It means to say that the demand of the product is decreasing. The relationship between the price and demand is one way. It means to say that if the price increases, the demand is higher. In this scenario, the price increases to avoid shortage on the product. If the price is decreasing, it means to say that the demand is decreasing and can possibly cause surplus on the said product. Lowering the price allows consumers to have higher purchasing power and enticing them to purchase such product.
Answer:
Explanation:
1. Borrow SF 200,000 at a rate 5%, (SF200,000/1.05) = SF 190,476.
2. Convert SF 190,476 to USD at a spot $0.48
SF190,476 x $0.48 = $91,428
3. Invest $91,428 at 6% = $91,428 x1.06 = $96,914
Answer:
Standard Overhead rate is $1.25 per Direct labor hours
Explanation:
Total variable cost (2000 unit * $2.50) = $5,000
Total fixed cost = <u>$5,000</u>
Estimated Overhead cost = <u>$10,000</u>
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Estimated Direct labor hour = 2000 unit * 4 hours = 8,000 hours
Standard Overhead rate = Estimated overhead cost / Estimated Direct labor hour
Standard Overhead rate = $10,000 / 8,000 hours
Standard Overhead rate = $1.25 per Direct labor hours
Answer:
The estimated Bad Debt Expense for the period is $13,600
Explanation:
Quill Industries estimates of uncollectible receivables resulting from the aging analysis equals $20,000. The company uses the aging of accounts receivable method and the Allowance for Doubtful Accounts has credit balance of $6,400 before adjusting.
Bad debt Expense = $20,000 - $6,400 = $13,600
The entry:
Debit Bad debts expense $13,600
Credit Allowance for doubtful accounts $13,600
Answer:
2) Chemotherapy for cancer patients
Explanation:
Chemotherapy for cancer patients is a basic necessity needed for the patient to continue living, so if the price of chemotherapy increases or decreases will not affect the patient's choice of getting it. What can affect the patient's decision is whether he/she can afford the treatment, but even if he/she can't they will seek other ways of trying to obtain it, e.g. going to public hospitals.