Because Lamar signs up for quickbooks, reconciliation will be quicker because most transactions will be matched already. So that, Lamar does not need wait too long for his reconciliation.
A QuickBooks can be defined as a financial management suite or full-featured business complete with tools for accounting, tax filing, invoicing, bank account tracking , inventory, payroll, and reconciliation. In accounting, Reconciliation can be defined as the process of comparing transactions and activity to supporting documentation. The function of reconciling account is to ensure that the money leaving an account matches the actual money spent.
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upon inspection, if goods are non-conforming, then the buyer may: group of answer choices just accept nonconforming goods and adjust the contract accordingly all of these are correct reject goods subject to cure reject goods and cancel the contract if a condition such as time being of the essence is present
If the goods are Non-Conforming goods, then the buyer can reject goods and cancel the contract if a condition such as time being of the essence is present.
Non-Conforming Goods: Non-conformances can arise in both the product and the process. Nonconforming Product is defined as Product that does not meet its stipulated specifications. Products that are nonconforming can result from nonconforming processes.
Example of Non-Conformity:
Frequent unauthorised alterations, distribution of untested items, and staff failing to address an issue's core cause are a few examples of major nonconformity.
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which of the following best describes current practice in accounting for leases? group of answer choices leases are not capitalized. all leases are capitalized. all long-term leases are capitalized. leases similar to installment purchases are capitalized.
Every lease is capitalized. The way lease accounting is now practiced is best summed up in this clause.
There are typically two different types of leases: short-term and long-term. Short-term leases are those where the lessee holds the leased asset for a short time, typically one year or less, and are therefore treated as operating leases.
Long-term leases, on the other hand, are those where the lessee holds the leased asset for a longer time, typically more than one year, and are therefore capitalized for more than one year. According to the lease accounting standard ASC 842, lease capitalization is the process of documenting right-of-use assets and associated lease obligations on a company's balance sheet.
The leased asset is capitalized in non-current assets on the balance sheet at the time of start-up. Both current and non-current liabilities have the relevant debt equivalent obligation. If the fair value of the lease is known, it should be capitalized at that amount.
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because trade raises as firms and workers play to their comparative advantage, trade will also cause the average level of wages in an economy to .
Because trade raises the amount that an economy can produce by letting firms and workers play to their comparative advantage, trade will also cause the average level of wages in an economy to rise
How does trade affect the economy?Trade is essential to the prosperity of the United States because it boosts economic expansion, promotes domestic employment, raises living standards, and enables citizens to sustain their families with reasonably priced goods and services. When labor is fixed and a country adopts free trade, the real wage in the export sector stays constant relative to the exported good while rising relative to the import good in both countries. Since rich countries, who have more capital and less labor, export items with a high labor content, trade drives up wages in developing nations' relative terms. Tariffs and other trade restrictions increase the cost of goods and services for American companies and consumers while reducing their supply, which lowers income, employment, and economic production. The first is a net wealth effect, which raises the overall demand for goods and services.The second consequence of terms of trade is an increase in the rate of return on producing nontraded commodities as a result of better terms of trade.To learn more about trade refer
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which statement is true of the marketing environment? multiple choice unemployment problems are a part of regulatory forces affecting the marketing environment. the public's opinions belong to the competitive forces influencing the marketing environment. a marketing manager can influence some environmental variables. environmental forces remain static. the forces in the marketing environment cannot be controlled under any circumstance.
A marketing manager can influence some environmental variables is a true statement of the marketing environment.
The marketing environment refers to all inner and outside elements, which without delay or indirectly have an impact on the company's decisions associated with advertising activities. internal elements are inside the manipulate of an corporation; whereas, external elements do now not fall within its control.
Market environment and enterprise environment are advertising and marketing terms that talk to factors and forces that affect a company's capacity to construct and preserve successful customer relationships.
