Answer:
2.35
Explanation:
The computation of the money multiplier for the M1 is shown below:
As we know that
Money supply(M1) = Currency in circulation + Checkable deposits
M1 money supply is = $500 billion + $700 billion
= $1,200 billion
Now the M1 money multiplier is
We know that
Money multiplier = Money supply ÷ Monetary base
where,
Monetary base = Currency in circulation + Bank excess reserves
= $500 billion + $10 billion
= $510 billion
We know that,
Money multiplier = Money supply ÷ Monetary base
= $1,200 ÷ $510
= 2.35
A consumer must spend all of her income on two goods (X and Y). In each of the following scenarios, indicate whether the equilibrium consumption of goods X and Y will increase or decrease. Assume good X is a normal good and good Y is an inferior good.
a. Income doubles.
b. Income quadruples and all prices double.
c. Income and all prices quadruple.
d. Income is halved and all prices double.
Answer:
a. Income doubles
consumption of good X will increase (normal good) will consumption of good Y will decrease (inferior good)b. Income quadruples and all prices double.
consumption of good X will increase (normal good) will consumption of good Y will decrease (inferior good)c. Income and all prices quadruple.
consumption of both goods will remain at the same leveld. Income is halved and all prices double.
consumption of good X will decrease (normal good) will consumption of good Y will increase (inferior good)
If fixed costs are $200,000 and the unit contribution margin is $20, what amount of units must be sold in order to have a zero profit
Answer:
the amount of units that should be sold in the case when there is a zero profit is 10,000 units
Explanation:
The computation of the amount of units that should be sold in the case when there is a zero profit is given below:
No. of units to be sold is
= Fixed Cost ÷ Contribution per unit
= $200,000 ÷ $20
= 10,000 units.
hence, the amount of units that should be sold in the case when there is a zero profit is 10,000 units
4. Which of the following situations typically would result from an appreciating U.S. dollar relative to the
Canadian dollar?
A. More Canadian tourists visit the U.S.
B. Canadians purchase more U.S. goods
C. Fewer American tourists visit Canada
D. Americans purchase more Canadian made products.
Answer:
D. Americans purchase more Canadian made products.
Explanation:
The situation that would typically result from an appreciating U.S. dollar relative to the Canadian dollar is "Americans purchase more Canadian made products."
When Americans purchase more Canadian-made products, the Canadian dollar will rise or appreciate against the U.S. dollar. This is based on the principle of trade balance, whereby the monetary value of a country's imports and exports are evaluated over a given period.
In this case, the monetary value of Canadian exports against the U.S. dollar will indicate a positive trade surplus, hence, the Canadian dollar or currency will appreciate against the U.S. dollar.
Assume that, on January 1, 2021, Matsui Co. paid $1,795,200 for its investment in 74,800 shares of Yankee Inc. Further, assume that Yankee has 220,000 total shares of stock issued. The book value and fair value of Yankee's identifiable net assets were both $440,000 at January 1, 2021. The following information pertains to Yankee during 2021:
Net income $240,000
Dividends declared and paid $72,000
Market price of common stock on 12/31/2016 $29/share
What amount would Matsui report in its year-end 2016 balance sheet for its investment in Yankee?
a. $1,608,000.
b. $1,368,000.
c. $1,329,600.
d. None of these answer choices is correct.
Answer: $1,852,320
Explanation:
First find out the proportion owned by Matsui.
= 74,800 shares / 220,000
= 34%
The investment at the end of the year is:
= Cost of investment + Shares of net income - Share of dividend
Share of income:
= Percentage ownership * Net income
= 34% * 240,000
= $81,600
Share of dividend:
= 34% * 72,000
= $24,480
Investment at end of year:
= 1,795,200 + 81,600 - 24,480
= $1,852,320
DW has an ending Retained Earnings balance of $51,600. If during the year DW paid dividends of $4,100 and had net income of $21,100, then what was the beginning Retained Earnings balance
Answer:
$34,600
Explanation:
The computation of beginning retained earnings balance is seen below:
But we know that;
Ending balance of retained earnings = Beginning balance of retained earnings + Net income - Dividend paid
$51,600 = Beginning retained earnings + $21,100 - $4,100
Beginning retained earnings = $51,600 - $21,100 + $4,100
Beginning retained earnings = $34,600
Suppose you've just inherited $10,000 from a relative. You're trying to decide whether to put the $10,000 in a non-interest-bearing account so that you can use it whenever you want (that is, hold it as money) or to use it to buy a U.S. Treasury bond.
