Answer:
There are many different price adjustment strategies which can be implemented in the current market.
Explanation:
Psychological pricing:
Psychological pricing is a strategy in which the price of a product is displayed with mostly one cent difference so the whole number shown is less by $1 and this difference can get higher if the price of the product is more.
Example 1: The price for a toy in a toy shop is $4.99, if rounded this will be $5 but the whole number visible is $4.
Example 2: The price of a laptop is $193, this again is nearly $200 but the price is reduced by $7 in order to influence their customers into buying the product.
Example 3: The price of a car is $35,995, this again is about $36,000 but the buyer may be influenced by this technique and result in purchasing the product with such price.
Geographical Pricing:
Geographical pricing is a strategy where different prices are charged in different outlets, this strategy is made keeping in mind the purchasing power of the locality, if the local people can pay higher price for a product then the price is high there but same product may have a lower price in an area where people can not pay high price.
Example 1: Price of a T-shirt is $15 in a posh area while the price of the same T-shirt is $5 in an area with poor locality.
Example 2: Price of a hair brush is $10 in a poor area while the same brush is available in a posh area at a rate of $35.
Example 3: Price for a food item is $6 in a restaurant in posh area while the same burger is available for $3 in a restaurant in a poor area.
Answer
The answer and procedures of the exercise are attached in the following archives.
Step-by-step explanation:
You will find the procedures, formulas or necessary explanations in the archive attached below. If you have any question ask and I will aclare your doubts kindly.
Answer:
a- Parts - (asset) Dr $54000
Note payable Cr $54000
b- Note payable Dr $4500
Cash/Bank Cr 4500
c- Interest expense for the year end= $2700
Explanation:
The entry to record the purchase of parts from SUPPLY Corp will result in, an increase in asset and liability because ACE Corp isn't settling the purchase via a cash/bank payment rather it's issuing a 1-year installment note. Therefore the entry is as follows:
Parts - (asset) Dr $54000
Note payable Cr $54000
Now the payments on the 1-year note are installment based which means the $54000 note payments would have to be split between twelve months (i.e one year). The monthly payment would be $4500 against note payable.
The entry to record first installment payment on august is as follows:
Note payable Dr $4500
Cash/Bank Cr 4500
Moreover, along with payment of $4500 ACE Corp is also liable to pay interest on the payments made. Therefore, interest shall be calculated on monthly payment of $4500 at the rate of 12% as follows:
Interest on payment = $4500×12%
Interest on monthly payment = $540
The interest expense to be reported by ACE in its income statement for the year ended 12/31/2016 is of Five months (i.e from Aug till Dec), see as follows:
Interest expense for the year end= $540×5
Interest expense for the year end= $2700
Answer:
(a) 28
(b) 45
(c) 18
(d) 65
Explanation:
Total manufacturing costs:
= Cutting + Assembly + Inspecting + Rework
= $215,600 + $330,750 + $58,140 + $39,000
= $643,490
Total Cutting hours:
= Vacquero + Vaquera hours
= 2,300 + 5,400
= 7,700
Total Assembly hours:
= Vacquero + Vaquera hours
= 2,700 + 4,650
= 7,350
Total Inspection hours:
= Vacquero + Vaquera hours
= 800 + 2,430
= 3,230
Total rework hours:
= Vacquero + Vaquera hours
= 150 + 450
= 600
Therefore,
Activity rate = Total Cost ÷ Total hours
For cutting:
= $215,600 ÷ 7,700
= 28
For Assemble:
= $330,750 ÷ 7,350
= 45
For Inspection:
= $58,140 ÷ 3,230
= 18
For Rework:
= $39,000 ÷ 600
= 65