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3 years ago

Which of the following statements is true about marginal revenue?

Business

1 answer:

shutvik [7]3 years ago

5 0

Answer: Option B

Explanation: Marginal revenue is the additional revenue from selling one more unit.

A. Marginal revenue equals zero means there is no additional revenue from selling one more unit, the demand could be positive.

B. Negative marginal revenue shows that the revenue earned from selling additional unit is less than the additional unit sold before.

C. Positive marginal revenue shows that the revenue earned from selling additional unit is more than the additional unit sold before.

D. Marginal revenue increases when price and quantity both increases.

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On January 1, 2019, Commercial Equipment Sales issued $ 29 comma 000 in bonds for $ 21 comma 700. These are sixminusyear bonds

maxonik [38]

Answer:

$2,058.33

Explanation:

bond's face value = $29,000

bond's market value = $21,700

interest rate = 10%

n = 6 x 2 coupons = 12

discount on bonds payable = $29,000 - $21,700 = $7,300

discount amortized per coupon payment = $7,300 / 12 = $608.33

total interest expense = ($29,000 x 10% x 1/2) + $608.33 = $1,450 + $608.33 = $2,058.33

the journal entry to record the coupon payment in June 30,2019:

Dr Interest expense 2,058.33

Cr Cash 1,450

Cr Discount on bonds payable 608.33

8 0

3 years ago

The Bradford Company issued 12% bonds, dated January 1, with a face amount of $87 million on January 1, 2021. The bonds mature o

kakasveta [241]

Answer:

1. $77,783,220

2. Jan-21

Dr Cash $ $77,783,220

Dr Discount On Bond $9,216,780

Cr Bond Payable $ $87,000,000

Explanation:

1. Calculation to Determine the price of the bonds at January 1, 2021.

First step is to calculate the Present Value Of Annual Interest

a Semi-annual Interest Amount $5,220,000

($87,000,000*12%/2)

b PV Annuity Factor for (20 Years,14%/2=7%) 10.5940

c Present Value Of Annual Interest (a*b) $ $55,300,680

($5,220,000*10.5940)

Second step is to calculate Present Value Of Redemption Amount

a Redemption Value $ $87,000,000

b PV Factor Of (20 Years,7%) 0.25842

c Present Value Of Redemption Amount (a*b) $ $22,482,540

($87,000,000*0.25842 )

Now let Determine the price of the bonds at January 1, 2021.

Intrinsic Value ( Price ) Of The Bond = ($55,300,680+$22,482,540)

Intrinsic Value ( Price ) Of The Bond =$77,783,220

Therefore the price of the bonds at January 1, 2021 is $77,783,220

2. Preparation of the journal entries to record their issuance by The Bradford Company on January 1, 2021,

Jan-21

Dr Cash $ $77,783,220

Dr Discount On Bond $9,216,780

($87,000,000-$77,783,220)

Cr Bond Payable $ $87,000,000

(Being to record issuance of bond)

3. Preparation of the journal entries to record their issuance by The Bradford Company on ion June 30, 2021

Jun-30

Dr Interest expenses $ 53,82,240

Discount On Bond payable $ 2,22,240

Cash $5,220,000

4.Preparation of the journal entries to record their issuance by The Bradford Company on

December 31, 2021

Dec-31 Interest expenses $ 53,97,797

Discount On Bond payable $ 2,37,797

Cash $5,220,000

( to record interest payment)

6 0

3 years ago

A subject property has a swimming pool (worth $5,000) and a three-car garage (worth $4,500). Comp property A has a pool only and

AnnyKZ [126]

Answer and Explanation:

The calculation of the adjusted price that could use for these two comps in a CMA is given below:

For Comp property A, the value of the garage should be

= $452,500 + $4,500

= $457,000

And, for comp property B, the value of the pool should be

= $446,000 + $5,000

= $451,000

In this way, it should be considered

4 0

3 years ago

Lindsey Company uses activity-based costing. The company has two products: A and B. The annual production and sales of Product A

natita [175]

Answer:

Results are below.

Explanation:

First, we need to calculate the activities rate:

Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base

Activity 1= 24,000 / 1,000= $24 per activity unit

Activity 2= 36,900 / 900= $41 per activity unit

Activity 3= 63,000 / 1,800= $35 per activity unit

Now, we can allocate costs to product A:

Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base

Activity 1= 24*200= $4,800

Activity 2= 41*750= $30,750

Activity 3= 35*1,000= $35,000

Total allocated costs= $70,550

Finally, the unitary cost:

Unitary cost= 70,550 / 5,000= $14.11

3 0

3 years ago

A cup of Starbucks coffee is just as good as a cup of Dunkin Donuts coffee for me (assuming equal sized cups.) The price of coff

Oxana [17]

Answer:

TRUE

Explanation:

It is given that both Starbucks coffee as well as Dunkin Donuts coffee are both perfect for me. They taste same and the quality of the coffee in both are same. The price of Starbucks coffee is more than the coffee in Dunkin Donuts. As a customer I would prefer the lower cost item i.e. the Dunkin Donuts coffee.

After the pandemic, the price of the Starbucks coffee have increased. But my utility of purchasing coffee from Dunkin Donuts is not changed as the price of the Dunkin Donuts coffee is still the lowest between the two. So I will continue buying coffee from Dunkin Donuts like before. Thus my utility remains unchanged.

4 0

2 years ago