16. Break-even 1

Following is a simple income statement. Match each term with its definition from the drop-down list of choices. Income Statement

Scorpion4ik [409]

Answer:

Matching each term with its definition:

Income Statement (thousands of dollars) Year 1

A. Revenues (Sales) 7,000 : 1. Money generated by a firm's products or services

B. Cost of Goods Sold (2,781) : 2. Cost associated with making and selling the firm's products

C. Operating Expenses (1,809) : 3. Cost of generating the current period's revenues including rent, wages, supplies and general and administrative expenses.

D. Operating income (EBIT) 2,410 : 4. Shows the profit or loss a firm makes before paying taxes

E. Interest expense (190) : 5. Cost of servicing the firm's debt.

F. Taxes payable 2,220 : 6. Earnings before interest and taxes

G. Taxes (434) : 7. Includes all Federal, State and Local taxes paid by the firm

H. Net income 1,786 : 8. The profit (or loss) made by the firm

I. Cash Flow Statement : 13. Shows cash from operating, investing, and financing activities

J. Accounting Equation : 10. Assets = Liabilities + Equity

K. Net Income : 11. Profits generated by an organization

L. Balance Sheet : 9. "Snapshot" of a company's activities at a given point in time

M. Income statement : 12. Shows revenues, expenses, and profitability over a period of time

N. Liquidity : 14. How quickly assets can be converted into cash

Explanation:

8 0

1 year ago

Which of the following elements are included on the hierarchy of hazard control?

Vsevolod [243]

Answer:Implementing administrative controls Implementing engineering controls

Explanation:

8 0

1 year ago

Four roommates are planning to spend the weekend in their dorm room watching old movies, and they are debating how many to watch

gulaghasi [49]

Answer:

See the five answers below.

Explanation:

The roommates are debating how many movies they should watch.

This is the constraint; given that they have to pay to rent each movie.

PART (A)

Since their dormitory room is the 'cinema', meaning that it's just going to be 4 of them and a private good that they'll pay for; then the showing of a movie is not a public good!

Public goods are those general utilities usually provided by governments, for their citizens; e.g. public defense, clean drinking water, good roads, etcetera.

PART (B)

Given the 'willingness to pay' constraint, we need to find the optimal number of movies they can watch. It costs $8 to rent a movie, no matter how interesting it is or how much satisfaction the viewers derive from it. So the cost of the 1st film = the cost of the 2nd film = the cost of the 3rd film = the cost of the 4th film = the cost of the 5th film.

To get the total amount they're willing to pay for all 5 movies, sum up!

(10+9+6+3) + (9+7+4+2) + (8+5+2+1) + (7+3+0+0) + (6+1+0+0)

KEY: This arrangement should remind you of the law of diminishing marginal utility. The more movies they watch in one sitting or over a weekend, the less satisfaction they derive from the intangible commodity. Hence, the less they are willing to pay for more of the commodity.

So the sum is 28 + 22 + 16 + 10 + 7 = 83

Now to get the number of movies they should rent if they wish to maximize their total spending, divide the total willingness to pay by the cost for a movie:

83/8 = 10.375

Rounding up to the nearest whole number or in reality, that's 10 movies.

PART (C)

Suppose the roommates choose to rent this optimal number of movies - which is higher than the intended number of movies - and then split the cost equally, what will each roommate pay?

Here, we will use the approximated value 10.

10movies x $8 = $80

Splitting the cost equally, divide by 4

$80 ÷ 4 = $20

This figure is just in obedience to the question's requirements which says the bill must be shared equally. In actual fact, some of the four roommates don't have a purchasing power or willingness that is up to $20! That's Felix and Larry.

PART (D)

Complete the given table by inputing each roommate's total willingness to pay for the 5 movies and the surplus each person obtains from watching the movies. Remember to assume that Van is the same person as Raphael.

Also, total cost for 5 movies is 8 x 5 = $40

Dividing this by 4, you have $10 per roommate. So a surplus would be the excess of each roommate's TWTP over $10.

TWTP($) CS($)

VAN 40 30

CARLOS 25 15

FELIX 12 2

LARRY 6 -4

PART (E)

If the cost is divided up based on the benefits (remember how the price for movie was static despite the movie and satisfaction received by each viewer? That's about to change) or satisfaction each roommate receives, the practical problem with this 'solution' is that each roommate has an incentive to reduce the value of the movies to him; and this can only be measured by the efficient number (the number that rates the value each roommate derives from each movie). In this case, the incentive is the window given to each roommate to 'not tell the truth' about their level of satisfaction from watching each movie, because that would mean a higher bill for the individual.

KUDOS!

4 0

1 year ago

Sebastian Belle has performed $2,000 of CPA services for a client but has not billed the client as of the end of the accounting

Volgvan

Answer: The answer is: Debit Account Receivable $2,000; Credit Unearned Revenue $2,000.

Explanation: The accounting entries above were premised on the accrual accounting concept, which states that income and expenses are recognized as they occur regardless of when actual cash settlement takes place. The amount was credited to unearned revenue simply because the client has not been billed and there is not further information on the duration of the service. Therefore, the amount would be unwound from the unearned revenue to income, based on the duration of service and percentage of completion. However, when the client pays, the account receivable account would be credited.

3 0

2 years ago

Identify how planned investment will change in each scenario. Airwings, a commercial airline manufacturer, becomes optimistic ab

Vladimir79 [104]

Answer:

Part - 1: Increase

As business is hopeful about future,it will begin limit extension to provide food customer request.

Part - 2: Decrease

Higher genuine loan fee implies acquiring cost is higher for the organizations thus that they will lessen the interest in response to that.

Part - 3: Decrease

A lower charge implies higher benefits and firms can pass these advantages to purchasers with lower costs, to representatives with higher wages and to the administration with charge on benefit. Nonetheless, in the event that the pace of expense itself has been expanded, at that point all things considered corporate will consider higher to be as a dampener in suppositions and they may diminish venture plans.

Part - 4: Decrease

A downturn implies there will be lesser monetary movement generally speaking and request will be lower so as the utilization. In such case, arranged speculation will be diminished.

5 0

2 years ago