Inflation imposes many costs on the economy: shoe-leather costs, money illusion, menu costs, wealth redistribution, price confusion, future price level uncertainty, and tax distortions.

a. True
b. False

Answers

Answer 1

Answer: True

Explanation:

Inflation refers to the decline in the purchasing power of a currency over time. Inflation creates shoe leather cost which refers to the cost of time and.the effort by which individuals spend so as to mitigate the effects of inflation, like holding fewer cash.

Also, inflation creates money illusion as there's reduction in the value of money that one holds. Inflation creates menu costs as prices goes up. It also brings about wealth redistribution, price confusion, future price level uncertainty, and tax distortions.

Therefore, the correct option is True.


Related Questions

Consider the baggage check-in process of a small airline. Check-in data indicates that from 9am to 10am, 190 passengers checked in. Moreover, based on counting the number of passengers waiting in line, airport management found that the average number of passengers waiting for check-in was 56.

Required:
How long did the average passenger have to wait in line?

Answers

Answer:

17.68 minutes

Explanation:i

In order to calculate the average time passenger had to wait in line, we would first divide the average number of passengers check-in in with the passengers checked in from 9 am to 10 am (which was the highest number of check-ins of the day). Then we would multiply that number by 60 minutes. As shown below:

First,

= 56 average number of passengers checked-in / 190 passengers checked-in from 9 to 10 am

= 0.2947

Then

= 0.2947 x 60 minutes

= 17.68 minutes

Hence, 17.68 minutes did the average passenger wait in line.

On January 1, 2020, Sandhill Co., a calendar-year company, issued $2320000 of notes payable, of which $580000 is due on January 1 for each of the next four years. The proper balance sheet presentation on December 31, 2020, is:

Answers

Answer:

Current liabilities $2320000; Long-term Debt, $1740000

Explanation:

Calculation to determine what The proper balance sheet presentation on December 31, 2020, is:

Current Liabilities will be $2320000 of notes payable

Hence,

Current liabilities $2320000

Long -term Debt =$2320000-$580000

Long -term Debt=$1740000

Therefore The proper balance sheet presentation on December 31, 2020, is:

Current liabilities $2320000; Long-term Debt, $1740000

Which of the following statements accurately describe the effect of the increase in government borrowing?

a. National saving decreases by less than $20 billion.
b. Investment increases by less than $20 billion.
c. Public saving decreases by exactly $20 billion.
d. Private saving increases by less than $20 billion.

Answers

Answer:

d. Private saving increases by less than $20 billion.

Explanation:

Because the interest rate has increased, investment and national saving decline and private saving increases. The increase in government borrowing reduces public saving. From the figure you can see that total loanable funds (and thus both investment and national saving) decline by less than $20 billion, while public saving declines by $20 billion and private saving rises by less than $20 billion.

quizlet

A large bakery buys flour in 25-pound bags. The bakery uses an average of 4200 bags a year. Preparing an order and receiving a shipment of flour involves a cost of $10.70 per order. Annual carrying costs are $76 per bag. Determine the EOQ. (Keep two decimal places in your answer)

Answers

Answer:

34

Explanation:

Annual demand D = 4,200 bags

Ordering cost S = $10.70

Holding cost H = $76

Economic order quantity = [tex]\sqrt{2*D*S / H[/tex]

Economic order quantity = [tex]\sqrt{2*4200*$10.70 / $76}[/tex]

Economic order quantity = [tex]\sqrt{89880/76}[/tex]

Economic order quantity = [tex]\sqrt{1182.63}[/tex]

Economic order quantity = 34.389388

Economic order quantity = 34

Selma has developed and patented a new process for recycling discarded tires. A multinational corporation has expressed an interest in buying her company in order to gain access to the technology and keep it exclusively for itself. Should Selma sell her company, the buyer will have acquired technology via

Answers

Answer:

acquisition of the technology owner

Explanation:

In the given scenario a multinational corporation has expressed an interest in buying her company in order to gain access to her technology (a new process for recycling discarded tire).

The corporation is trying to obtain this technology by acquisition of the technology owner.

When they purchase Selma's company they will automatically own the technology.

Another method that can be used to get the technology would have been through liscensing. Where they will get permission to use the technology with the permission of the owner.

