Answer:
goodwill = $195,000
Explanation:
goodwill = offered purchase price - fair value of assets - fair value of patents = $5,100,000 - $4,600,000 - $305,000 = $195,000
Customer loyalty is part of a company's goodwill, so it will not be included in this calculation. Goodwill is the difference between the acquisition price of a company and the fair value of its assets.
Answer:
The company should increase the number of units she is producing
Explanation:
Since the elasticity of demand for the product is greater than one (1.4), it means the demand for the new drug is elastic, meaning the demand for the new drug is sensitive to price – the higher the price, the lower the quantity demanded and the vice-versa. So the pharmaceutical company should be careful of charging higher than the other competitors.
What the company needs to do to increase its revenue is to produce large quantity of the drug in order to earn higher and gain larger market share and probably economies of scale.
For example, If the company produces 400 units of the drug at $2, the revenue will be $800.
To increase the revenue, the company needs to increase its production.
For example, the increases the production to 500 units at the prevailing price of $2, therefore, the revenue will be $1000
Answer:
The entry should be:
c. Debit Cash $45,731.25; credit Interest Revenue $731.25; credit Notes Receivable $45,000
Explanation:
Jasper makes a cash loan to Clayborn Co.. This is a Notes Receivable of Jasper.
The amount of the loan is $45,000
Tern of the loan is 90-day and interest rate is 6.5%
The interest amount Jasper receives on maturity date:
$45,000 x 6.5% x 90/360 = $731.25
The entry should be:
Debit Cash $45,731.25
Credit Interest Revenue $731.25
Credit Notes Receivable $45,000
Answer:
Accepting the special order will reduce Toms operating income by $50,000
Explanation:
See attached file
Answer:
Credit to notes payable for $165000
Explanation:
Journal entries for issuance of Note Payable :
Cash Account ..... Debit $165000
7% Note payable Accounts .... Credit $165000
Note:
Note payable is a liability so it is credited as on date of issuance.
