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Ksenya-84 [330]
3 years ago
9

P & G Auto Parts sells parts to AAA Car Repair during 2018. P&G offers rebates of 2% on purchases up to $60,000 and 3% o

n purchases above $60,000 if the customer’s purchases for the year exceed $200,000. In the past, AAA normally purchases $300,000 in parts during a calendar year. On March 25, 2018, AAA Car Repair purchased $74,000 of parts. The journal entry to record the purchase includes a:
a. debit to Accounts Receivable for $74,000.


b. debit to Accounts Receivable for $72,800.


c. credit to Sales Revenue for $72,380.


d. credit to Sales Revenue for $72,800.
Business
1 answer:
nirvana33 [79]3 years ago
5 0

Answer:

c. credit to Sales Revenue for $72,380.

Explanation:

Since AAA Car Repair's total purchases exceed $200,000 for the year, they are eligible for the 3% rebate on purchases above $60,000. Only the fraction of the purchase over $60,000 should get the 3% rebate, the first $60,000 get the 2% rate.

Therefore, the total sales amount recorded by P & G Auto Parts by selling $74,000 of parts to AAA is:

S=(1-0.02)*\$60 + (1-0.03)*(\$74-\$60)\\S=\$72.38

There should be a credit to Sales Revenue for $72,380.

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The best choice here is A) They give out the samples and free trials as a test to see how common it is for people to be interested in their product.
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3 years ago
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In a transaction between merchants, the additional proposed terms automatically become part of the contract unless
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6 0
3 years ago
Which of the following best represents the pricing behavior of firms in a monopolistically competitive industry?
allochka39001 [22]

Answer:

The correct answer is option B.

Explanation:

A monopolistic firm is characterized by a large number of buyers and sellers in the market producing differentiated products which are close substitutes, there are relatively easier entry and exit in the market.  

In the given question, Teen Angle Hardware is looking for a niche or a slightly differentiated product to sell to teenagers. But is able to earn only a normal profit because there is a large number of firms in the market. And new firms can enter the market in the long run. So, this firm is an example of a monopolistic firm.  

3 0
3 years ago
Two isolated nations, Alphaland and Betaton, are considering opening their borders to trade with each other. Both nations consum
Artist 52 [7]

Answer:

5 tons of salt for 1 ton of pepper

10 tons of salt for 1 ton of pepper

Explanation:

Alphaland's opportunity cost of producing one ton of pepper = 80 ÷ 5

                                                                            = 16 tons of salt

Betaton's opportunity cost of producing one ton of pepper = 3 ÷ 1

                                                                            = 3 tons of salt

Alphaland's opportunity cost of producing one ton of salt = 5 ÷ 80

                                                                            = 0.0625 tons of pepper

Betaton's opportunity cost of producing one ton of salt = 1 ÷ 3

                                                                            = 0.3333 tons of pepper

Therefore, Betaton has a comparative advantage in producing pepper because it has the lower opportunity cost of producing pepper as compared to Alphaland. On the other hand, Alphaland has a comparative advantage in producing salt because it has the lower opportunity cost of producing salt as compared to Betaton.

Hence, Betaton is specialized in the production of pepper and Alphaland is specialized in the production of salt.

Trade is beneficial for both the nations when Alphaland buys pepper at a price lower than the 16 tons of salt and Betaton sells pepper at a price greater than 3 tons of salt.

Trade ratios:

5 tons of salt for 1 ton of pepper

10 tons of salt for 1 ton of pepper

7 0
3 years ago
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