1). During January of 2007, the average price of regular unleaded gasoline in Oakland, California increased 11.0 percent. If the price elasticity of demand for gasoline was 0.13, the price hike means that the quantity demanded decreased by.
2). If a 4 percent change in the price of a good leads to a 3 percent change in quantity demanded, the price elasticity of demand equals
3). The price elasticity of demand is a measure of
4). If the price of a scooter increases by 20 percent and the quantity supplied of scooters increases by 30 percent, then the price elasticity of supply is
5). Suppose the New Orleans Saints lowers ticket prices by 13 percent and as a result the quantity of tickets demanded increases by 21 percent. This response means that the price elasticity of demand for Saints tickets is
6). Total revenue equals
7). Suppose the current price of barley is $7 per bushel and at that price 100,000 bushels are demanded. If the price of barley rises 14% and quantity demanded decreases by 23% what is the price elasticity of demand for barley?
8).
A minimum wage is an example of a
10). If the demand for insulin is inelastic, an increase in insulin prices leads to
In: Economics
In: Finance
Use the information given below to answer Questions 10 - 15. Robin Industries, Inc., [RI] manufactures and sells electronic solid fuel powered vehicles popularly known as BatKars [BK]. All units are sold with under a two-year warranty contract with a commitment to replace defective parts and provide the necessary labor services for such repair . During 2018 the corporation sold 6,000 BKs for cash at a unit price of $4,000. Based on past experience, the two-year warranty contracts are estimated to cost the company $380 per unit which included $80 per unit on parts and the balance for labor. These are recorded at the time when the sales are recorded. During 2018, RI incurred actual costs of $990,000 (which consisted of $444,000 for parts and the rest for labor) on repair work called for by customers on the sold units. Apply the expense-based (assurance-type) approach for answering Questions 10 - 12 stated below. NEXT You are then further informed that RI estimates $500 per unit of the product revenues from the above mentioned sales would would be considered as warranty revenues. 40% of these warranty revenues relate to year 2018 and the balance to year 2019. Now apply the revenue-based (service-type) approach for answering Questions 13 - 15.
10] The entry to record the warranty contracts issued in 2018 would be
a. Warranty Expenses ...... DR $1,080,000; Warranty Expenses Payable ...... CR $ 1,080,000.
b. Warranty expenses ...... DR $2,280,000; Cash ...... CR $2,280,000.
c. Warranty Expenses ...... DR $2,280,000; Estimated Warranty Liabilities ...... CR $2,280,000.
d. Warranty expenses ...... DR $2,280,000; Parts Inventory ...... CR $480,000; Direct Labor ...... CR $1,800,000
e. Warranty expenses ...... DR $24,000,000; Cash ...... CR $24,000,000.
11] Prepare the journal entry to record the actual warranty costs incurred by RI during 2018.
a. Warranty expenses ...... DR $1,080,000; Parts Inventory ...... CR $1,080,000.
b. Estimated Warranty Liabilities ...... DR $1,080,000; Parts Inventory ...... CR $1,080,000.
c. Estimated Warranty Liabilities ...... DR $990,000; Parts Inventory ...... CR $444,000; Direct Labor ...... CR $546,000; ..
d. Warranty expenses ...... DR $1,290,000; Estimated Warranty Liabilities ...... CR $1,290,000.
e. Warranty expenses ...... DR $1,080,000; CR Cash ...... $1,080,000.
12. How would the warranty transactions be reported on the financial statements for December 31, 2018 stating the appropriate classifications and amounts?
a. Income Statement: Sales Revenues ... $24,000,000; Warranty Expenses ... $2,280,000; and Balance Sheet: Non-Current Liability - Estimated Liability for Warranties ... $1,290,000.
b. Income Statement: Warranty Revenues ... $24,000,000; Warranty Expenses ... $2,280,000; and Balance Sheet: Current Liability - Estimated Liability for Warranties ... $1,290,000.
c. Income Statement: Sales Revenues ... $24,000,000; Warranty Expenses ... $990,000; and Balance Sheet: Current Liability - Warranties Payable ... $990,000.
d. Income Statement: Sales Revenues ... $24,000,000; Warranty Expenses ... $990,000; and Balance Sheet: Non-Current Liability - Estimated Liability for Warranties ... $1,290,000.
e. None of the above.
