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goldenfox [79]
2 years ago
8

Indicate the effect on the accounting equation and on the debit-credit analysis. Aug. 1 Opens an office as a financial advisor,

investing $8,000 in cash. 4 Pays insurance in advance for 6 months, $1,800 cash. 16 Receives $3,600 from clients for services performed. 27 Pays secretary $1,000 salary.
Business
1 answer:
Novosadov [1.4K]2 years ago
4 0

Answer: Please refer to Explanation

Explanation:

A. Aug. 1 Opens an office as a financial advisor, investing $8,000 in cash.

This is an investment by the owner so the following will happen.

The Cash account will INCREASE by $8,000

The Owner's Equity Account will INCREASE by $8,000 as well.

Cash is an Asset and when it INCREASES you DEBIT it. So DEBIT Cash by $8,000.

Owners Equity is an Equity Account and when INCREASED you CREDIT it. So Credit Cash by $8,000.

B. 4 Pays insurance in advance for 6 months, $1,800 cash.

This is a Prepaid Expense which means that it is an Asset because it represents that we are owed for service.

The Prepaid Insurance Account will Increase

The Cash Account will Decrease as the money from paid from it.

Prepaid Expense is an Asset which INCREASED so DEBIT it by $1,800.

Cash is an Asset as well and when Assets DECREASE you CREDIT them so CREDIT Cash by $1,800.

C. 16 Receives $3,600 from clients for services performed.

This is Revenue because the company is receiving money for service performed.

Revenue brings Cash into the business so the Cash account will INCREASE by $3,600

The Revenue Account will INCREASE by $3,600 to signify that Revenue came in.

Cash as an Asset will be DEBITED for $3,600 to signify that it has INCREASED.

Revenue will be CREDITED because it is an Equity Account to signify that it has INCREASED as well.

D. 27 Pays secretary $1,000 salary.

Payment of salary is an expense.

Expenses are paid from the Cash Account so this means that Cash has DECREASED by $1,000.

The Salaries and Wages Expense is INCREASED by $1,000.

Expenses are generally DEBITED when they increase so the Salaries and Wages Expense will be DEBITED by $1,000.

Cash as an asset will be CREDITED to reflect the DECREASE in the amount by $1,000.

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Answer: The answer is given below

Explanation:

A best-cost strategy is a strategy that is used by companies as they focus on low cost in order to give their customers better value for the money spent on the purchase of goods or services from them. The goal of this strategy is to keep the prices and costs lower when compared with the other competitors that offer similar products.

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An example of a firm in Jacksonville that is following a best cost strategy is

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Answer:

When PED is greater than one, demand is elastic. This can be interpreted as consumers being very sensitive to changes in price: a 1% increase in price will lead to a drop in quantity demanded of more than 1%. When PED is less than one, demand is inelastic.

so it is true

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Based on the information given we were told that the already existing product (X) has a marginal utility of 10 utils as well as the price of the amounts of $5 while the new product (Y) has a marginal utility of 8 utils as well as the price of the amounts of $1 which means that PRODUCT Y marginal utility and price is lower than that of PRODUCT X marginal utility and price.

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