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shusha [124]
3 years ago
8

Momentous Occasions is a photography business that shoots videos at college parties. The freshman class pays​ $1,000 in advance

on March 3 to guarantee services for its party to be held on April 2. The sophomore class promises a minimum of​ $2,800 for filming its formal dance and actually pays cash of​ $4,100 on February 28 at the dance.
a. Considering the $1,000 paid by the freshman class, on what date was revenue earned? Did the earnings occur on the same date the cash was received?
b. Considering the $4,100 paid by the sophomore class, on what date was the revenue earned? Did the earnings occur on the same date cash received?
Business
1 answer:
Viefleur [7K]3 years ago
5 0

Answer:

a. Considering the $1,000 paid by the freshman class,

Revenue earned on April 2

Did the earnings occur on the same date the cash was received No

b. Considering the $4,100 paid by the sophomore class,

Revenue earned on April 2

Did the earnings occur on the same date the cash was received No

Explanation:

a. Considering the $1,000 paid by the freshman class, on what date was revenue earned? Did the earnings occur on the same date the cash was received?

Revenue According to IFRS 15 is earned when earnings occur on the same date the cash was received when Momentous Occasions (the entity) transferres goods or services to the customer ( freshman class)

Thus $1,000 paid by the freshman class on March 3 is a Deferred Revenue. Earnings did not occur on the same date the cash was received.

Revenue occured when  Momentous Occasions (the entity) transferred goods or services to freashman class on April 2

b. Considering the $4,100 paid by the sophomore class, on what date was the revenue earned? Did the earnings occur on the same date cash received?

Revenue According to IFRS 15 is earned when earnings occur on the same date the cash was received when Momentous Occasions (the entity) transferres goods or services to the customer ( freshman class)

Revenue occured when  Momentous Occasions (the entity) transferred goods or services to freashman class on April 2

The $4,100 paid by the sophomore class on February 28 is payment for services rendered by  Momentous Occasions on  party held on April 2.

Thus Earnings did not occur on the same date the cash was received.

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Answer:

C. <u>Post purchase</u><u> </u><u>behavior</u>

Explanation:

Whenever a consumer buys a product, he/she undergoes various stages between the creation of need/want and the ultimate purchase decision.

5 stages have been stated under Consumer buying decision, namely,

  1. Need recognition : the foremost stage wherein a need or desire arises.
  2. Information search: Here, the consumer searches for information w.r.t how the need or want can be satisfied.
  3. Evaluation of alternatives: The stage wherein a consumer weighs pros and cons of all available alternatives which can satisfy the need.
  4. Purchase: The stage wherein a consumer finally purchases a product.
  5. Post purchase behavior : Here, the consumer evaluates his purchase and reviews his purchase decision.

In the given case, the customer already bought both the wines. Her opinion regarding superiority of quality and taste between the two, represents her post buying stage of purchase decision and her review of the viability of purchase decision.

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3 years ago
BPS reported the following data for its first year of operations: Sales Revenue $8,000 Cost of Goods Available for Sale 6,200 Op
Fittoniya [83]

Answer:

D. $952

Explanation:

The computation of the net income in the case when the LIFO is elected

Particulars AMount

Net sales    $7,232   ($8,000 - $640 - $128)

less : cost of goods sold ($6,200 - $820) $5,380

Gross Profit $1,852

Less: Operating Expenses   $900

Income before taxes $952

less: Income tax $0

Net income $952

Hence, the net income is $952

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3 years ago
An aging of Lily Company’s accounts receivable as of December 31 revealed the following. Amount % Uncollectible Current $20,000
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Answer:

What is BAD DEBT EXPENSE for THIS year?

4000

Explanation:

Aging    

Current          20000 2% 400

1-30                  50000 4% 2000

31-60         30000 7% 2100

Over 60         10000 25% 2500

   

                            7000

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Expense                    4000

4 0
3 years ago
1) Why might investors prefer floating rate notes over a fixed rate bond?
sladkih [1.3K]

Answer:

These questions are incomplete since the article relating to Hologen company is not attached. However, I would answer them this way.

Explanation:

1) A floating rate bond has a shorter duration; almost zero and it has lower sensitivity to interest rates compared to a fixed rate bond.This means that the former has a lower interest rate risk. Investors tend to demand floating rate bonds when they expect future interest rates to rise because their prices would be close to their par values as their interest rates would also increase. On the other hand, fixed bond's interest rates are inversely related to their prices.

2)

For an issuing company, borrowing money floating rates terms could be riskier for cashflow management purposes . Every time interest rates increases, it means that the company would pay higher interests to lenders which could hurt its profitability. The fluctuations could also negatively affect future financial planning unlike issuing fixed rate bonds whose coupon payments are constant hence decreasing the volatility of earnings.

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Cash Discount Calculations On June 1, Meadow Company sold merchandise with a list price of $40,000. For each of the sales terms
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Answer:

    Credit Terms     Date Paid     Amount received

1       2/10,n/30         June 8            $39,200

2      1/10, n/30         June 15           $40,000

3      1/15, n/30         June 14           $39,600

4              n/30        June 28           $40,000

Explanation:

Sales are made on June 1 with list price $40,000

1.

June 8

The receipt is within the discount period of 10 days, so the amount received will be net of 2% discount as follow

Amount Received = $40,000 x ( 1 - 2%) = $39,200

2.

June 15

The receipt is after the discount period of 10 days, so the full amount will be received as follow

Amount Received = $40,000

3.

June 14

The receipt is within the discount period of 15 days, so the amount received will be net of 1% discount as follow

Amount Received = $40,000 x ( 1 - 1%) = $39,600

4.

June 28

There is no discount offered in this term and credit period of 30 days is given. The cash receipt is within the credit period, So the full amount will be received as follow

Amount Received = $40,000

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