A advertising surroundings encompasses all of the internal and external elements that power and have an impact on an corporation's advertising sports. advertising managers need to stay privy to the marketing surroundings to hold fulfillment and address any threats or possibilities which can affect their work.
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which of the following statements regarding insurable interest is not correct? a insurable interest must exist between the policyowner and insured at the time of application b insurable interest is the possibility of economic loss due to sickness or death c insurable interest only applies to individuals related by blood d an individual has an unlimited insurable interest on him/herself
It is possible to enforce a policy acquired by someone without an insurable stake in the insured. When the loss or damage of the object will result in a financial loss or other troubles, that person or entity has an insurable interest in that thing, event, or action.
It's crucial to note that insurable interest must be able to be valued in monetary terms. Sentimentality is not a must. When Insurable Interest Must Exist Depending on the type of insurance, several rules apply to the question of when insurable interest must exist. Any investment that is vulnerable to financial loss is protected by insurable interest.
According to the principle of insurable interest in life insurance, a person or organization may purchase a life insurance policy on the life of another if they place a higher value on the life of the insured than the policy's face value.
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An asset turnover ratio of 2.5 means that for every $1 in assets, the firm generates _____ in sales.
An asset turnover ratio of 2.5 means that for every $1 in assets, the firm generates $2.5 in sales. A company's sales or revenues are compared to the value of its assets using the asset turnover ratio.
The asset turnover ratio can be used to gauge how effectively a business uses its assets to produce income. The more effectively a corporation uses its assets to generate revenue, the greater its asset turnover ratio. A corporation is not effectively employing its assets to produce sales if it has a low asset turnover ratio, on the other hand. Investors can use this measure to gauge how well a company is utilising its resources to drive sales.
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a company mails consumers cards telling them they have won valuable prizes. when a consumer attempts to collect her prize, she discovers that she must pay $500 to collect the goods. in this case the ftc is likely to
In this case the FTC is likely to seek a consent decree to end the practice.
What does the FTC do and what does it stand for?The Federal Trade Commission (FTC) is a federal regulatory body in the United States tasked with keeping an eye on and stopping unfair, misleading, or anticompetitive business practices. It is a separate government organization whose main duties are the promotion of consumer protection and the enforcement of civil (non-criminal) antitrust law.
Federal consumer protection laws are thus enforced by the FTC to stop fraud, deceit, and unfair commercial practices. The Commission also upholds federal antitrust rules, which forbid anticompetitive mergers and other commercial activities that can result in higher costs, fewer options, or less innovation.
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on february 7, a customer buys 100 shares of lmn at $39 per share and simultaneously writes an lmn oct 35 call option at 6. if the call is exercised on july 19, what will she report for tax purposes?
Tax - $200 gain, The $4,100 profit from the sale of the stock includes the premium paid for writing the call. The investor made a $200 capital gain by purchasing the stock for $3,900 five months earlier (short-term).
What is tax?
Tax compliance refers to policy actions as well as individual behaviour that aim to ensure that taxpayers are paying this same right amount of tax just at right time and securing this same correct tax allowances and tax reliefs. Tax is defined as a mandatory financial charge or another category of levy imposed on the a taxpayer (an individual or legal entity) by the a governmental organisation in order to fund government spending as well as various public expenditures. Around 3000–2800 BC, Ancient Egypt experienced the first recorded taxation. Non-compliance with the law includes avoiding taxes or resisting taxation, as well as failing to make payments on time.
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If you use a work without the creator's permission, you could be breaking what law?
A.
Image law
B.
Web law
C.
Copyright law
D.
Citation law
the manager of a large apartment complex knows from experience that 90 units will be occupied if the rent is 300 dollars per month. a market survey suggests that, on the average, one additional unit will remain vacant for each 10 dollar increase in rent. similarly, one additional unit will be occupied for each 10 dollar decrease in rent. what rent should the manager charge to maximize revenue?
The rent that should be charged by manager to maximize revenue is 540 dollars per unit.
