Southwest Airlines offers vacation packages that include airfare, car rental, and lodging. Southwest is using a(n) <u>bundle </u>pricing strategy.
What is bundle pricing ?
A pricing strategy in which managers offer multiple products or services as a single package ("bundle") is called bundle pricing.
Motivation of bundle pricing:
Particularly useful if your customers' demand is highly variable but price discrimination is impractical.
When consumers' price sensitivity of demand varies widely and market conditions make price discrimination difficult
If customers have diverse tastes, it can increase the seller's profit.
It is a method of simulating perfect price discrimination when perfect price discrimination is not possible or when charging multiple prices for the same product is illegal.
Types:
Simple Bundling: When managers offer multiple products or services in a single package so that customers do not have the option of purchasing package components separately
Mixed Bundling: Allows customers to purchase package components as a whole or separately.
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Answer: a). Debit Factory Payroll Payable $160,000; credit Cash $160,000.
Explanation: Direct labor refers to the manpower used in production. They are the factory workers involved in using the raw materials to produce finished goods.
Expense on direct labor is provided for during the production by a debit to factory payroll expense and a credit to factory payroll payable.
As such, the journal entry will be a debit to factory payroll payable $160,000 and a credit to cash $160,000. This means cash will reduce by $160,000 as the factory workers are paid while payables which is a provision account will reduce as well on the cash book by the same amount.
It is false that the market rate is used to calculate the actual cash payments made to bondholders rather it is the economic price for goods and services that is offered for them in free market or market place. It is also called a going rate, the market value or market price are equal only under conditions of market equilibrium and rational expectation.
Answer:
$3,220.90
Explanation:
Expected Return = $517 * 12 months * 20.8 years
Expected Return = $129,043.20
Exclusion Percentage = $62,000/ $129,043.20
Exclusion Percentage = 0.4804593
Exclusion Percentage = 48.05%
Exclusion amount = $6,200 * 48.05%
Exclusion amount = $2,979.1
Amount included in Income = $6,200 - $2,979.1
Amount included in Income = $3,220.90
Answer:
passive income if taxable income is negative;active income if taxable income is positive.
