A tradeoff is a balance achieved between two desirable but incompatible feature. So the reasonable answer would be B
Answer:
Lopez Sales Company
1. Amount of Gross Margin recognized by Lopez:
Sales = $81,600
Less cost of sales = $38,400
Gross Margin = $43,200
2. Amount of the gain on the sale of land recognized by Lopez:
Land:
Selling price = $81,000
less Cost = $43,200
Gain on sale = $37,800
Explanation:
a) Gross margin is the difference between the selling price and the cost price of a product. It is the profit determined before business running expenses are deducted to obtain the net income or margin.
It measures the ability of the business to generate enough income to cover expenses that are normally incurred in business, like rent, utilities, and salaries and wages.
b) The Gain on sale of any capital asset is the difference between the selling price and the cost (book value). This gain is reported separately in the income statement and is the subject of capital gains tax.
Answer: c. Demand decreases and supply decreases.
Explanation:
When demand for tablets decrease, the demand curve shifts to the right. The price and quantity declines. At the same time, when supply also falls, the supply curve shifts to the left leading to an increase in price and a fall in quantity.
Since, decrease in demand and supply have opposite effect on the price there is no change in the price of tablets.
Both the forces work towards reducing quantity to quantity will fall unambiguously.
Thus, the correct option is c, Demand decreases and supply decreases.
Answer:
D. The market value of the bond approaches its par value as the time to maturity declines. The yield to maturity approaches the coupon interest rate as the time to maturity declines.
Explanation:
One explanation of the relationship that exists between the coupon interest rate and yield to maturity and the par value and market value of a bond, is that <u>the market value of the bond approaches its par value as the time to maturity declines. The yield to maturity approaches the coupon interest rate as the time to maturity declines.</u>
According to the definition of yield to maturity, it takes into consideration the coupon rate (i.e. the interest amount earned per year) for the number of years left to maturity, it is often higher because it treats the amount earned each year as being re-invested.
<u>Therefore the amount of yield to maturity will fall as the time to maturity nears and will approach the coupon rate</u>
Secondly, A bond's par value is the dollar amount it will be worth when it reaches maturity.
Before its maturity date, the bond may sell for more than par value on the secondary market as the yield it pays becomes more attractive to buyers.
<u>Therefore the difference between par value and market value is the yield. hence as maturity nears, yield to maturity falls and market value approaches par value because the bond is what its par upon maturity.</u>
