Answer:
Cause-and-effect relationship - Cost of goods sold
With the Cause and effect relationship, costs are linked to the revenue that they were incurred for to create. Cost of goods would therefore be linked to revenue.
Specific time period - Monthly salary payments to an office employee
Costs are to be recognized in the same period of time they were incurred. The monthly salary is to be paid monthly because it is incurred monthly.
Without regard to related revenue in the period incurred - Advertising expenditures
The advertising costs will be incurred when spent and not when the benefits are accrued.
Answer:
The Journal entry for each of the transaction is as follows:
(i) On June 1,
Cash A/c Dr. $5,000
To Oleg Thorn's capital A/c $5,000
(To record the capital invested)
(ii) On June 2,
Equipment A/c Dr. $3,600
To accounts payable $3,600
(To record the purchase of equipment on account)
(iii) On June 3,
Rent Expense A/c Dr. $800
To cash A/c $800
(To record the rent paid)
(iv) On June 12,
Accounts receivable - K. Johnsen A/c Dr. $400
To service revenue $400
(To record the service revenue)
The accounts to be debited and credited for each transaction is as follows:
(i) On June 1,
Debit = Cash and Credit = Oleg Thorn's capital
(ii) On June 2,
Debit = Equipment and Credit = accounts payable
(iii) On June 3,
Debit = Rent Expense and Credit = cash
(iv) On June 12,
Debit = Accounts receivable - K. Johnsen and Credit = service revenue
The company's net income will increase if this product line is eliminated because of the decrease in the fixed cost.
<u>Explanation:</u>
In Economics, fixed costs, backhanded expenses or overheads are operational expense that are not reliant on the quantity of products or administrations delivered by the business. They will in general be time-related, for example, intrigue or leases being paid every month, and are regularly alluded to as overhead expenses.
With the decrease in the fixed costs of the company by closing this product line, the total cost of the company will also decrease and then this will increase the net income of the company.
More than likely Option B
This represent "adopting a new standing plan" management action.
<u>Answer:</u> Option B
<u>Explanation:</u>
Planning enables an organization to define its goals.The policies, protocols and initiatives which are structured to ensure safe operation of the internal workings of a given company or organization, thus understood as "standing plans". Such plans are often once created and then changed as needed to meet the requirements of the business. Instances of standing plans involve employee contact policies, company internal reporting protocols, and regulations regarding what is acceptable and what is forbidden in the sector.