The question can be solved by expressing it in the form of Quadratic polynomial. A quadratic polynomial is the one that can be expressed in the form ax² + bx + c = 0 where a, b, c are coefficients and x is the independent variable. Let us assume the rent as x. The rent will be given by
R(x) = (90 - x)(300 + 6x)
R(x) = 27000 + 540x - 300x - 6x²
R(x) = 27000 + 240x - 6x²
R(x) will be maximum at
-240/(2)(-6) = 20
The manager should charge the rent which is equal to
R = 300 + 12(20) dollars per unit
R = 540 dollars per unit.
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The rate of inflation in zimbabwe rose in 2018 from 10. 6% to 577. 21% in 2020. What was the positive effect of this unexpected inflation on the residents of the country?.
Borrowers benefit from unexpected inflation since the money they pay back is less valuable than the money they loaned.
Inflation decreases the purchasing power of money. As a result, if the borrower pays an interest rate that is lower than the inflation rate, he profits. This happens because the real value of the money returned by the borrower is less than the value of the money borrowed. If a company's profits increase due to inflation, it can pay out dividends to its shareholders. As a result, during inflationary periods, shareholders' dividend income may increase.
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blaire contracted with a local print shop to print her weekly sales flyers and other advertising materials. every month, the print shop will deduct the cost of the month's printing from her company's checking account. how can blaire ensure the transactions are categorized properly? answer:
Blaire can ensure that the transactions are categorized properly by creating a bank rule. With creating a bank rule, it will help Blaire reconcile regular cash payments into Blaire's bank account.
A bank can be defined as a financial institution licensed to make loans. and receive deposits. Bank rule can be described as an automatically process transactions imported from bank feeds or a bank statement. Bank rule has a function to automatically set the type of transaction, ledger account, or customer or supplier If we are import similar transactions every month, such as direct debits, set up rules.
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susan tynan, shop steward for unite here local 1, says that the wages for housekeepers have increased to over $14 per hour and the company wants to take them back to $8.83 per hour. considering this statement, which of the following is the most likely reason the company is against unionization? problems with temporary vs. full-time employees profitability concerns concerns about their freedom for managing employees concerns about creating inefficiencies at work
The option that is most likely reason the workers elected to unionize is option C: concerns about their freedom for managing employees
What problems are there in an organization?When an employee does not feel content in their job, it is called job discontent. This may be the result of a variety of personal and professional factors, including a lack of advancement, subpar management, a lack of work-life balance, and others.
Note that Poor management is a major factor in why workers perform poorly at work and as such the workers in the above scenario are in dissatisfaction with the management.
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a film studio in georgia is responsible for creating the sets for films. every year, about 10% of last year's sets get destroyed and can no longer be used. over the course of a year, the studio builds 10 sets and can make $5,000 a year per set. the studio had 80 sets last year; how much can the studio expect to make from sets this year?
A film studio in georgia is responsible for creating the sets for films. every year, about 10% of last year's sets get destroyed and can no longer be used.
Since we have given that
Number of total films = 40 studio
Percentage of comedies = 60%
Number of comedies is given by
Percentage of horror films = 40%sets
Number of horror films is given by
Percentage of comedies were profitable = 75%
Number of profitable comedies is given by
Percentage of horror were unprofitable = 75% studio
Percentage of horror were profitable = 25%
Number of profitable horror films is given by
So, Total number of profitable films were sets
Hence, there are 22.5 films were profitable.
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to increase sales, a sportswear chain is designing a promotional campaign for social media. it plans to post links to coupons on its website and have its sales personnel scan the coupon redemption codes at store registers. which are the best social media information system (smis) metrics to track the success of this promotion?
All plans in Sprout include presentation-ready social media reports that can be filtered by platform and date.
This implies that you have simple access to customizable graphs and comparisons to earlier time periods, as well as easy access to team leaders and executives.
What key measure should social media companies focus on?
