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Ber [7]
3 years ago
5

Savings for You, a discount retail chain, is highly competitive. When entering a new market, Savings for You often cuts prices s

o deeply that it sells below costs, effectively pushing smaller companies with less purchasing power out of the market. Savings for You is most likely guilty of ________.predatory pricingmarket skimmingdeceptive pricingprice collusionprice fixing
Business
1 answer:
REY [17]3 years ago
7 0

Answer:

<u>Predatory pricing</u>

Explanation:

A "predator" refers to an animal who survives by "preying" on other animals.

Predatory pricing in a similar sense refers to that form of excessively low pricing which in a way consumes other firms by taking away their share of industry revenues. Such form of pricing is considered illegal and is against healthy competition.

Such pricing eliminates competitors from the market and gradually leads to emergence of a monopoly i.e supremacy of a single firm in the whole industry and thus considered an illegal practice.

In the given case, the retail chain can be alleged to have followed predatory pricing which is substantiated by the fact that it cuts it's prices excessively i.e even below cost , thereby forcing smaller companies to exit the industry.

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During Year 5, Tedd Co. became involved in a tax dispute with the IRS. At December 31, Year 5, Tedd's tax advisor believed that
kkurt [141]

Answer:

$400,000

Explanation:

Since at December 31, Year 5, Tedd's tax advisor believed that an unfavorable outcome was <u>probable</u>. And a <u>reasonable estimate </u>of additional taxes was $400,000 but could be as much as $600,000.

Although after the Year 5 financial statements were issued, Tedd received and accepted an IRS settlement offer of $450,000.

Tedd should have included an amount of $400,000 as accrued liability in its December 31, Year 5 balance sheet

The reason is that according to the International Financial Reporting Standards, a PROVISION must be made as long as the conditions below were obtainable at year end.

- Existing Condition (which in this case is the tax dispute with the IRS)

- Probable Cash Outflow (which Tedd's Tax adviser confirmed)

- Reliable Estimate of Outflow ( which the scenario stated ''A reasonable estimate of additional taxes was $400,000'')

Hence, such 'reasonable estimate is the appropriate amount for inclusion in the financial statements.

5 0
3 years ago
Trowel Corp. has outstanding accounts receivable totaling $13,000,000 as of December 31 and sales on credit during the year of $
maksim [4K]

Answer:

$756,000

Explanation:

Allowance for Bad Debts opening        ($24,000)

Allowance for Bad Debts Closing         $780,000

(13,000,000)*6%

Allowance Bad  Debt Expense for the year  $756,000

5 0
3 years ago
Cool Sky reports the following costing data on its product for its first year of operations. During this first year, the company
Monica [59]

Answer:

$91

Explanation:

Given the following information,

Direct materials per unit = $54

Direct labor per unit = $20

Variable overhead per unit = $6

Fixed overhead for the year = $462,000

For Absorption costing method, it includes all costs associated with production, including fixed and variable cost. The unit product cost is calculated using direct material, direct labor and total unitary manufacturing overhead.

Unitary cost = (Fixed overhead for the year / Units produced) + Direct materials per unit + Direct labor per unit + Variable overhead per unit

Unitary cost = ($462,000 / 42,000) + $54 + $20 + $6

Unitary cost = $11 + $54 + $20 + $6

Unitary cost = $91

Therefore, the product cost per unit is $91

5 0
3 years ago
During the year, a company recorded prepayments of expenses in asset accounts, and cash receipts of unearned revenues in liabili
bonufazy [111]

Answer:

(1) accrue salaries expense

Debit [e.] Salaries Expense

Credit [g.] Salaries Payable  

--------------------

(2) adjust the Unearned Services Revenue account to recognize earned revenue

Debit [a.] Unearned Services Revenue  

Credit [f.] Services Revenue  

--------------------

(3) record services revenue for which cash will be received the following period.  

Debit [b.] Accounts Receivable

credit [f.] Services Revenue

3 0
3 years ago
An earned value report shows: how much money has actually been spent so far on the project. slippages in performance measures fo
Fynjy0 [20]

An earned value report will likely show all of these measures.

8 0
3 years ago
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