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2 years ago

During 2011, Gum Co. introduced a new product carrying a two- year warranty against defects.

1 answer:

4 0

The amount that Gum should report as estimated warranty expense on its December 31, 2012 balance sheet is $14,250.

First step is to calculate the estimated cost related to dollar sales

Estimated cost related to dollar sales=2%+4%

Estimated cost related to dollar sales= 6%

Second step is to calculate the estimated warranty expense that should be reported

Estimated warranty expense =(400,000×6%)-Total of actual warranty expenditures of $9,750

Estimated warranty expense=$24,000-$9,750

Estimated warranty expense=$14,250

Inconclusion the amount that Gum should report as estimated warranty expense on its December 31, 2012 balance sheet is $14,250.

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Explanation:

According to Ricardian theory, any change in budgets deficits or surpluses should be completely offset by an equal change in private savings.

In this case, the original amount of private savings was 80, but since the budget deficit decreased by 40, then the private saving should also decrease by 40. The total private saving = 80 - 40 = 40

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It corresponds to an approach developed by Cialdini, who states that reciprocity is the first principle of persuasion, as individuals are conditioned to reciprocate favors and concessions to others.

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1 year ago

A product-process matrix can be used to address the fact that customers often participate in service processes.

dimaraw [331]

A product-process matrix can be used to address the fact that customers often participate in service processes.

This is FALSE.

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9 months ago

Which of the following statements best reflects a price-taking firm? a The firm has an incentive to charge less than the market

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A price taking firm is a firm that must sell at the price determined by the forces of demand and supply. This is typical of firms that in industries that sell identical products.

If the firm charges a price higher than equilibrium price, customers would go to other suppliers and the firm would sell known of its product.

There would be no incentive for a firm to sell below equilibrium price because it would be earning losses.

An example of an industry characterised by price taking firms are perfectly competitive industries.

For example, a farmer selling oranges is an example of a price taking firm

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2 years ago

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mario62 [17]

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