Income commissions consult with repayment paid for creating a sale. they may be generally a percentage of the sale this is then introduced on pinnacle of one’s base profits.
Sales commissions are a incredible tool because they serve to align the incentives of each the enterprise and the employee. both the salesclerk and the commercial enterprise gain from generating sales. With income commissions, salespeople can benefit extra manipulate over how a good deal they earn and their efforts are tied to compensation.
For the sake of this newsletter and the ASC 606 law, we will be centered at the accrual foundation method. The accrual basis acknowledges the revenue when it's far billed and earned, regardless of whilst the cash is paid or acquired.
So, if your salesperson makes a sale nowadays, however handiest gets their commission check at some point of next month’s pay day, you will be recognising the revenue at the time of the sale this month.
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Answer:
(a) Dividends : Equity
(b) Interest receivable :Assets
(c) Issuance of preferred stock : Equity
(d) Prepaid insurance: Assets
(e) Amortization: Expenses
(f) Cost of goods sold: Expenses
(g) Accounts payable: Liabilities
(h) Cash: Assets
(i) Equipment: Assets
(j) Gain on sale of equipment: Revenues
Explanation:
The main elements of financial statements are: Assets, Liabilities, Equity
, Revenues and Expenses.
Assets are all the resources that the company has.
Liabilities are all the obligations that the company has.
Equity is the difference of subtracting the liabilities of the assets.
Revenue is the economic benefit that the company receives.
Expenses are the disbursements that the company makes.
Veichle is in operating condition
Answer: The options are given below:
A) harvest for cash flow.
B) divest for cash flow.
C) improve customer loyalty.
D) enter related new market segments.
E) enter unrelated new market segments.
The correct option is D.
Explanation: Delta Motors is in the business of making automobiles. Their market segment will include people who use vehicles.
Therefore, in developing an affordable electric car, Delta Motors will still be in the business of servicing their current market segment, which is, people who use vehicles.
This segment will be new, but still related to the business that Delta Motors is involved in, because they will still be producing cars.
However, if we assume that Delta Motors now want to go into the business of making planes, they will service a totally unrelated new market segment, because making planes and making cars are two entirely different kinds of business.
- Shut down, if the minimum possible average variable cost is $5
In the purely competitive market majority of the producers is price taker as there are many sellers of the same homogenous product. When in the situation of Marginal Cost (MC) of product at the current rate of production is equal to the market price. This shows that the firm isn’t in profit, it is selling at which they are producing. So, the Average Variable Cost AVC of product at this level indicates the shutdown of the firm production.
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