Engagement, impressions and reach, voice and share of voice, referrals and conversions, reaction rate and time are the most prevalent and frequently significant indicators to consider. You will have a 360-degree view of your social media performance when these are combined.
It's important to track the broad category of engagement.
The engagement rate is a measure that is frequently used to monitor how actively engaged your audience is with your content and how successful your brand efforts are. Customers who are actively engaged engage with brands through behaviors like "likes," "comments," and social sharing.
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A large retailer obtains merchandise under the credit terms of 1/10, net 40, but routinely takes 50 days to pay its bills. (Because the retailer is an important customer, suppliers allow the firm to stretch its credit terms.) What is the retailer's effective cost of trade credit? Assume a 365-day year. Do not round intermediate calculations. Round your answer to two decimal places.
If a large retailer obtains merchandise under the credit terms of 1/10, net 40, but routinely takes 50 days to pay its bills. The retailer's effective cost of trade credit assuming a 365-day year is 9.60%.
Effective Cost of Trade CreditUsing this formula
Effective Cost of Trade Credit = {1+(D/100-D)}^ (365 / Days after Discount Period) -1
Let plug in the formula
Effective Cost of Trade Credit = [1 + ( 0.01 /0.99 ) ] ^[ 365 / (50−10)]−1
Effective Cost of Trade Credit = [1 + ( 0.01 /0.99 ) ] ^[ 365 / (40)]−1
Effective Cost of Trade Credit =1.096046171−1
Effective Cost of Trade Credit = 096046171 × 100
Effective Cost of Trade Credit = 9.60%
Therefore the 9.60% is the effective Cost of Trade Credit.
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a company figured that if it had 50 more employees and paid each one $2 per day less, the payroll would increase $650 per day. if it had 50 less employees and paid each $4 per day more, the payroll would decrease $700 per day. how many employees does the company now have?
Since increasing the number of employees by 50 and decreasing the wage by $2 will result an increase in payroll by $650, then the current number of employees is 125.
Let
x = the current number of employees
y = the current wage per day
If the number of employees added by 50 and the wage decreases $2, then the payroll increases $650. It means:
(x + 50) (y - 2) = xy + 650
xy + 50y - 2x - 100 = xy + 650
-2x + 50y = 750 (Equation 1)
If the number of employees decreases by 50 and the wage increases $4, then the payroll decreases $700. It means:
(x - 50) (y + 4) = xy - 700
xy - 50 y + 4x - 200 = xy - 700
4x - 50y = -500 (Equation 2)
Add both equations:
-2x + 50y = 750
4x - 50y = -500 +
2x = 250
x = 125
Hence, the current number of employees is 125.
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hen significant externalities exist: i. the market equilibrium is no longer efficient. ii. the market equilibrium is only efficient if the externality is an external benefit. iii. social surplus is not maximized. iv. the government will always increas
When significant Externalities exist the market equilibrium is no longer efficient.
Externalities create market failure because the pricing equilibrium of a good or service does not fairly reflect the full costs and advantages of that good or service. Equilibrium is believed to create the ideal level of output since it reflects the optimal balance between the advantages for customers and the expenses for producers. When there are considerable externalities, however, the equilibrium level is faulty because incentives are created that lead individual agents to make poor judgments for the community as a whole.
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what type of assessment method is being used if a formal job offer is made only when the candidate passes a background check? screening assessment evaluative assessment contingent assessment organizational assessment
Contingent assessment method is being used if a formal job offer is made only when the candidate passes a background check
Describe contingent assessment methods.The last step in the external hiring process is contingent assessments, which are started when a candidate accepts a conditional job offer. Contingent evaluations are requirements that must be satisfied before an offer is finalized, as opposed to tests that judge a candidate's cognitive talents, technical knowledge, or job skills.