The opportunity cost of holding the inheritance as money depends on the interest rate on the bond.
For each of the interest rates in the following table, compute the opportunity cost of holding the $10,000 as money.
Interest Rate on Government Bond (Percent) Opportunity Cost (Dollars per year)
8 _____ (10,000.00 / 800.00 / 0.08 / 8.00 / 125,000.00)
10 _____ (10,000.00 / 10.00 / 100,000.00 / 1,000.00 / 0.10)
What does the previous analysis suggest about for money?
a. The quantity of money demanded decreases as the interest rate rises.
b. The quantity of money demanded increases as the interest rate rises.
c. The supply of money is independent of interest rate.
Answer:
A. $800
B. $1,000
C. a. The quantity of money demanded decreases as the interest rate rises
Explanation:
A. Computation for the opportunity cost of holding the $10,000 as money if Interest Rate is 8%
Opportunity Cost for 8% interest rate=$8%*$10,000
Opportunity Cost for 8% interest rate= $800
Therefore the opportunity cost of holding the $10,000 as money if Interest Rate is 8% will be $800
B. Computation for the opportunity cost of holding the $10,000 as money if Interest Rate is 10%
Opportunity Cost for 10% interest rate =10%*$10,000
Opportunity Cost for 10% interest rate = $1,000
Therefore the opportunity cost of holding the $10,000 as money if Interest Rate is 10% will be $1,000
C. Based on the information given the previous analysis suggest about for money: THE QUANTITY OF MONEY DEMANDED DECREASES AS THE INTEREST RATE RISES.
Review the transactions and determine the accounts, the account types (use assets; liabilities; owner, capital; owner, withdrawals; revenue; and expenses), if they increase/decrease and if they are DR/CR. List accounts in order they would be in the journal entry.Received cash on account from a customer.Account #1 Account Type Increase/DecreaseIncreaseDecreaseDebit/CreditDebitCreditAccount #2 Account Type Increase/DecreaseIncreaseDecreaseDebit/CreditDebitCreditAccrued liability for utilities.Account #1 Account Type Increase/DecreaseIncreaseDecreaseDebit/CreditDebitCreditAccount #2 Account Type Increase/DecreaseIncreaseDecreaseDebit/CreditDebitCreditPurchased office supplies on accountAccount #1 Account Type Increase/DecreaseIncreaseDecreaseDebit/CreditDebitCreditAccount #2 Account Type Increase/DecreaseIncreaseDecreaseDebit/CreditDebitCreditPaid cash for rent.Account #1 Account Type Increase/DecreaseIncreaseDecreaseDebit/CreditDebitCreditAccount #2 Account Type Increase/DecreaseIncreaseDecreaseDebit/CreditDebitCreditPurchased office furniture on accountAccount #1 Account Type Increase/DecreaseIncreaseDecreaseDebit/CreditDebitCreditAccount #2 Account Type Increase/DecreaseIncreaseDecreaseDebit/CreditDebitCreditRecord the following transactions as journal entries.Collected $7,000 cash for servicesCollected $7,000 cash for servicesDateAccounts and ExplanationDebitCreditNov. 3Paid $7,000 cash on account.Paid $7,000 cash on account.DateAccounts and ExplanationDebitCreditNov. 4Paid $7,000 cash for rent.Paid $7,000 cash for rent.DateAccounts and ExplanationDebitCreditNov. 5Paid $5,000 for advertising in the local paperPaid $5,000 for advertising in the local paperDateAccounts and ExplanationDebitCreditNov. 5Bright, the owner, withdrew $7,000 cash.Bright, the owner, withdrew $7,000 cash.DateAccounts and ExplanationDebitCreditNov. 5
Innovative Consulting Co. has the following accounts in its ledger: Cash, Accounts Receivable, Supplies, Office Equipment, Accounts Payable, Common Stock, Retained Earnings, Dividends, Fees Earned, Rent Expense, Advertising Expense, Utilities Expense, Miscellaneous Expense. Journalize the following selected transactions for October 20Y2 in a two-column journal. Journal entry explanations may be omitted. If an amount box does not require an entry, leave it blank.