A ________ is a repository of customer information that records all of the contacts a customer has with a firm, and generates a customer profile that is available to appropriate individuals in the firm.

Answers

Answer:

CRM system

Explanation:

During April, Cavy Company incurred factory overhead as follows:

Indirect materials $11,600
Factory supervision labor 3,700
Utilities 500
Depreciation (factory) 600
Small tools 230
Equipment rental 720

Journalize the entry to record the factory overhead incurred during April.

Answers

Answer and Explanation:

The journal entry is given below:

Factory Overhead  $17,350

   Materials $11,600

   Wages Payable  $3,700

   Utilities payable  $500

   Accumulated Depreciation $600

   Small tools  $230

   Equipment Rental payable $720

(To record the factory overhead incurred during April)

Here the factory overhead is debited as it increased the expense and credited the payable accounts as it increased the liabilities, credited the material, accumulated depreciation and small tools

Articles of the code of ethics are broad statements of ethical principles and the standards of practice support, interpret and amplify the respective articles

Answers

Answer: True

Explanation:

The Code of Ethics is the detailed document where the professional responsibilities of every professional is written. It should be noted that the Code of Ethics is made up of seventeen Articles and their related Standards of Practice.

The Articles of the code of ethics are broad statements of ethical principles while the standards of practice support, interpret and amplify the respective articles. Therefore, the Statement is true.

The statement given in the query holds true and the code of ethics are a set code of instructions that are to be followed by the business professionals in the manner as prescribed.

The code of ethics are a set manner of instructions that are like a law book to be followed by the different kinds of businessmen and professionals of their field.

Code of ethics are given by the respective authoritative institutes of which such businessmen or professionals are the members. it implies the way in which the practice can be done.

Code of ethics contain respective articles for communication, outfit and attire, verbal and written communication and all such other fields which contribute to the maintained decency in the professional conduct.

They are generally different for professionals of different streams. Like they are different for superiors and subordinates of the same organization as well given their subjective roles.

Hence, the statement given about the code of ethics above holds true that they must be followed and acted accordingly and implied at each stage of practice.

To know more about code of ethics, click the link below.

https://brainly.com/question/3010649

K Company estimates that overhead costs for the next year will be $2,967,000 for indirect labor and $860,000 for factory utilities. The company uses direct labor hours as its overhead allocation base. If 86,000 direct labor hours are planned for this next year, how much overhead would be assigned to a product requiring 6 direct labor hours

Answers

Answer:

$267.00

Explanation:

First and foremost, it should be borne in mind that the overhead per direct labor hour is the total forecast overhead costs for next year divided by the planned direct labor hours, in essence, we simply determine plantwide overhead allocation rate, which is the basis for determining the amount of direct to be assigned to 6 direct labor hours

plantwide overhead allocation rate=(indirect labor overhead+factory utilities)/planned direct labor

indirect labor overhead cost=$2,967,000

factory utilities=$860,000

planned direct labor hours=86,000

plantwide overhead allocation rate=($2,967,000+$860,000)/86000

plantwide overhead allocation rate=$44.50

overhead allocation to a product requiring 6 direct labor hours=6*$44.50

overhead allocation to a product requiring 6 direct labor hours=$267.00

Both the demand curve and the supply curve are straight lines. If the price is $4 but only 6 units are bought and sold, producer surplus will be

Answers

Answer:

$12

Explanation:

Producer's surplus=1/2*Q*P( Just like the formula for the area of a triangle which is 1/2*base*height)

P is the price of the item which is $4

Q is the quantity bought and sold, which is 6 units in this case, hence, the producer surplus is shown thus

producer's surplus=1/2*$4*6

producer's surplus=$12

A code of ethics for IT auditors and organizations primarily helps to set clear ___________. IT guidelines financial guidelines career goals expectations

Answers

Answer: IT guidelines

Explanation:

In the IT audit process, a computer system is checked to see if it not only performs the duties for which it was set up, but also if it protects the assets of the company and maintains data integrity.

A code of ethics for such a process would therefore be one that helps set clear IT guidelines to ensure that the computer system does what it is supposed to do and protects the company's assets as well.

