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Daniel [21]
3 years ago
12

When the company pays rent expense for the current month, what is the effect on the accounting equation for that company?

Business
1 answer:
GREYUIT [131]3 years ago
3 0

Answer:

decrease the stockholder equity and decrease in assets

Explanation:

As we know, the accounting equation is  

Total assets = Total liabilities + stockholder equity

In the given case,  

The rent is paid for the current month, so the journal entry would be

Rent expense A/c Dr XXXXX

    To Cash A/c XXXXX

(Being rent is paid)

So it decreases the stockholder equity as it includes the income and expenses part and it decreases in assets as it reduces the cash balance

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Oahu Industries' average total assets for the year are $4,000,000, its average total stockholders' equity for the year are $3,00
Mandarinka [93]

Answer:

20%

Explanation:

Return on assets is a profitability ratio that shows how much in net income a company is able to generate from its assets.

It is a financial measure that shows the net profit a company is able to generate per $1 invested in assets.

Mathematically,

Return on asset = net income/average total asset

= $800,000/$4,000,000

= 0.2

= 20%

This means that the company's management is a to generate a net income of 20 cents for every $1 invested in assets.

8 0
3 years ago
Danny "Dimes" Donahue is a neighborhood’s 9-year-old entrepreneur. His most recent venture is selling homemade brownies that he
Marina86 [1]

Answer:

A) PED = 1.1

B) demand is elastic

C) Danny's total revenue would decrease

Explanation:

we can calculate the price elasticity of demand using the formula:

PED = % change in quantity demanded / % change in price = [(300 - 250) / 250] / [(2.25 - 2.75) / 2.75] = (50 / 250) / (-0.5 / 2.75) = 0.2 / 0.18 = 1.1

since PED = 1.1, the demand is elastic

if the PED is the same when the price decreases from $2.25 to $1.75, total revenue will    :

when price = $2.25, total revenue = $2.25 x 300 = $675

when price = $1.75, total revenue = $1.75 x 373 = $652.75

*a 22.22% decrease in the price will cause a 24.44% increase (= 22.22% x 1.1) in the quantity demanded = 300 units + (300 x 24.44%) = 373.3 ≈ 373 units

5 0
3 years ago
Wiley incorporates his business as Wiley Wire Corporation in Texas. He and his group of shareholders intend to make a profit fro
ruslelena [56]

Answer:

d. a private corporation.

Explanation:

A private corporation is a limited company that is owned by a few numbers of shareholders.  The shares of a private corporation are not publicly traded in the securities exchanges, neither are they issued through an initial public offer.  Ownership of a private corporation is transferable but is restricted to the founders who, in most cases, are family members, close friends, or associates.

Wiley and the shareholders have a private corporation. Formation of a private corporation is through incorporation, as is the case of Wiley wire corporation. Private corporations are established with a profit motive. Ownership of Wiley wire corporation will be restricted to Wiley and the other shareholders.

4 0
3 years ago
If current trends continue, China may be the world's largest economy by 2030. In a concise and well-noted statement, discuss the
Blizzard [7]

Answer:

If by 2030 China became, as current data estimates, the world's largest economy, this would mean a series of global changes in macroeconomic matters: A) for the world trade system, China would become the main exporter given its huge population (estimated at 1.6 billion people) added to its economic capacity, which would flood the world markets with manufactured products in this country, increasing the fiscal surplus and employment for its inhabitants; furthermore, it would relegate many nations to being secondary producers; B) the monetary system would watch the emergence of the Renmimbi as a new reference currency, displacing the dollar and the euro from the center of the scene; C) Commodity prices would be determined according to the consumption and production needs of China, with which the products demanded in this country will have high value.

4 0
3 years ago
Jordan's Ice Creams is strategically located near a university. After realizing that most of its customers, who are mostly stude
olga2289 [7]

Answer:

D) Focused differentiation strategy.

Explanation:

A focus differentiation strategy is meant to satisfy very different and specific needs of their customers. It is not just about making a different product that customers may like, it is about making very specific products that appeal to specific clients.

Jordan's Ice Cream is offering hundreds of customized products, each customized product appealing to a small number of clients. In this case, making unique ice cream combinations is not that expensive, but usually this type of strategy works well in very luxurious products.

7 0
3 years ago
Read 2 more answers
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