Answer:
$64,600
Explanation:
Given that
Variable costing net operating income last year = $1,03,000
Fixed manufacturing overhead costs = $38,400
The computation of net operating income is as shown below:-
= Variable cost - Overhead cost
= $1,03,000 - $38,400
= $64,600
So, from the above calculation we simply deduct Variable cost from Overhead cost.
The correct entry to write off a $400 receivable owed by Ajax Co. using the Direct Write-Off Method would be: Debit Accounts Receivable-Ajax and credit Allowance for Doubtful Accounts for $400. Debit cash $400 and Credit Accounts Receivable $400.
Answer:
Service products cannot generally be produced in advance or stored.
Services are typically variable, and in almost every service offering, the service cannot start until the customer arrives and actively participates.
Explanation:
Services have distinguishing characteristics that differentiate them from goods.
To start with, services cannot be produced in advance as production and consumption happen at the same time.
Also,the customer must be present and actively contributes to the delivery of the service, for instance, haircut cannot happen except the customer comes to the salon and obeys the instructions of the barber as they go along.
Besides,there is no physical substance in service unlike purchase of goods.
<u>Solution and Explanation:</u>
(a). Firm in perfect competition produces at minimum efficient scale, MEC where average cost AC is minimum. The price is determined by the market supply and demand.
(b) Note that q1 is at the minimum of AC while Q* is to the left of q1. Similarly, P1 is equal to MC while P* is higher than MC. This shows that firms in perfect competition produce more and charge less than the firms in monopolistically competitive market.
(c) All firms in monopolistically competitive market as well as perfectly competitive market earn zero economic profit in the long run. This is because there is a free entry and exit
(d) Demand is steeper for firms in monopolistically competitive market so that demand is elastic. Demand is horizontal for any quantity which means it is perfectly elastic for a firm in competitive market.