Oct. 1. Paid rent for the month, $5,700.
3. Paid advertising expense, $3,610.
5. Paid cash for supplies, $1,550.
6. Purchased office equipment on account, $23,700.
12. Received cash from customers on account, $7,740.
20. Paid creditor on account, $2,270.
27. Paid cash for miscellaneous expenses, $980.
30. Paid telephone bill for the month, $360.
31. Fees earned and billed to customers for the month, $51,600.
31. Paid electricity bill for the month, $620.
31. Paid dividends, $3,900.
Answer:
would you still like me to help you with this question
The following standards for variable manufacturing overhead have been established for a company that makes only one product: Standard hours per unit of output 6.4 hours Standard variable overhead rate $12.80 per hour The following data pertain to operations for the last month: Actual hours 2,650 hours Actual total variable manufacturing overhead cost $34,570 Actual output 150 units What is the variable overhead efficiency variance for the month
Answer:
See below
Explanation:
Given the following;
Standard hours per unit of output 6.4 hours
Standard variable overhead rate $12.80 per hour
Actual hours 2,650 hours
Actual output 150 units
To calculate the variable overhead efficiency variance, we will use the formula below;
Variable overhead efficiency variance
= (Standard quantity - Actual quantity) × Standard rate
Standard quantity = 150 units × 6.4 = 960
Variable overhead efficiency variance
= (960 - 2,650) × $12.80
= $21,632 unfavourable
name the institution that investigates anti-competitive behaviour on companies in south africa
Explanation:
the competition committee of southafrica, set up in the year 1989 by the southafrica government under the competition act to empower to investigate, control and restrict business, abuse of dominant positions and merges in order to achieve equity and efficiency in the southafrica economy.
Applications that integrate business activities across departmental boundaries are often referred to as _____________ planning systems.
Answer:
Enterprise resource.
Explanation:
Enterprise Resource Planning (ERP) is a business strategy process where organizations manage and integrate the main parts of their day-to-day business activities by using software applications.
The ERP software system is used to integrate planning, accounting, finance, marketing and human resources.
For instance, when an organization is replacing a payroll program that it developed in house, with the relevant subsystem of a commercial Enterprise Resource Planning (ERP) system, It should be noted that a faulty migration of historical data from the old system to the new system represent the highest potential risk because you won't be able to measure and analyze performance.
Hence, software applications or programs that integrate all business activities across departmental boundaries such as marketing, procurement, customer relationship, sales, etc., are often referred to as enterprise resource planning systems.
A company recorded 2 days of accrued salaries of $1,500 for its employees on January 31. On February 9, it paid its employees $7,200 for these accrued salaries and for other salaries earned through February 9. Assuming the company does not prepare reversing entries, the January 31 and February 9 journal entries are:
Answer:
Journal Entries are:
January 31:
Debit Salaries Expense $1,500
Credit Salaries Payable $1,500
To accrue salary expense for 2 days.
February 9:
Debit Salaries Expense $5,700
Debit Salaries Payable $1,500
Credit Cash $7,200
To record the payment of salaries expense, including salaries payable.