Applicants who succeed in the substantive selection processes are essentially prepared for employment, subject to a background investigation. Drug tests, physical examinations, and background checks are the three most frequently used contingent procedures. Nevertheless, depending on the requirements of the task and the law, contingent approaches are not always employed. Contingent techniques can be utilized with almost any method.
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a broker has the buyer's earnest money deposit deposited in an escrow account. the amount of the deposit exceeds the amount of the broker's commission for the sale. the broker may remove his commission on this sale only: select one: a. when the buyer moves into the property. b. when the seller moves out of the property. c. when the closing is completed. d. whenever the seller says it is ok to do so
A broker has the buyer's earnest money deposit deposited in an escrow account. the amount of the deposit exceeds the amount of the broker's commission for the sale. the broker may remove his commission on this sale only when the closing is completed.
Commissions are a shape of variable-pay remuneration for offerings rendered or merchandise offered. Commissions are a commonplace way to encourage and reward salespeople. Commissions also can be designed to inspire specific income behaviors. For example, commissions may be decreased while granting big reductions. Or commissions can be increased while promoting certain merchandise the company desires to promote. Commissions are normally carried out inside the framework of income incentive software, which could include one or a couple of fee plans (each typically based totally on an aggregate of territory, role, or products). Payments have regularly calculated the usage of a percent of sales.
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larry south is leasing property from jim west. larry south transfers the rights of his leasehold estate to joe north. the transaction occurred because of:
Both a contractual and a real estate interest—here known as a leasehold interest—are created by a lease between a landlord and a tenant.Even when a lease is quiet in some areas, the lessee and lessor are presumed to be protected by the legal concept of leasehold.
What does the legal term leasehold mean?
A leasehold estate gives the tenant a right to use the property, but it does not give them ownership of it.This kind of estate is typically outlined in a formal lease that is signed by both the renter and the property owner (the lessor) (the lessee). A lease in a non-freehold estate, which is a real estate contract that does not impart ownership interest or rights to the title of a piece of real property, grants a property lessee temporary occupancy rights known as a leasehold interest. The freeholder receives payments from you in the form of service fees and rising ground rent.To make changes to the property, you need the freeholder's written consent; there can be significant costs involved.Pets may not be permitted for you.Your ability to operate a business from home may be limited. You are in charge of maintaining anything inside your home or that is only related to your home as a leaseholder.This includes paying all outstanding fees for services, maintenance, upgrades, insurance, and ground rent. The right to use and occupy a flat for an extended period of time, or the "term" of the lease, constitutes leasehold ownership of a flat.The typical duration of this is 99 or 125 years, during which time the apartment may be purchased and sold.Since the duration of the term is fixed from the beginning, it gets shorter every year. The property technically reverts to the freeholder's ownership at the end of the lease.However, since you may keep extending the lease, this rarely occurs.In fact, an extension is your legal entitlement if you've held the lease for more than two years. The Land Registry typically registers the title with absolute or good leasehold title for leased properties.Rarely, qualifying or possessory leasehold titles will be awarded; your attorney will let you know if this is the case in your situation. When a property's leasehold period is up, it reverts to being a freehold, meaning the freeholder owns both the building and the land.Even if you have paid off your mortgage and bought the home fully, you will have no legal claim to it until the lease expires.To learn more about leasing property refer
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the cutting edge sells ice skates. total sales are $845,000, total variable expenses are $245,050 and total fixed expenses are $302,000. the variable expense ratio is blank . multiple choice question. 35% 100% 29% 71%
The Cutting Edge sells ice skates. Total sales are $845,000, total variable expenses are $245,050 and total fixed expenses are $302,000. The variable expense ratio is 29%.
What is the variable expense ratio?Generally, A company's variable expenditures are expressed as a percentage of its total sales in the variable expense ratio.
To get the variable expenditure ratio for a firm, just take the entire variable costs for the company and divide that number by the company's total net sales. Simply multiplying the value by 100 will allow you to describe it as a percentage.
