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4 years ago

Indicate whether you agree or disagree with the following statements. Briefly explain your answers.

Business

1 answer:

PtichkaEL [24]4 years ago

3 0

Answer: Incorrect; Correct; Incorrect

Explanation:

A. This is incorrect. Increasing returns to scale refers to the situation whereby the long-run average cost curve of a firm slopes downward and this leads to an increase in the scale of production of the firm and this also leads to lower average costs.

B. This is correct. The constant returns to scale refers is a situation whereby an increase in the firm's scale of production will have no impact on the costs per unit produced.

C. This is incorrect. Decreasing returns to scale is a situation that occurs when the long-run average cost curve of a firm slopes upward and this results into a situation whereby an increase in the scale of production of the firm will lead to higher average costs.

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Gelneren [198K]

It’s D, marketing research

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3 years ago

[The following information applies to the questions displayed below.]

Sunny_sXe [5.5K]

Answer:

Since the requirements are missing, I believe that you need the adjusting entries:

1. Depreciation on the equipment for the month of January is calculated using the straight-line method.

Dr Depreciation expense 375 ($18,000/4 x 1/12)

Cr Accumulated depreciation, equipment 375

2. At the end of January, $3,500 of accounts receivable are past due, and the company estimates that 50% of these accounts will not be collected. Of the remaining accounts receivable, the company estimates that 2% will not be collected. The note receivable of $18,000 is considered fully collectible and therefore is not included in the estimate of uncollectible accounts.

Dr Bad debt expense 6,250

Cr Allowance for doubtful accounts 6,250

3. Accrued interest revenue on notes receivable for January.

Dr Interest receivable 75 ($18,000 x 5% x 1/12)

Cr Interest revenue 75

4. Unpaid salaries at the end of January are $33,100.

Dr Salaries expense 33,100

Cr Salaries payable 33,100

5. Accrued income taxes at the end of January are $9,500

Dr Income tax expense 9,500

Cr Income tax payable 9,500

5 0

3 years ago

The Murdock Corporation reported the following balance sheet data for 2018 and 2017: 2018 2017 Cash $91,805 $30,755 Available-fo

worty [1.4K]

Answer:

net income $63,000

+ depreciation $51,700

- gain on sale of equipment ($1,650)

change in current assets:

- increase in accounts receivables ($13,050)

- increase in inventory ($21,300)

+ decrease in prepaid insurance $630

change in current liabilities:

- decrease in accounts payable ($73,630)

- decrease in salaries payable ($5,800)

- decrease in notes payable ($51,300)

<u>net cash provided by operating activities ($51,400)</u>

Explanation:

2018 2017

Available-for-sale debt securities (not cash equivalents) 22,000 98,000 INVESTING ACTIVITY

Accounts receivable 93,000 79,950 = -13,050

Inventory 178,000 156,700 = -21,300

Prepaid insurance 2,670 3,300 = 630

Land, buildings, and equipment 1,276,000 1,138,000, INVESTING ACTIVITY

Accumulated depreciation 623,000 585,000 = 38,000 + 13,700 = 51,700

Accounts payable $88,040 $161,670 = -73,630

Salaries payable 25,200 31,000 = -5,800

Notes payable (current) 36,700 88,000 = -51,300

Bonds payable 213,000 0 FINANCING ACTIVITY

2) Equipment costing $20,000 with a book value of $6,300 was sold for $7,950 = 13,700 added to accumulated depreciation, -1,650 gain on sale

3 0

3 years ago

EMC Corporation has never paid a dividend. Its current free cash flow of $490,000 is expected to grow at a constant rate of 4.4%

disa [49]

Answer:

$5,697,674

Explanation:

Dividend Valuation method is used to value the operations of a company based on the dividend paid, its growth rate and rate of return/WACC. The price is calculated by calculating present value of future dividend payment.

Free cash flow is the residual cash flow of operation after paying the capital expenditure from net income of the company. It represent the cash from the operations.

Formula to calculate the value of operation

Value of Operations = FCF / ( WACC - growth rate )

Value of Operations = $490,000 / ( 13% - 4.4% )

Value of Operations = $5,697,674

7 0

4 years ago

A difference between book income and tax income that __________ (increases / decreases) taxable income in the current year but w

LuckyWell [14K]

Answer:

Temporary difference

Explanation:

The reason is that the temporary difference is due to allowable and disallowable expenses and returns for some period which in later years equals to the allowable or disallowable incomes and expenses. This is all because of the temporary differences.

5 0

4 years ago