Miller Company is constructing a building. Construction began on January 1 and was completed on December 31. Expenditures were $12,800,000 on March 1, $10,560,000 on June 1, and $16,000,000 on December 31. Miller Company borrowed $6,400,000 on January 1 on a 5-year, 12% note to help finance construction of the building. In addition, the company had outstanding all year a 10%, 3-year, $12,800,000 note payable and an 11%, 4-year, $24,000,000 note payable. What is the actual interest for Miller Company

Answers

Answer:

Miller Company

The actual interest for Miller Company is:

= $4,688,000.

Explanation:

a) Data and Calculations:

Expenditures:

March 1 $12,800,000

June 1   $10,560,000

Dec. 31 $16,000,000

Notes Payable:                                                   Amount       Actual Interest

January 1: 5-year, 12% Construction Loan = $6,400,000        $768,000

Year's: 3-year, 10% Note Payable =               12,800,000         1,280,000

Year's: 4-year, 11% Note Payable =               24,000,000        2,640,000

Total                                                             $43,200,000      $4,688,000

George H. Ruth takes a leave of absence from his job to work full time for a charity for six months. Ruth fills the position of finance director, a position that normally pays $88,000 per year. Ruth accepts no remuneration for his work. What recording does the charity make

Answers

Answer: a contributed support of $44000 and a expense of $44000.

Explanation:

From the information given in the question, we are informed that Ruth fills the position of finance director, a position that normally pays $88,000 per year.

Therefore, the amount earned for six months will be:

= $88000 × ½

= $44000

Therefore, the recording of the transaction will be a contributed support of $44000 and a expense of $44000.

The cost of materials transferred into the Rolling Department of Keystone Steel Company is $553,600 from the Casting Department. The conversion cost for the period in the Rolling Department is $107,500 ($64,300 factory overhead applied and $43,200 direct labor). The total cost transferred to Finished Goods for the period was $622,800. The Rolling Department had a beginning inventory of $27,900.

Required:
a. Journalize the cost of transferred-in materials.
b. Journalize the conversion costs.
c. Journalize the costs transferred out to Finished Goods.

Answers

Answer:

Keystone Steel Company

Journal Entries:

a. Debit Work in Process $553,600

Credit Transferred-in materials $553,600

To record the cost of transferred-in materials.

b. Debit Work in Process $107,500

Credit Factory overhead $64,300

Credit Payroll $43,200

To record the conversion costs.

c. Debit Finished Goods Inventory $622,800

Credit Work in Process $622,800

To record the costs transferred out to Finished Goods.

Explanation:

a) Data and Calculations:

Cost materials transferred into the Rolling Department = $553,600

Conversion cost for the period = $107,500

Factory overhead applied = $64,300

Direct labor = $43,200

Cost transferred to Finished Goods for the period = $622,800

Work in process, beginning inventory = $27,900

a. Work in Process $553,600 Transferred-in materials $553,600

b. Work in Process $107,500 Factory overhead $64,300 Payroll $43,200

c. Finished Goods Inventory $622,800 Work in Process $622,800

The records of Pippins, Inc., included the following information: Net sales $ 1,000,000 Gross margin 475,000 Interest expense 50,000 Income tax expense 80,000 Net income 240,000 Compute the times interest earned ratio, rounded to the nearest decimal.

Answers

Answer:

the times interest earned ratio is 7.4 times

Explanation:

The computation of the times interest earned ratio is given below/;

Times interest earned ratio is

= EBIT ÷ interest expense

where

EBIT = Net Income + Interest Expense + Income tax Expense

= 240,000 + 50,000 + 80,000

= 370,000

Now the times interest earned ratio is

= $370,000 ÷ $50,000

= 7.4 times

Hence, the times interest earned ratio is 7.4 times

Sales-Related Transactions
Merchandise is sold on account to a customer for $7,400, terms FOB shipping point, 1/10, n/30. The seller
paid the freight of $390. Determine the following:
a.
Amount of the sale

b.
Amount debited to Accounts Receivable

c.
Amount received within the discount period
7,326 X

Answers

Answer:

a. Particulars                       Amount

Sales revenue - Gross        $7,400

Less: Sales discount           $74       ($7,400*1%)

Net sales revenue               $7,474

b. Particulars                                                Amount

Sales revenue-Net                                        $7,474

Add: Freight paid on behalf of purchaser   $390  

Account receivable debited                        $7,864

c. Particulars                                    Amount

Total amount due                           $7,938

Less: Sales discount ($7,400*1%)   $74  

Net amount to be received            $7,864

Where do you see Dow Jones in the coming two years ?