To get the variable expenditure ratio for a firm, just take the entire variable costs for the company and divide that number by the company's total net sales. Simply multiplying the value by 100 will allow you to describe it as a percentage.
Therefore
The variable expense ratio = $245,050/ 845,000
The variable expense ratio = 0.29
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gladstone company has expected sales of $352,000 for the upcoming month and its monthly break-even sales are $332,500. what is the margin of safety as a percent of sales?
The safety margin as a share of sales is 5.54%.
The break-even point amount is deducted from the actual or projected sales, and the result is divided by sales; the result is stated as a percentage in accounting.
What percentage is a good margin of safety?The vast majority of value investors often won't buy a security unless the MOS is estimated to be between 20 and 30 percent. The investor will only buy a security if the current share price is 20% less than the intrinsic value determined by their valuation if the hurdle is set at 20%.The margin of safety will be determined as a percentage of sales as follows: (expected sales - break even sales) / anticipated sales = ($352000 - $332500) / $352000 = $19500 / $352000 = 0.0554 = 5.54%The margin of safety demonstrates the amount that sales can decline before a company experiences a loss. Profit, regardless of break-even point, simply indicates how much loss or income was produced during the accounting period.To learn more about margin of safety refer to:
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Brickhouse is expected to pay a dividend of $2. 50 and $2. 20 over the next two years, respectively. After that, the company is expected to increase its annual dividend at 2. 6 percent. What is the stock price today if the required return is 10 percent?.
The company increases its dividends by 1.65 percent annually.
In exchange for regular interest payments, a bondholder loans money to a business or the government for a predetermined length of time. As soon as the bond matures.
What features distinguish a bond?Bonds can be identified by their maturity, coupon (interest) rate, tax status, and callability, among other attributes. Bonds are subject to a number of hazards, including interest rate risk, credit/default risk, and prepayment risk. The majority of bonds have ratings that indicate their investment grade.These investment-grade bonds have the highest quality and are thought to have the lowest default rates. Typically, investment-grade bonds of the highest caliber are regarded as U.S. Treasury bonds.Corporate bonds, municipal bonds, government bonds, and agency bonds are the four different types of bonds that can be categorized.In exchange for regular interest payments, a bondholder loans money to a business or the government for a predetermined length of time. As soon as the bond matures.To learn more about Bond refer to:
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the two major avenues for achieving low-cost leadership are both accomplished by focusing on the company's multiple choice question. target pricing. market share. level of product or service differentiation. value chain activities.
The major avenues for achieving a cost advantage over rivals include:
performing value chain activities more cost-effectively than rivals or revamping the firm's overall value chain to eliminate or bypass some cost-producing activities.What is meaning of low-cost leadership?
The goal is to manufacture (or acquire) comparable goods or services for less money than its rivals. The bulk of buyers will be drawn in by the cheaper price, and it will be profitable based on the quantity of goods sold.
The additional costs spent by manufacturing more units of an item or service are known as marginal costs. By dividing the overall change in the cost of manufacturing additional items by the change in the quantity of goods produced, it is determined.
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scarcity is a problem: group of answer choices measured by the amount of goods available. of the poor, but not the rich. only in industrialized economies. because human wants are unlimited while resources are limited.
Shortage is the fundamental financial issue. It emerges from the lacking of assets to fulfill people's needs. Shortage is omnipresent.
Wealthy individuals confront shortage when they need more than they can purchase, when they can't be in two places at once, and when, in like manner, they must select among alternatives.
Social orders can bargain with shortage by expanding supply. The more products and administrations accessible to all, the less shortage there will be. Of course, expanding supply comes with impediments, such as generation capacity, arrive accessible for utilize, time, and so on. Another way to bargain with shortage is by decreasing wants.
What is shortage and issue of choice in economics?Scarcity alludes to the limited nature and accessibility of assets whereas choice alludes to people's choices around sharing and utilizing those assets. The issue of shortage and choice lies at the exceptionally heart of financial matters, which is the consider of how people and society select to designate rare assets.
