The expenditure method: the sum of the total expenditure on goods and services by households, govts and exports . (the value of exports minus the value of imports) 3. The income method: The sum of the income generated in the production of goods and services, which includes profits, wages and other employee payments, econome from rent and interest earned. Production, income and the circular flow diagram: The circular flow diagram shows the flow of spending and money in the economy. It illustrates the equality between GDP measured from the income and expenditure methods.
B. should always be equal to net realizable value less a normal profit margin. C. should always be equal to net realizable value. D. is always the middle value of replacement cost, net realizable value, and net realizable value less a normal profit margin. 16) The retail inventory method is based on the assumption that the A. ratio of cost to retail changes at a constant rate. B. proportions of markups and markdowns to selling price are the same.
Define the price elasticity of demand and show how it is calculated. Answer: The units-free measure of the responsiveness of the quantity demanded of a good to a change in it s price when all other influences on buying plans remain the same. 3. What is the total revenue test? Explain how it works.
By following the matching principle all of the costs associated with a particular product, not just its wholesale price, is expensed when the item is sold. Requirement 2 - A Generally, the lower of cost or market method is used to value inventory in order to “avoid reporting inventory at an amount greater than the benefits it can provide” (Spiceland, Sepe, & Nelson, 2013, p. 476). According to Spiceland, Sepe, and Nelson (2013) the “change in replacement cost usually is a good indicator of the direction of change in selling price” (p. 477). When the change in replacement cost is negative the LCM method allows companies to apply the conservatism principle. The conservatism principle involves “recognizing expenses and liabilities as soon as possible when there is uncertainty about the outcome, but to only recognize revenues and assets when they are assured of being received” (The conservatism principle).
EGT1 - Economics Subdomain: 309.1 - Task 1 A. Profit Maximization a1. The total revenue (TR) to total cost (TC) approach relies on the fact that profit equals revenue minus that cost and focuses on maximizing the greatest difference between TR and TC. Total Revenue (TR): Is the income derived from the sales of a given product. (McConnell., 2011) This total does not take include the cost of producing the product.
WEEK 3 Assignment – Questions: 7-7) Active income is income received by the taxpayer directly from the taxpayer’s efforts or services. For example, salary, wages, and commissions. Passive Income is income received usually on a regular basis with little to no effort of the taxpayer. There are only two sources of passive income, “income from rental activity, and from a business in which the taxpayer does not materially participate. http://www.irs.gov/businesses/small/article/0,,id=146330,00.html.” Dividends, interest, annuities, and royalties not accumulated through the ordinary course of trade or business is Portfolio income, not passive income.
First, according to the ASC 605-25-25-6, “a delivered item or items that do not qualify as a separate unit of accounting within the arrangement shall be determined for those combined deliverables as a single unit of accounting.” If the Power starterpack is not a separate deliverable, it shall be considered as a single unit of accounting, which is not a separate unit of accounting. Power starterpack is sold as a bundle, and only one stream of revenue. That means the activation card has to be sold as combination with service, and only recognize $200 as revenue. 2. The activation card is a separate deliverable and a separate unit of accounting.
Part 1 Terminology Macroeconomics use terminology that is rather distinct from other fields of study. To describe the massiveness of a nation’s economy a numerical measurement is essential. There are many ways to measure economic activity, but a single, common measure is important for purpose of comparison between two different countries or even the same country to itself at different times. Economists have generally agreed that the best measure is the Gross Domestic Product (GDP). This is the sum of cost of all the final products and services sold in any economy.
Calculate the PAYG instalment income and the instalment due to the ATO. Complete the BAS Summary boxes below. Using a general journal format, explain how the payment transaction would be recorded in the accounting system. Supplies you have made Total sales & income & other supplies including capital (GST inclusive) G1 Exports Other GST-free supplies Input taxed sales & income & other supplies ADD G2 + G3 + G4 G1 minus G5 G6 Adjustments (must be total transaction value, i.e. GST inclusive) ADD G6 + G7 Divide G8 by eleven G9 66 191 728 100 G2 G3 Acquisitions you have made Capital acquisitions (GST inclusive) All other acquisitions (GST inclusive) ADD G10 + G11 Acquisitions for making input taxed sales & income & other supplies Acquisitions with no GST in the price Total estimated private use of acquisitions + non-income tax deductible acquisitions ADD G13 + G14 + G15 G7 G8 0 728 100 G12 minus G16 Adjustments (must be total transaction value, i.e.
These scores are the quantitative measure of the ability to start, operate, and close a business, the absence of tariff and non-tariff barriers that affect imports and exports of goods and services, the tax burden imposed by government, the level of government expenditures as a percentage of GDP, the price stability with an assessment of price controls the amount, the freedom to invest, the banking efficiency and its independence from government control and interference in the financial sector, the assessment of the ability of individuals to accumulate private property, the various aspects of the legal and regulatory framework of a country’s labor market, and the freedom from corruption (Heritage Foundation, 2011). The 2011 Index of Economic Freedom shows a positive relationship between economic freedom and prosperity. The basic conclusion from the data indicates that increasing levels of economic freedom have a high correlation with increasing levels of per capita GDP and