13] What would be the journal entry to record the sales of the BatKars and the warranty in 2018?
a. Cash ...... DR $24,000,000; Sales Revenue ...... CR $21,000,000; Warranty Payable ...... CR $3,000,000.
b. Cash ...... DR $24,000,000; Sales Revenue ...... CR $21,000,000; Unearned Warranty Revenue ...... CR $3,000,000.
c. Cash ...... DR $24,000,000; Sales Revenue ...... CR $21,000,000; Gain On Warranty ...... CR $3,000,000.
d. Cash ...... DR $24,000,000; Sales Revenue ...... CR $23,010,000; Warranty Payable ...... CR $990,000.
e. None of the above.
14] The journal entry to record the actual warranty costs incurred in 2018 would be
a. Warranty Expense ...... DR $990,000; Cash ...... CR $546,000; Parts Inventory ...... CR $444,000
b. Warranty Expense ...... DR $990,000; Warranty Payable ...... CR $990,000.
c. Warranty Expense ...... DR $990,000; Estimated Liability for Warranties ...... CR $990,000.
d. Warranty Revenues ...... DR $990,000; Cash ...... CR $546,000; Parts Inventory ...... CR $444,000.
e. Warranty Expense ...... DR $990,000; Direct Labor ...... CR $546,000; Parts Inventory ...... CR $444,000.
15] How would the warranty transactions be reported on the financial statements for December 31, 2018 stating the appropriate classifications and amounts?
a. Income Statement: Sales Revenue ...... $21,000,000; Warranty Revenue ...... $1,200,000; and Warranty Expenses ...... $990,000; and Balance Sheet: Current Liability - Estimated Liability for Warranties ...... $1,800,000.
b. Income Statement: Sales Revenue ...... $21,000,000; Warranty Revenue ...... $1,200,000; Warranty Expenses ...... $990,000; and Balance Sheet: Current Liability - Unearned warranty revenue ...... $1,800,000.
c. Income Statement: Sales Revenue ...... $21,000,000; Warranty Revenue ...... $1,200,000; Warranty Expenses ...... $990,000; and Balance Sheet: Non-Current Liability - Unearned warranty revenue ...... $1,800,000.
d. Income Statement: Sales Revenues ...... $24,000,000; Warranty Expenses ...... $1,200,000; and Balance Sheet: Current Liability - Unearned warranty revenue ...... $1,800,000.
In: Accounting
Identify the impact on the income statement and balance sheet if adjusting entries for the following situations were not
recorded.
a. Office Supplies used, $800.
b. Accrued service revenue, $4,000.
c. Depreciation on building, $3,500.
d. Prepaid Insurance expired, $650.
e. Accrued salaries expense, $2,750.
f. Service revenue that was collected in advance has now been earned, $130
In: Accounting
Executives at Bob's widgets notice the company’s revenues have increased by a constant amount of $5 million each year for the past several years. This trend is expected to continue for the foreseeable future. Suppose next year’s revenue is $300 million. Bob's widgets' MARR is 7%. You’re curious about the present worth of Bob's widgets' revenue over the next 5 years.
In: Finance
A new company has an upfront cost of $250,000 today. Starting one year from today they will produce a revenue of $85,000 every year for a total of ten years. The following year (t=11), the revenue will grow at a rate of 7% and this growth rate will remain constant every year forever. The interest rate is 8%. What is the value of these cash flows today for this new company?
In: Finance
The short-run supply curve for an individual firm operating in a perfectly competitive market is:
a. the marginal cost curve at or above the average total cost curve.
b. the marginal cost curve at or above the average variable cost curve.
c. the marginal revenue curve at or above the average total cost curve.
d. the marginal revenue curve at or above the average variable cost curve.
In: Economics
The Fijian government has been recently holding budget consultations around the country. In June 2019, the government will come up with an expenditure and revenue plan. What kind of goods and services should the government tax if we wish to maximize our revenue collections for the upcoming fiscal year? How will be the tax burden shared between ordinary Fijians and firms? Explain your answer.
In: Economics
Which of the following would not be a correct form for an adjusting entry?
A. A debit to an expense and a credit to a liability
B. A debit to an asset and a credit to a revenue
C. A debit to a liability and a credit to a revenue
D. A debit to an asset and a credit to a liability
The answer is D, please explain why and please list all correct adjusting entries, and name some incorrect adjusting entries the explain why.
In: Accounting
Alice’s hair salon increased its total monthly revenue from RM10,000 to RM15,000 when it raised the price of hair cut from RM50 to RM60.
a. Calculate the price elasticity of demand for Alice’s hair salon.
b. Suppose you are the hair salon’s consultant, if Alice wish to increase her revenue, would you advise her to continue with her existing plan?
In: Economics