Answers

Dow jones the business, is that what you or asking sorry just want to make sure so i answer the question correctly

A bond has a coupon rate of 8% and matures in 10 years. What are its expected cash flows if this bonds have a principal amount of $1000 and pay interest semi-annually

Answers

Answer:

$1080

Explanation:

Calculation to determine the expected cash flows

Since the bonds have a principal amount of the amount of $1000 first step is to calculate the Cash flow CO1

CO1=$1000(.08)/2

CO1=$80/2

CO1= $40

Second step is to calculate the Frequency of PMT

Frequency of PMT= 10 years x 2 (semi-anually)

Frequency of PMT= 20

Now let determine the Cash Flow CO10

Cash Flow CO10=1000+80

Cash Flow CO10=$1080

Therefore the expected cash flows is $1080

The projected capital budget of Kandell Corporation is $500,000, its target capital structure is 60% debt and 40% equity, and its forecasted net income is $500,000. If the company follows a residual dividend policy, what total dividends, if any, will it pay out

Answers

Answer:

the  total dividend pay out in the case when the residual dividend policy followed is $300,000

Explanation:

The computation of the total dividend pay out is given below:

= Net income - (equity × capital budget)

= $500,000 - (0.40 × $500,000)

= $500,000 - $200,000

= $300,000

Hence, the  total dividend pay out in the case when the residual dividend policy followed is $300,000


Large manufacturing businesses do not usually sell correctly to consumers
True
False

Answers

Answer:

"directly" no, they usually have middlemen that distribute the product to consumers.

Explanation:

Cereal brands at supermarkets.

Calculate gross profit for the following situation: National Storage Company had sales of $1,000,000, sales discounts of $2,500, sales returns and allowances of $15,000, and a cost of goods sold of $525,000.

Answers

Answer:

$475,500

Explanation:

Sales is $1,000The discountscount is $2500

Sales return and allowances are $15,000

The cost of goods sold is $525,000

Therefore the gross profit can be calculated as follows

= 1,000,000-2,500-15,000-525,000

= 457,500

Hence the gross profit is $475,500

principal, $3000 × annual interest rate, 5/2% × years​​,7/2

Answers

Answer:

$262.5

Explanation:

p=$3000

R=5/2%

T=7/2 years

hence ,

interest= p×t×r/100

= (3000×5/2×7/2)/100

= (30×35/4)

= (7.5 × 35)

=$262.5

Fosters Manufacturing Co. warrants its products for one year. The estimated product warranty is 2% of sales. Assume that sales were $1,500,000 for January. On February 7, a customer received warranty repairs requiring $325 of parts and $120 of labor.

Required:
a. Journalize the adjusting entry required at January 31, the end of the first month of the current of current fiscal year, to record the accrued product warranty.
b. Journalize the entry to record the warranty work provided in February.

Answers

Answer: Please see answer in explanation column

Explanation:

a)Account titles and explanation                  Debit                         Credit

Warranty Expense                                       $30,000

Warranty Payable                                                                           $30,000    

Calculation :

2 % x $1,500,000 =$30,000

b) Account titles and explanation                  Debit                         Credit

Warranty Provision                                           $445

Materials                                                                                             $325

Salaries Payable                                                                                  $120

MC Qu. 98 Garcia Corporation's April sales forecast... Garcia Corporation's April sales forecast projects that 6,100 units will sell at a price of $10.60 per unit. The desired ending inventory is 10% higher than the beginning inventory, which was 1,100 units. Budgeted purchases of units in April would be:

Answers

Answer:

Total budgeted purchases = $65,826

Explanation:

Budgeted purchases

Sales forecast = 6,100 units

Ending inventory 1,100 * 110% = 1,210 units

Required units = 7,310

- Beginning inventory = 1,100 units

Units to be purchased = 6,210

Cost per unit = $10.60

Total budgeted purchases = $65,826

g A company has beginning inventory of 16 units at a cost of $24 each on February 1. On February 3, it purchases 34 units at $26 each. 22 units are sold on February 5. Using the FIFO periodic inventory method, what is the cost of the 22 units that are sold

Answers

Answer:

$188

Explanation:

FIFO method assumes that the units to arrive first will be sold first. Hence the cost of sales will be valued using the prices of earlier or older units.

