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miv72 [106K]
3 years ago
7

The cost constraint suggests that, even when the cost of providing accounting information exceeds its benefit, the financial acc

ounting information should always be provided. True or false?
Business
1 answer:
Alekssandra [29.7K]3 years ago
3 0

Answer:

False

Explanation:

The GAAP established that when the benefits of obtaining accounting information are lower than the costs of providing that information, the information should not be provided.

For example, sometimes there are very small differences in certain accounts that don't allow a balance sheet to be balanced. If the accounting error is very small, e.g. just a few hundred dollars, then it is not reasonable to have a whole audit team check all the financial statements again to determine what caused the error. An adjusting entry could be made to close the account balances.

Imagine you are an auditor that must check the physical inventory of a factory and some boxes containing supplies are misplaced. It might take you a whole day to count again all the supplies and materials, but is it worth it? If the supplies were really expensive, probably yes, but if they were cheap components, then probably no.

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Maria has a balance of $4,500 on her credit card with a 22% interest rate. How long will it take her balance to double?
Makovka662 [10]

The time required from simple interest on a principal of $4,500.00 at an interest rate of 22% per year is 4.55 years (about 4 years 7 months).

<h3>Simple Interest</h3>

Given Data

  • Principal =  $4,500
  • Interest = 22%
  • Final Amount = $4,500*2 = $9,000

Equation:

t = (1/r)(A/P - 1)

Calculation:

First, converting R percent to r a decimal

r = R/100 = 22%/100 = 0.22 per year,

then, solving our equation

t = (1/0.22)((9000/4500) - 1) = 4.55

t = 4.55 years

Learn more about Simple Interest Here:

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3 0
2 years ago
Henkes Corporation bases its predetermined overhead rate on the estimated labor-hours for the upcoming year. At the beginning of
nlexa [21]

Answer:

$17.80 per labor-hour

Explanation:

Predetermined overhead rate = Budgeted Fixed Overheads ÷ Budgeted Activity

                                                  = $961,200 ÷ 54,000 labor-hours

                                                  = $17.80 per labor-hour

Predetermined overhead rate for the recently completed year is $17.80 per labor-hour.

7 0
3 years ago
On January 15, Year 5, Rico Co. declared its annual cash dividend on common stock for the year ended January 31, Year 5. The div
11Alexandr11 [23.1K]

Answer:

January 15, Year 5.

Explanation:

The Rico should decrease retained earnings by the amount of the dividend is declaration date.

The declaration date refers to date the board of directors of a company makes a formal announcement of when the next dividend will be paid. The declaration is therefore also referred to as the announcement date.

On the declaration date, liability account known as dividend payable account is created and credited, while the retained earnings is debited or reduced by the amount of the dividend.

From the question, January 15, Year 5 is the announcement date and it is therefore the date Rico should decrease retained earnings by the amount of the dividend.

3 0
3 years ago
The process through which a product or service takes root initially in simple applications at the bottom of a market and then mo
cricket20 [7]

The process through which a product or service takes root initially in simple applications at the bottom of a market and then moves up, eventually displacing established companies, is referred to as <u>Disruptive Innovation</u>.

In a business idea, disruptive innovation is an innovation that creates a brand new market and price network or enters at the lowest of an existing market and in the end displaces established marketplace-leading companies, products, and alliances.

Disruptive innovation refers to using a generation that upsets a structure, instead of "disruptive technology", which refers back to the era itself. Amazon, launched as an online bookstall in the mid-Nineties, is an example of disruptive innovation.

Disruptive innovation is the manner by using which a smaller enterprise—normally with fewer sources—moves upmarket and demanding situations larger, hooked-up corporations.

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8 0
11 months ago
The crowding-out effect implies that restrictive fiscal policy will increase aggregate demand and employment. lead to a signific
vladimir1956 [14]

The crowding-out effect implies that restrictive fiscal policy will reduce real interest rates.

<u>Option: D</u>

<u>Explanation:</u>

The crowding out effect is the circumstances where greater interest rates consequences gives output of a decline in private investment expenditure so as to dampen the initial rise in overall investment expenditure. Authorities often embraces a restrictive fiscal-policy approach and raises spending to stimulate economic activity. This contributes to interest-rate rises. Higher interest rates have a impact on private investment choices. A high magnitude of the crowding-out impact can also result in lower economic revenue.

4 0
3 years ago
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