Explanation:
a) Data and Analysis:
January 31: Salaries Expense $1,500 Salaries Payable $1,500
February 9: Salaries Expense $5,700 Salaries Payable $1,500 Cash $7,200
Which firm is the oligopolist? Choose one: Firm A is in retail. It is one of the largest and most popular clothing stores in the country. It also competes with many rivals and faces intense price competition. Firm B is in the auto rental business. It is not the nation’s largest rental company, but significant barriers to entry enable it to serve customers across the United States more conveniently and at a lower price than local rivals. Firm C is a restaurant in a small, isolated community. It is the only local eatery. People drive from miles away to eat there.
Answer:
Firm B is in the auto rental business. It is not the nation’s largest rental company, but significant barriers to entry enable it to serve customers across the United States more conveniently and at a lower price than local rivals.
Explanation:
For the given options we considered Firm B to be treated as the oligopolist as the firm nor its competitors would have the major impact over the market also there are entry & exit barriers from the market
So the firm B should be chosen as the oligopolist
Therefore the same should be considered and relevant
You are to make monthly deposits of $1,721 into a retirement account that pays 8 percent interest compounded monthly. If your first deposit will be made one month from now, how large will your retirement account be in 5 years?
Answer:
FV= $126,585.60
Explanation:
Giving the following information:
Monthly deposit (A)= $1,721
Interest rate (i)= 0.08/12= 0.0067
Number of periods (n)= 12*5= 60 months
To calculate the future value, we need to use the following formula:
FV= {A*[(1+i)^n-1]}/i
A= monthly deposit
FV= {1,721*[(1.0067^60) - 1]} / 0.0067
FV= $126,585.60
Operations Management:is a network of manufacturing and service options.is an essential function for primarily for-profit organizations.is narrowly dedicated to a single corporate function.focuses on decisions about the production and delivery of a firm s products and services.prioritizes sustainability over profits.
Answer:
focuses on decisions about the production and delivery of a firm's products and services.
Explanation:
Operations management can be regarded as a field of business which involves administration of business practices that carried out maximization of efficiency in a firm or an organization. It entails process such as planning, organizing, as well as taking responsibility for processes in organization in order to balance revenues as well as costs. It should be noted that Operations Management focuses on decisions about the production and delivery of a firm's products and services.
In 1 to 2 paragraphs, analyze how a person's ethics or values might affect his performance on the job
Answer:
In simple words, Individual workers' ethical convictions have an impact on team and department productivity as well as individual achievement. Being an ethical worker allows you to be a stronger team participant constantly contributing positively in group situations and just never impeding collective success.
Even though all individuals are important in and of themselves, ethical individuals can be more monetarily useful to their companies as well as more respected by their colleagues and competitors. Reflecting on workplace ethics may help you become a better employee, and it's a good thing to begin if you want to do the right thing all of the time.
Answer:
How can poor ethics devalue you as an asset on the team? Well, if you have poor moral standards and beliefs and what not, people can somewhat easily identify your personality as a negative trait. However if you're a good person with good values and spot on ethics, people will quickly realize that you're a good asset to have on the team.
Your energy, work ethic, and values also determine how good or bad your work ethic is.
Explanation:
For Connections Academy Career Development Unit Test
Consider the following demand schedule: Price Quantity Demanded $25 20 $20 40 $15 60 $10 80 What is the price elasticity of demand between (using the arc formula) a) Price $25-$20 a) Price $20-$15 a) Price $15-$10
Answer:
3.05
1.38
0.725
Explanation:
Price elasticity of demand measures the responsiveness of quantity demanded to changes in price of the good.
