Answer:
Part a
Debit : Accounts Receivable $18,000
Debit : Cost of Sales $10,800
Credit : Sales Revenue $18,000
Credit : Inventory $10,800
Part b
Debit : Cash $16,200
Debit : Discount allowed $1,800
Credit : Accounts Receivable $18,000
Part c
Debit : Accounts Receivable $600
Credit : Cash $600
Explanation:
The perpetual method calculates the cost of sales for each transaction made.
See the journals prepared as above
Answer:
1. Cost of the old X-ray machine - SC
2. The salary of the head of the Radiology Department - None
3. The salary of the head of the Pediatrics Department - None
4. Cost of the new laser printer - DC
5. Rent on the space occupied by Radiology - None
6. The cost of maintaining the old machine - DC
7. Benefits from a new DNA analyzer - OC
8. Cost of electricity to run the X-ray machines - DC
Where,
SC - Sunk cost
DC - Differential cost
OC - Opportunity cost
Answer:
A) Diffusion of responsibility; escalation of commitment.
Explanation:
Diffusion of responsibility relates to the concept of psychology in which the individual tends to create the responsibility of some different person, because the group size is to large and then the individual thinks not to take the responsibility.
Escalation of commitments relates to the fact that an individual continues with all the previous decisions and do not alter his actions, in consideration to the current circumstances.
In the given instance, John Walker the CEO never met any of the employees of third-world nation, and therefore, he continues his decision, that this plant shall be closed as he once again do not study all the plants, but believes illogically that the close of this plant will be beneficial to company.
Answer:
$2,500,000
Explanation:
Break Point = Level of debt / Weight of debt
(100%-40%)
=60%
Hence:
= 1,500,000 / 60%
= $2,500,000
Therefore the debt breakpoint in the MCC schedule will be $2,500,000