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If a higher level of production allows workers to specialize in particular tasks, a firm will likely exhibit ________ of scale and ________ average total cost.
If a higher level of production allows workers to specialize in particular tasks, a firm will likely exhibit economies of scale and falling average total cost
What Are Economies of Scale?Economies of scale are financial benefits businesses enjoy as production becomes more productive because costs may be divided over a larger number of products.The ability of a company to benefit from economies of scale depends on its size; bigger businesses will produce more goods and save more money.Scale economies might be internal or external. External causes have an impact on the entire sector Internal economies are driven by conditions within a particular firm.Several factors contribute to economies of scale resulting in cheaper per-unit costs. First, increased worker specialization and technological integration increase production rates. Second, cheaper per-unit expenses may result from supplier bulk orders, larger advertising purchases, or lower capital costs. Third, spreading internal function costs over a greater number of manufactured and sold units aids in cost reduction.To learn more about economies of scale, refer to https://brainly.com/question/780900
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when a pr specialist employed by a hospital writes and distributes a newsletter to medical staff and other employees, what type of communication is this?
when a pr specialist employed by a hospital writes and distributes a newsletter to medical staff and other employees. This is a type of internal communication.
What is communication?Communication is the acquisition of information from one party to another. According to the Merriam-Webster dictionary, communication can be defined as the process or act of writing, speaking and gesturing to exchange, express and convey internal information and ideas. In our daily lives, communication helps us build relationships and connect with others by sharing our experiences and needs. It is the essence of life that allows us to express emotions, share information, and share internal ideas. It's important to understand each communication style and why individuals use it. The communication process consists of four main components. Internal components include coding, transmission media, decoding, and feedback. There are two other factors in this process, and these two factors exist in the form of sender and receiver.To learn more about communication from the given link :
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in the mid-1980s, coke launched new coke, a soft drink featuring a new cola taste. it did not do well. a few weeks after new coke launched, it was discontinued. coke returned to its original formula and rebranded it coca-cola classic. new coke is an example of
New coke is an example of failed value creation.
The first formula modification in 99 years was made when The Coca-Cola Company released reformulated Coca-Cola, also known as new Coke. The Coca-Cola Company wanted to revitalize its Coca-Cola brand and the cola category in its greatest market, the United States, rather than to incite the avalanche of customer criticism that eventually occurred.
Not only did New Coke fail due to its too sweet flavor, but Coke's marketing strategies, organizational structures, and corporate culture also contributed to its failure.
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galaxy company sold merchandise costing $3,600 for $6,200 cash. the merchandise was later returned by the customer for a refund. the company uses the perpetual inventory system. what effect will the sales return have on the financial statements? (consider both the revenue and inventory effects of the return only.)
Total assets and total equity decrease by $900.
What is perpetual inventory system?Instead of conducting a physical inventory, a perpetual inventory system uses software to continuously estimate your inventory based on your electronic records. The baseline for this system is a physical count, and it is updated as a result of incoming purchases and outgoing shipments.
The most typical application of a perpetual inventory system is the use of wireless barcode scanners in a grocery shop. Every transaction that is scanned is immediately recorded on the system. Firms are able to compute the current and necessary stockpile quickly in this method.
According to perpetual FIFO, the oldest or initial costs are deducted from the inventory account and added to the cost of goods sold account first. The cost of the ending inventory and the cost of the products sold will be the same for both the perpetual FIFO cost flows and the periodic FIFO cost flows.
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The complete question is:
Galaxy Company sold merchandise costing $1,700 for $2,600 cash. The merchandise was later returned by the customer for a refund. If the perpetual inventory method is used, what effect will the sales return have on the accounting equation?
A) Total assets and total equity decrease by $900.
B) Total assets decrease by $2,600 and total equity is decreased by $1,700.
C) Total assets and total equity decrease by $2,600.
D) Total assets and total equity increase by $900.