Arc elasticity of demand = midpoint change in quantity demanded / midpoint change in price
Midpoint change in quantity demanded = change in quantity demanded / average of both demands
Price $25-$20
change in quantity demanded = 40 - 20 = 20
average of both demands = (40 + 20) /2 = 30
Midpoint change in quantity demanded = 20/30 = 0.67
midpoint change in price = change in price / average of both price
change in price = $25 - $20 = $5
average of both price = ($25 + $20) / 2 = 22.5
Price $20-$15
change in quantity demanded = 60 - 40 = 20
average of both demands = (60 + 40) /2 = 50
Midpoint change in quantity demanded = 20/50 = 0.4
midpoint change in price = change in price / average of both price
change in price = $20 - $15 = $5
average of both price = ($15 + $20) / 2 = 17.5
midpoint change in price = 5 / 17.5 = 0.29
0.4/0.29 = 1.38
Price elasticity of demand = 0.67 / 0.22 = 3.05
change in quantity demanded = 80 - 60 = 20
average of both demands = (80 + 60) /2 = 70
Midpoint change in quantity demanded = 20/70 = 0.29
midpoint change in price = change in price / average of both price
change in price = $15 - $10 = $5
average of both price = ($15 + $10) / 2 = 12.5
5/12.5 = 0.4
On February 3, Smart Company sold merchandise in the amount of $2,700 to Truman Company, with credit terms of 1/10, n/30. The cost of the items sold is $1,865. Smart uses the perpetual inventory system and the gross method. Truman pays the invoice on February 8, and takes the appropriate discount. The journal entry that Smart makes on February 8 is:
Answer:
Journal entry on February 8 :
Debit : Cash $2,673
Debit : Discount received $27
Credit : Account Receivable $2,700
Explanation:
The journal entry that Smart makes on February should show the Cash payment net of cash discount, a decrease in Total Account Receivable balance and recognition of an expense discount allowed up to 1 %.
Describe the organizational structure of your school or company. What difficulties have you encountered working within this structure
Answer:
My company have a centralized structure of management framework. Under this structure all the decisions are made by the executive level managers of the company.
The main problem that me and my fellow workers face under this structure is that we do not get any space for creativity and judgement of our own. Also the organisation, do not emphasize on our suggestions that we believe can actually make us more efficient.
A developer of a new townhome community estimates that there will be 1,200 home (all types) sales in University City over the next year. An analysis of demographic information has revealed that the core market share for the townhome project within the community is 10%. Assuming a capture rate of 20%, what is the developer's first-year projection of townhome sales in the new community
PAnswer:
24 units
Explanation:
Calculation to determine what is the developer's first-year projection of townhome sales in the new community
First-year projection=10%*1200*20%
First-year projection=24 units
Therefore the developer's first-year projection of townhome sales in the new community is 24 units
Which of the following statements is CORRECT? Assume that the project being considered has normal cash flows, with one outflow followed by a series of inflows. Group of answer choices To find a project's IRR, we must find a discount rate that is equal to the WACC. A project's IRR is found by discounting the cash inflows at the WACC to find the present value (PV), then compounding this PV to find the IRR. None of these Answers To find a project's MIRR, we must solve for the discount rate that causes the PV of the inflows to equal the PV of the project's costs. A project's MIRR is found by compounding the cash inflows at the WACC to find the terminal value (TV), then discounting this TV at the WACC
At year-end, the following additional information is available: a. The balance of Prepaid Rent, $4,920, represents payment on October 31, 2018, for rent from November 1, 2018, to April 30, 2019. b. The balance of Deferred Revenue, $1,100, represents payment in advance from a customer. By the end of the year, $275 of the services have been provided. c. An additional $700 in salaries is owed to employees at the end of the year but will not be paid until January 4, 2019. d. The balance of Supplies, $2,100, represents the amount of office supplies on hand at the beginning of the year of $750 plus an additional $1,350 purchased throughout 2018. By the end of 2018, only $610 of supplies remains.
Question Completion:
The December 31, 2018, unadjusted trial balance for Demon Deacons Corporation is presented below.
Accounts Debit Credit
Cash $ 8,100
Accounts Receivable 13,100
Prepaid Rent 4,920
Supplies 2,100
Deferred Revenue $ 1,100
Common Stock 11,000
Retained Earnings 4,100
Service Revenue 37,520
Salaries Expense 25,500
Total $ 53,720 $ 53,720
Use the following additional information to prepare the adjusted Trial Balance.
