Answer:
selling the defective gloves as they are results in a $3,000 higher gain
Explanation:
the manufacturing costs of the defective gloves should be considered a sunk cost since they cannot be recovered:
alternative 1, sell defective gloves = $18 x 1,000 = $18,000 gain
alternative 2, repair the gloves and sell them at normal price = ($40 - $25) x 1,000 = $15,000 gain
alternative 1 (selling the defective gloves as they are) results in a $3,000 higher gain
Answer: d. Ron has income on the transaction of $21,000
Explanation:
Ron’s stock received for services counts toward the 80% control test so the transfers are eligible for IRC § 351 exemption.
This means that the total income that Ron has as a result of this transaction is the $21,000 for services.
Ron's basis will therefore be;
= Cattle basis + Income from services rendered
= 6,000 + 21,000
= $27,000
Answer:
Scenario analysis
Explanation:
Scenario analysis is defined as the process of analysing future occurences by choosing present alternatives. It shows different future possibilities of an event, and not just one.
It is a for of projection analysis.
For example the manager's analysis is: if a severe earthquake occurred while the company was filming a movie, there could be deaths and injuries, destruction of movie sets, delays in production, costs associated with filming at an alternative location, and loss of reputation and good will.
Answer:
<u>b. False</u>
<u>Explanation:</u>
<em>Remember, </em>the term social responsibility in this context refers to an individual doing what would benefit society first, over any gain he may derive if he does otherwise.
For example, we are told that there is "low paying wages in Belize," which means low worker welfare, thus, even if no labor laws were been broken in his country, Olivia has a social responsibility to pay fair prices for the necklaces and earrings.
Answer:
When the new processes are developed for manufacturing it results in interest rate fluctuations. However, operational costs would become uncertain which would further affect the total production costs. Thus the value of an investment would be impacted. Automobile demand from the customers will also get affected. thus, fall in interest rate will have a significant and positive affect on the sale of automobiles as well as revenue.
