduce dependence on others, improve the quality of the product, etc.

In the given case, the company pursuing vertical integration can gain market power over its competitors through improved quality, reduction in cost, and reduction in operation cost, however, it does not improve adjustment to technological changes.

3 0
3 years ago
XYZ Company makes 400 widgets. The variable costs are $35.60 per unit and fixed costs are $30.00 per unit; however, $21.40 in fi
Anuta_ua [19.1K]

Answer:

increase in income  of $80

Explanation:

Prepare an Analysis of Costs and Savings if the Company buys from Outside Supplier.

Note : The  fixed costs per unit at are unavoidable are irrelevant and disregarded in this decision.

<u>Analysis of Costs and Savings</u>

Purchase Price (400 widgets × $44.00)  =    ($17,600)

Savings :

Variable Costs ($35.60 × 400 widgets)   =     $14,240

Fixed Cost ( $8.60 × 400 widgets)           =      $3,440

Net Income effect                                      =           $80

Conclusion :

The effect on net income if the company instead buys the widgets is an increase in  income  of $80

3 0
3 years ago
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