Answer:
Demon Deacons Corporation
Adjusted Trial Balance
As of December 31, 2018
Accounts Debit Credit
Cash $ 8,100
Accounts Receivable 13,100
Prepaid Rent 3,280
Supplies 610
Deferred Revenue $ 825
Common Stock 11,000
Retained Earnings 4,100
Salaries Payable 700
Service Revenue 37,795
Rent Expense 1,640
Salaries Expense 26,200
Supplies Expense 1,490
Total $ 54,420 $ 54,420
Explanation:
a) Data and Analysis:
a. Rent Expense $1,640 Prepaid Rent, $1,640 ($4,920 * 2/6) rent from November 1, 2018, to April 30, 2019.
b. Deferred Revenue, $275 Service Revenue $275
c. Salaries Expense $700 Salaries Payable $700
d. Supplies Expense $1,490 Supplies $1,490
Accounts Debit Credit
Cash $ 8,100
Accounts Receivable 13,100
Prepaid Rent 4,920 - 1,640 = 3,280
Supplies 2,100 - 1,490 = 610
Deferred Revenue $ 1,100 -275 = 825
Common Stock 11,000
Retained Earnings 4,100
Salaries Payable 700
Service Revenue 37,520 + 275 = 37,795
Rent Expense 1,640
Salaries Expense 25,500 + 700 = 26,200
Supplies Expense 1,490
Total $ 53,720 $ 53,720
g A company shows a balance in Salaries and Wages Payable of $50,000 at the end of the month. The next payroll amounting to $75,000 is to be paid in the following month. What will be the journal entry to record the payment of salaries
Answer and Explanation:
The journal entry is
Salaries and Wages Payable $50,000
Salaries and Wages Expense $25,000
To Cash $75,000
(Being cash paid is recorded)
Here salaries & wages payable and salaries & wages expense is debited as it decreased the liabilities & increased the expense while the cash is credited as it decreased the assets
Compute the direct materials price variance and the direct materials quantity variance. (Indicate the effect of each variance by selecting for favorable, unfavorable, and no variance. Round "Cost per unit" answers to 2 decimal places.) AQ = Actual Quantity SQ = Standard Quantity AP = Actual Price SP = Standard Price
Question Completion:
A manufactured product has the following information for June.
Standard Actual
Direct materials 6 lbs. at $8 per lb. 48,500 lbs. at $8.10 per lb.
Direct labor 2 hrs. at $16 per hr. 15,700 hrs. at $16.50 per hr.
Overhead 2 hrs. at $12 per hr. $198,000
Units manufactured 8,000
Answer:
Direct materials price variance = $4,850 U
Direct materials quantity variance = $4,000 U
Explanation:
a) Data and Calculations:
Actual Standard
Direct materials price per lbs $8.10 $8.00
Direct labor rate per hour $16.50 $16.00
Quantity:
Direct materials 48,500 48,000 (6 * 8,000)
Direct labor hours 15,700 16,000 (2 * 8,000)
Direct materials price variance = SP - AP * AQ
= $8 - $8.10 * 48,500
= $0.10 * 48,500
= $4,850 U
Direct materials quantity variance = SQ - AQ * SP
= 48,000 - 48,500 * $8
= $4,000 U
An investment project has annual cash inflows of $4,200, $5,100, $6,300, and $5,500, and a discount rate of 15 percent. a. What is the discounted payback period for these cash flows if the initial cost is $6,900
Answer:
It will take 1 year and 307 days to cover the initial investment.
Explanation:
Giving the following information:
Initial investment= $6,900
Cash flows:
Cf1= $4,200
Cf2= $5,100
Cf3= $6,300
Cf4= $5,500
Discount rate= 15%
The payback period is the time required to cover the initial investment. We need to discount each cash flow.
Year 1= 4,200/1.15 - 6,900= -3,247.83
Year 2= 5,100/1.15^2 - 3,247.83= 608.50
To be more accurate:
(3,247.83 / 3,856.33)*365= 307 days
It will take 1 year and 307 days to cover the initial investment.
