What is gained by using the Circular Flow Diagram to illustrate GDP?

Midwest Fabricators Inc. is considering an investment in equipment that will replace direct labor. The equipment has a cost of $

Ne4ueva [31]

Answer:

Average rate of return = 14 %

Explanation:

Average rate of return = Annual average return/ Average Investment

Average investment =( Initial investment + scrap value)/2

Average investment = 138,000 + 12,000/2 =75,000

Average annual return = Savings in cost - energy cost - depreciation

Depreciation = (initial cost - scrap value)/2= (138,000 - 12,000)/2= 12600

Average annual return = 29,780-6,680-12600= 10500

Average rate of return = 10,500/75,000 × 100= 14 %

Average rate of return = 14 %

6 0

3 years ago

A company purchased $2,300 of merchandise on July 5 with terms 2/10, n/30. On July 7, it returned $450 worth of merchandise. On

Aleksandr [31]

Answer:

Dr Accounts payable 1850

Cr Merchandise inventory $37

Cr Cash $1813

Explanation:

Preparation of the journal entry to record the payment on July 12 Using the gross method,

JOURNAL ENTRY

Jul-12

Dr Accounts payable ($2300-450) 1850

Cr Merchandise inventory ($1850*2%) $37

Cr Cash $1813

($1850-$37)

(Being entry recorded for payment to supplier)

7 0

3 years ago

Creating value within business units can happen when a firm tries to find and acquire either poorly performing firms with unreal

Strike441 [17]

Answer:

Parenting.

Explanation:

The complexity of transitional business conditions creates a necessity for creating value through aggregation of various businesses in complex corporate enterprise, which provides it the character of a multi-business firm. Businesses may be defined as being regardless of the enterprise chooses to work as organizationally separate profit-responsible units. this can be primary done to create a fit between ways the business creation is been done.

6 0

3 years ago

When the firms in the industry are just able to cover their cost of production, economic profit is zero. Therefore, if demand fa

zheka24 [161]

Answer:

The correct answer is false.

Explanation:

A firm incurs both variable cost and fixed cost in the short run. If the firm is able to cover the variable cost in the short run it will continue operating. However, if it is not able to cover its variable cost it will stop operating.

So, if the demand falls such that total revenue is not able to cover total cost but the variable cost is being covered, the firm will not stop production.

In the long run, all the costs are variable. So when the revenue is not able to cover cost, the firms will stop operating.

6 0

3 years ago

Pamela, a 1/3 partner, has an adjusted basis of $100,000 for her partnership interest. If Pamela sells her entire partnership in

creativ13 [48]

Answer: Capital gain = $10,000 ; Ordinary income = $25,000

Explanation:

Here is the complete question:

The PLM Partnership balance sheet includes the following assets on December 31 of the current year:

Basis FMV

Cash $230,000 $230,000

Accounts receivable 0 75000

Land 70,000 100,000

Total $300,000 $405,000

Pamela, a 1/3 partner, has an adjusted basis of $100,000 for her partnership interest. If Pamela sells her entire partnership interest to Emma for $135,000 cash, how much capital gain and ordinary income must Pamela recognize from the sale?

The following can be calculated based on the question above:

Pamela's share of the unrealized receivables will be the ordinary income which will be the unrealized receivables of $75000 which is then multiplied by 1/3 which is the interest. This will be:

Ordinary income = 1/3 × $75,00

= $25,000

The capital gain will be the difference that occurs between total gain and ordinary income.

Total gain difference

= $135,000 - $100,000

= $35,000

Ordinary Income = $25,000

Capital gain = $35,000 - $25,000

= $10,000

5 0

3 years ago