If government regulators guarantee a natural monopolist that it will earn normal profits, then the monopolist will  

a) achieve resource-allocative efficiency.  

b) charge a price above average total cost.  

c )produce a quantity of output at which marginal revenue equals price.  

d) none of the above

A. The Contribution Margin Income Statement has a higher Net Operating Income than the Absorption Costing Income Statement: true or false

B. The horizontal line on the CVP Graph represents what one?

fixed costs

total revenue

total expenses

Variable Cost

The following accounts and normal balances existed at year-end. Make the four journal entries required to close the books:

Retained Earnings $22000
Dividends $6000
Fees Earned Revenue $90000
Selling expense $45000
Administrative expenses $16000
Miscellaneous expense $2300

GASB suggests that there are 4 major differences between governments and businesses:

1. Organizational Purpose

2. Revenue Process and Sources

3. Longevity

4. Relationship with Stakeholders

5. Importance of Budget

Explain the difference between governments and for-profit businesses in each of these 5 areas.

Evaluating a company’s economic health and stability is just as important as evaluating their performance. Economic health metrics should provide insight into the strength of a company’s Balance Sheet. What metric is distorted to hide revenue problems, and how would a company go about distorting this metric?

A businessman asks you to provide a profitability profile of his customers. Once you have provided it, he remarks: "so i should drop all those customers where the costs of servicing the customer exceed the revenue from that customer?" Answer him and explain.

A Company is evaluating the idea of invest $180,000 in a machine and $20,000 in others initial costs. In the first year the company will have $100,000 revenue. In the second and third year the revenues are going to increase 10% per year. Calculate discount payback period. (Discount rate 20%)

The following items are located “below the line” on the income statement for a manufacturing firm:

Select one:

a. Interest expense

b. All of the listed answers

c. None of the listed answers

d. Sales tax or value added tax (VAT) taxes

e. Deferred revenue

•Evaluate the elasticity of demand for a car by applying a minimum of two elasticity determinants. Does the car likely have an elastic or inelastic demand based upon your evaluation of factors influencing the price elasticity of demand? How will considering these elasticity determinants impact product revenue?