On January 1, 2024, an investor paid $261,000 for bonds with a face amount of $315,000. The contract rate of interest is 8% while the current market rate of interest is 10%. Using the effective interest method, how much interest income is recognized by the investor in 2025 (assume annual interest payments and amortization)
Answer:
$26,100
Explanation:
Calculation to determine how much interest income is recognized by the investor in 2025
Using this formula
Interest income = Amount paid* market rate of interest
Let plug in the formula
Interest income= $261,000*10%
Interest income= $26,100
Therefore the interest income that is recognized by the investor in 2025 will be $26,100
Carr Inc. purchased equipment for $100,000 on January 1, Year 1. The equipment had an estimated 10-year useful life and a $15,000 salvage value. Carr uses the 200 percent declining balance depreciation method. In its Year 2 income statement, what amount should Carr report as depreciation expense for the equipment
Answer:
$16,000
Explanation:
Calculation to determine what amount should Carr report as depreciation expense for the equipment
First step is to calculate Depreciation under Double declining Balance method
Depreciation under DDB = 2/10 x $100,000
Depreciation under DDB =$ 20,000
Now let calculate what amount should Carr report as depreciation expense for the equipment
Depreciation expense=2/10 *($100,000-$20,000)
Depreciation expense=2/10*$80,000
Depreciation expense= $16,000
Therefore what amount should Carr report as depreciation expense for the equipment is $16,000
A perfectly elastic supply curve is: Group of answer choices upward sloping to the right. vertical. horizontal. downward sloping to the left.
Answer:
vertical
Explanation:
Price elasticity of demand measures the responsiveness of quantity demanded to changes in price of the good.
Price elasticity of demand = percentage change in quantity demanded / percentage change in price
If the absolute value of price elasticity is greater than one, it means demand is elastic. Elastic demand means that quantity demanded is sensitive to price changes.
Demand is inelastic if a small change in price has little or no effect on quantity demanded. The absolute value of elasticity would be less than one
Demand is unit elastic if a small change in price has an equal and proportionate effect on quantity demanded.
The major advantage of a regular partnership or a corporation as a form of business organization is the fact that both offer their owners limited liability, whereas proprietorships do not. True False
Answer:
True
Explanation:
Some owners of a regular partnership (limited liability partnership) or a corporation (S-corporation) enjoy limited liability, unlike the owners of proprietorships, whose business liabilities and solvency are backed with the personal assets of the owners. The owners of a C-corporation enjoy full limited liability unless the corporate veil is lifted by the court, depending on prevailing circumstances. With limited liability also comes limited participation in the management of the entity.
Following are the transactions of a new company called Pose-for-Pics. Aug. 1 Madison Harris, the owner, invested $12,750 cash and $54,825 of photography equipment in the company in exchange for common stock. 2 The company paid $3,500 cash for an insurance policy covering the next 24 months. 5 The company purchased office supplies for $2,423 cash. 20 The company received $2,050 cash in photography fees earned. 31 The company paid $868 cash for August utilities. Prepare general journal entries for the above transactions.
Answer:
Aug 1
Dr Cash $12,750
Dr Photography equipment $54,825
Cr Common stock $67,575
Aug 2
Dr Prepaid insurance $3,500
Cr Cash $3,500
Aug 5
Dr Office supplies $2,423
Cr Cash $2,423
Aug 20
Dr Cash $2,050
Cr Photography fees earned $2,050
Aug 31
Dr Utilities Expense $868
Cr Cash $868
Explanation:
Preparation of general journal entries for the above transactions
Aug 1
Dr Cash $12,750
Dr Photography equipment $54,825
Cr Common stock $67,575
($12,750+$54,825)
Aug 2
Dr Prepaid insurance $3,500
Cr Cash $3,500
Aug 5
Dr Office supplies $2,423
Cr Cash $2,423
Aug 20
Dr Cash $2,050
Cr Photography fees earned $2,050
Aug 31
Dr Utilities Expense $868
Cr Cash $868