These organizations are called Political Action Committees.
Answer:
A) They would be indifferent, as Sally's income net of costs equals $25,000.
Explanation:
Sally's economic profit = accounting profit - opportunity costs
- accounting profit = $12,000
- opportunity costs = $25,000 - $15,000 in lost salaries + $2,000 (lost investment revenue) = $12,000
economic profit = $12,000 - $12,000 = $0
Since the economic profit is $0, Sally should be indifferent between running her own business or working for someone else.
Complete question:
On January 1. Year 1. White Co. sold a property with a remaining useful life of 20 years to Blue Co. for $900.000. At the same time. White entered into a contract with Blue for the right to use the property (leaseback) for a period of 6 years. with annual rental payments of 580.000 that approximate the market rental payments for similar properties. On January 1. Year 1. the carrying amount of the property was 5680.000. and its fair value was 5770.000. A discount rate for the lease of 10% is used by both White and Blue. The present value factor for an ordinary annuity at 10% for 6 periods is 4.3553. The lease does not transfer the property to White at the end of the lease term and does not include a purchase option.
What amount of lease expense for the right of use of the property is recognised by White in Year 1 ?
A. $0
B. $130,000
C. $90,000
D. $220,000
Answer:
$90,000 amount of lease expense for the right of use of the property is recognised by White in Year 1
Explanation:
If the leaseback is known as an operating lease, the original transition to the buyer-lessor of the asset should be taken into account as the selling of an asset, given that all the income identification requirements have been fulfilled.
If the deal is of equal value, the lender lease is informed of the gain or loss of sale between the purchase price and the sum of the land that is held. Yet this is not a equal value trade. The property's sale price is higher than its market value. Accordingly, the income or loss on sale seems to be the difference between the equal worth and the value of the land.
Therefore, on 1 January, White records a benefit of $90,000 in revenue of $770,000 (fair value of $680,000 in carrying amounts)
Answer: Differential cost is $5 per unit
Explanation:
Differential cost is the extra cost that the company would incur if they made the product themselves versus if they bought it from an outside supplier.
Differential cost is therefore:
= Cost to produce internally - Cost from supplier
= 23 - 18
= $5
<em>likely</em>
Answer:
Comparative advertisements need legal support for their claims and must not misrepresent competing products/brands
Explanation:
Comparative advertisement is also called advertising war. A competitor is named in the advertisement and reasons are given why the competitor's product is inferior to the one being advertised.
In this type of advertisement to prevent adverse legal action the company needs to carry out extensive research to provide legal backing for their claims.
Firms must also not misrepresent the competitor's product as this can lead to legal action.