Cost of Sales = 16 units x $24  + 6 units x $26

                      = $188

Thus,  the cost of the 22 units that are sold is $188.

Geraldo is a customer care executive at a telecommunications service provider. He receives a complaint from a customer about an unnecessary $20 charge on his phone bill. If the company follows the customer service management process, Geraldo is most likely to _____.

Answers

Answer:

Provide a quick response to the customer using customer care software.

Explanation:

Software Programs

This is simply regarded as a service tool or software distribution model where software applications are hosted by a vendor or service provider and made available to customers over a network that is often the internet.

There are some of the software that is available. They includes the following:

Inventory managementReceivingStore Replenishment POS etc.

Marketing Channel

This is used by individuals and firms involved in making a product or service available for use or consumption by consumers or industrial users.

A downside to absorption costing is: ____________

a. not including fixed manufacturing overhead in the cost of the product
b. that it is not really useful for managerial decisions
c. that it is not allowable under GAAP
d. that it is not well designed for cost-volume-profit analysis

Answers

Answer: that it is not well designed for cost-volume-profit analysis

Explanation:

Absorption costing refers to the managerial accounting method that is used for capturing all the costs that are associated with the manufacturing of a product. In this case, the direct costs and the indirect costs are all accounted for through the use of this method.

Some of the downside to absorption costing include the fact that it isn't

helpful in a scenario whereby improvement in the financial and operational efficiency is to be analysed. Also, the true reflection of the profit of a business may not be given and it is not well designed for cost-volume-profit analysis.

Therefore, the correct option is D.

An advance payment of $1,000 for services was received on December 1 and was recorded as a liability. By the end of the year, $400 had been earned. Demonstrate the December 31 adjusting entry by choosing the correct statement below.

a. Debit Service revenue for $400.
b. Debit Unearned revenues for $400.
c. Debit Unearned revenues for $600.
d. Credit Unearned revenues for $400.

Answers

Answer:

b. Debit Unearned revenues for $400.

Explanation:

When money is received in advance for a service that is yet to be rendered, the money is accounted for as a liability called deferred or unearned income.

The entries are

Dr Cash

Cr Deferred revenue

when the service is rendered, revenue is said to be earned with the following entries passed

Dr Deferred revenue

Cr Revenue

Hence when $1,000 for services was received on December 1 and was recorded as a liability

Dr Cash   $1,000

Cr Deferred revenue  $1,000

when $400 had been earned

Dr Deferred revenue  $400

Cr Revenue  $400

Option b is right

b. Debit Unearned revenues for $400.

A loan officer states, "Thousands of dollars can be saved by switching to a 15-year mortgage from a 30-year mortgage." Calculate the difference in payments on a 30-year mortgage at an interest rate of .75% a month versus a 15-year mortgage with an interest rate of .7% a month. Both mortgages are for $100,000 and have monthly payments. What is the difference in total dollars that will be paid to the lender under each loan?

Answers

Answer:

$113,465

Explanation:

Calculation to determine difference in total dollars that will be paid to the lender under each loan

First step is to Calculate the difference in payments on a 30-year mortgage at an interest rate of .75% a month

$100,000 = PMT([1 / (0.0075)] − 1 / {(0.0075)[(1.0075)]^30 × 12})

PMT = $804.62

Second step is to Calculate the difference in payments on a 15-year mortgage at an interest rate of .7% a month

$100,000 = PMT([1 / (0.007)] − 1 / {(0.007 )[ 1.007)]^15 × 12})

PMT = $ 978.87

Now let determine the Total difference

Total difference = ($804.62 × 12 × 30) − ($978.87 × 12 × 15)

Total difference= $113,465

Therefore difference in total dollars that will be paid to the lender under each loan is $113,465

The most common measure of inflation is a static called the _____
1. Nominal measurement
2. Consumer price index
3. Anual rate
4. US Bureau of Labor Statistic

Answers

Explanation:

The most common measure of inflation is a statistic called the Consumer Price Index (CPI).

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