On December 18, Intel receives $260,000 from a customer toward a cash sale of $2.6 million for computer chips to be completed on
January 23. The computer chips had a total production cost of $1.6 million. What journal entries should Intel record on December 18 and January 23? Assume Intel uses the perpetual inventory system.
1 answer:
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Answer:
c) 10% more peanut butter on the shelves
Explanation:
Since peanut butter has a negative income elasticity of demand (-0.5) with a decrease in income, there should be an increase in the demand. This is usually true for cheaper goods or goods with low added value. The change in demand (D) is represented as follows:
As a result, you should stock 10% more peanut butter on the shelves.
The answer is c).