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insens350 [35]
3 years ago
13

On November 1, Jasper Company loaned another company $270,000 at a 8.0% interest rate. The note receivable plus interest will no

t be collected until March 1 of the following year. The company's annual accounting period ends on December 31. The amount of interest revenue that should be reported in the first year is:
Business
1 answer:
Lostsunrise [7]3 years ago
5 0

Answer:

The interest revenue that should be reported in the first year, for two months from November to December, on 31 December is $3600.

Explanation:

According to the accrual basis of accounting, the revenues and expenses for a particular period should be recorded in the period to which they relate to rather then when they are received or paid. This means that although the interest will be received on March 1 of the next year, the interest revenue on note receivable for a period of two months from November to December should be recorded in the first year because it has been earned in the first year and it relates to it.

Interest revenue - first year = 270000 * 0.08 * 2/12 = $3600

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Pettit Ice Cream Company produces various ice cream products for which demand is highly seasonal. The company sells more ice cre
Rashid [163]

Answer:

a) Fixed costs = $22,000

b) $70,000

c) The high low cost method is generally inaccurate because it only considers the extremes, the highest and lowest costs and activity levels. Generally costs are not linear, but they might follow a certain tendency. The advantages of the high low cost method is that it is fairly accurate when costs are stable, plus it is much simpler to calculate.

d) Assuming that costs follow a certain tendency, regression analysis is much more exact since it analyses the relationship between different data and different variables. When you analyze only 2 variables, a linear regression analysis will serve you. but if you need to analyse more than two variables, then you must use a multiple regression analysis.

The R² statistic basically measures how one variable's variance is affected by other variables. E.g. if R² is 0.75, then 75% of the variance of A will be explained by the variance of B.

Explanation:

variable cost using high low cost method = (highest activity cost - lowest activity cost) / (highest activity level - lowest activity level) = ($82,000 - $46,000) / (50,000 - 20,000) = $36,000 / 30,000 gallons of ice cream = $1.20 per gallon of ice cream

fixed costs = $82,000 - (50,000 x $1.20) = $22,000

40,000 gallons

$22,000 + (40,000 x $1.20) = $70,000

how regression analysis improves accuracy of high low cost method

3 0
3 years ago
Suppose the labor force stays​ constant, and the working age population stays​ constant, but some people who were unemployed bec
julsineya [31]
...increase due to unemployed people becoming employed and joining labor force, along with the fact that the working age population is staying constant
5 0
3 years ago
Joseph shops for sugar at the grocery store. There are two types of sugar to choose from: a two-pound bag and a five-pound bag.
ira [324]

Answer:

$4

Explanation:

Let T = number of two pound sugar bags

and F = number of five pound sugar bags

6T + 3F = 24

3T + 1F = 10

F = 10 - 3T

replace in first equation

6T + [3 x (10 - 3T)] = 24

6T + 30 - 9T = 24

6 = 3T

T = $2

F = 10 - (3 X $2) = $10 - $6 = $4

6 0
2 years ago
Use the midpoint method when applicable to calculate the price elasticity of demand.
Neko [114]

Answer:

Follows are the solution to the given points:

Explanation:

In point a:

This business of plastic containers is increasing its Lunchbox Product Signature price around $3.00 and $4.00.   The volumes produced consequently declined around 20,000 to 15,000.

\text{Price elasticity} =  \frac{\frac{15000-20000}{(\frac{15000+20000}{2})}}{\frac{4-3}{(4+\frac{3}{2})}}

                        =\frac{\frac{-5000}{(\frac{35000}{2})}}{\frac{1}{(\frac{7}{2})}}\\\\=\frac{\frac{-5000}{17500}}{\frac{1}{3.6}}\\\\=\frac{\frac{-50}{175}}{\frac{1}{3.6}}\\\\= \frac{-0.2857}{0.2857} \\\\ =-1

The price elasticity also becomes unitary

In point b:

U.S. economic theory states that the elasticity of fuel demand is 0.5 because prices would be less than 1 and so are non-elastic.

In point c:

The capital Metro agrees and add $2.00 to $2.21 also for bus fares. Consequently, with an average of 70,000 drivers a days to both a daily average 61,000 drivers, its passenger numbers who take the bus in Austin falls.

\text{Price elasticity} = \frac{\frac{61000-70000}{(61000+ \frac{70000}{2})}}{ \frac{2.21-2}{(2.21+\frac{2}{2})}}

                        = \frac{\frac{-9000}{(61000+ 35000)}}{ \frac{0.21}{(2.21+1)}} \\\\= \frac{\frac{-9000}{(96000)}}{ \frac{0.21}{(3.21)}} \\\\= \frac{\frac{-9}{(96)}}{ \frac{0.21}{(3.21)}} \\\\= \frac{-0.1374}{0.099} \\\\ = -1.38

The value being higher than 1 is elastic.

5 0
2 years ago
Starbooks Corporation provides an online bookstore for electronic books. The following is a simplified list of accounts and amou
Sauron [17]

Answer:

1 Required: 1-a. Prepare an adjusted trial balance at September 30, 2018.

Explanation:

Starbooks  

Adjusted trial balance  

 

d Cash                           $ 295  

d Account receivable  $ 295  

d Supplies                      $ 495  

d Equipment $           3.195  

c Accumulate depreciation            $ 895

d Prepaid Rent                   $ 95  

c Account Payable                             $ 595

c Notes Payable (short-term)              $ 495

c Deferred Revenue                          $ 195

c Notes Payable (long-term)                  $ 195

c Common Stock                                       $ 195

c Retained Earnings                               $ 1.495

c Service Revenue                                 $ 6.185

c Interest Revenue                                    $ 95

d Salaries Expense $ 2.195  

d Depreciation Expense $ 295  

d Income Tax Expense $ 295  

d  Rent Expense      $ 395  

d Supplies Expense      $ 195  

d Travel Expense   $ 2.595  

 

                       Total $ 10.345 $ 10.345

5 0
3 years ago
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