Answered: Not being able to take advantage of the…

Not being able to take advantage of the trade discounts does not mean that it is costly on the part of the company. * Right

Business Its Legal Ethical & Global Environment

10th Edition

ISBN:9781305224414

Author:JENNINGS

Publisher:JENNINGS

Chapter16: Business Competition: Antitrust

Section16.4: Vertical Trade Restraints

Problem 2CQ

See similar textbooks

Related questions

Q: What does a high ratio in Creditors Turnover Ratio indicate? a. Company is delaying the payment to…

A: Creditors Turnover Ratio measures how fast a company is paying off its creditors.

Q: Answer true or false to the follwoing statement, and explain “ Purchasing Power Parity (PPP) theory…

A: Buying power parity is a method of comparing the absolute purchasing power of currencies and, to…

Q: Whether the firm uses the market-based approach or the cost-based approach for pricing decisions,…

A: Introduction: Market based approach: For calculating the selling price of Asset firm uses market…

Q: Why Sales revenue does not include the residual value?

A: The residual value, also known as salvage value, is the estimated value of a fixed asset at the end…

Q: Disregarding the special circumstances when bases other than the point of sale are used, discuss the…

A: Revenue recognition is a generally accepted accounting principle (GAAP) that states the conditions…

Q: Not being able to take advantage of the trade discounts does not mean that it is costly on the part…

A: A discount represents the reduction in value of products or services sold-out within the business…

Q: Why does Sales discounts are variable consideration?

A: Variable considerations: Variable consideration refers to the amount that the corporation is…

Q: Cost accounting is used as a means of fixing a selling price. Select one: True False

A: Cost accounting is a method of managerial accounting which is used to calculate the total production…

Q: 1. When applying lower of cost or market, market value A. is defined as the selling price B.…

A: This Net realizable value(NRV) generally a common method used in valuation of an asset in inventory…

Q: Contrast the effects that LIFO vs. FIFO would have on ending inventory, net income and cash flow in…

A: Under LIFO(Last in first out) method: Inventory is valued at using the costs incurred for the…

Q: explain how sunk costs create a barrier to entry into the market place.

A: Sunk costs are expenses that can not be retrieved if a corporation wishes to leave a market.

Q: In an inflationary economy, the use of FIFO maximizes the cost of goods sold and minimizes the cost…

A: In an inflationary economy, the prices of goods keep on rising until the economy slows down. Thus,…

Q: Most companies report their lower of cost or market write-down expense as a O Cost of Goods Sold O…

A: Most companies report their lower of cost or market write-down expense as ______ expense even if the…

Q: f accepting a special order is an example of avoidable costs. True False

A: Avoidable cost are cost that can be avoided if a activity is not undertaken, resulting in cost…

Q: why would a business lean towards a rights issue rather than pay for long-term loans?

A: When a company is selling shares to its employees, existing shareholders and parties related to the…

Q: When a buying division purchases from outside supplier because the minimum transfer price is higher…

A: The maximum price is the price that can be paid by the buying decision so it may have no loss.

Q: Payments to a customer for slotting fees: a. can never be recognized. b. must be expensed…

A: Slotting Fees: it is the fees paid by the manufacturer to Retailer for putting their product on the…

Q: c) Explain why rights issues are usually made at a discount

A: Note: We’ll answer the first question since the exact one wasn’t specified. Please submit a new…

Q: The margin of safety is the amount that sales can drop before the company incurs a loss True False

A: Margin of safety = Actual sales - Break-even sales

Q: How to incease profitability if PE Ratio, EPS Ratio, and ROE cannot be calculated because of its…

A: Accounting refers to the process of recording, summarizing, interpretation and communicating the…

Q: What does a low ratio in Creditors Turnover Ratio indicate? a. Company collects the money fast from…

A: Ratio analysis means where different ratio of various years of years companies has been compared and…

Q: Companies that use OSD can deduct the cost of goods sold or the cost of services provided. Is it…

A: Business activities in every country are governed by certain Business laws that have direct…

Q: A key factor is one which restricts O The volume of sales The volume of production The volume of…

A: Key factors means those significant factors which can impact a business organisation to a great…

Q: Discuss the merits of the following objections to the sales basis of revenue recognition; 1.It is…

A: Sales basis of revenue recognition: It's means that revenue will be recognised when the title of…

Q: The application of the lower of cost or market rule to inventory valuation is an example of a. the…

A: The valuation of inventory is done at lower of cost or net realisable value as per relevant…

Q: Companies have found that offering discounts to customers in return for early payment can be…

A: The additional current assets that a corporation retains on its balance sheet as a liquidity buffer…

Q: sales commissions are regarded as a product costs true false

A: Period Costs are costs which are not assigned to the products but are charged as expenses against…

Q: Efficient customer service could be achieved through avoiding stock outs by making accurate A.…

A: Stock Out: The simple meaning is: When there is a demand in market for the product but the company…

Q: Which two economic concepts are fundamental to the relevance of fair values to accounting? i. The…

A: The two economic concepts are fundamental to the relevance of fair values to accounting are…

Q: One drawback to the weighted average method is that you might end up selling products at a loss True…

A: Weighted Average Method is a method of valuing the cost at an average value instead of their real or…

Q: Can you have a negative gross profit and if yes, explain why.

A: The gross profit margin measures how successfully a corporation produces money from direct…

Q: How does the inventory accounting choice (LIFO/FIFO) impact a firm's valuation? a)Deferring tax…

A: LIFO - Last in First Out method of inventory valuation is based on the concept that the newest…

Q: True or false: the new revenue recognition standard is aimed at a few industries and will not affect…

A: What is a New Revenue Recognition Standard ? ASC 606 is the new revenue recognition standard. Who…

Q: Why have some described the reported savings in cost-avoidance measures as “soft,” “funny money,”…

A: The company using the process to reduces the cost that increases the profit is known as cost…

Q: What are the repercussions of taking profit before the contracting company's obligations have…

A: Financial obligations are the obligations, which are referred to as the responsibility of an…

Q: n as a remedy for agency costs and -problems, and therefore create value in companies. However, in…

A: Debt are important source of capital but too much debt will create problems.

Question

Not being able to take advantage of the trade discounts does not mean
that it is costly on the part of the company.
Right
O Wrong

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

If the market value of goodwill is found to be lower than the book value, goodwill is __________ and must be adjusted by __________. A. worthless; reducing it with a credit B. impaired; reducing it with a credit C. impaired; increasing it with a credit D. worthless; increasing it with a credit
Companies that use OSD can deduct the cost of sales or the cost of services. Is it true or false?
1. From pages 5-1 and 5-2 of the VLN, which statement is FALSE as it relates to a trade discount? Group of answer choices A. It is a concept. B. The company provides a good or service at a reduced price. C. A contra revenue is recognized at the time of sale. D. It causes the sale to be recognized at the reduced, agreed upon price. 2. From pages 5-1 and 5-2 of the VLN, which of the following is FALSE as it relates to a sales discount? Group of answer choices A. It is an incentive to credit customers (customers who purchased on account) to encourage them to pay their invoice early. B. It is always recorded at the time of the sale. C. It is a contra revenue. D. It only applies to credit customers (customers who purchased on account). 3. From page 5-2 of the VLN, which of the following accounts are subtracted from sales to compute Net sales? Allowance for uncollectible accounts Deferred revenue Sales discounts Sales returns and allowances Accumulated depreciation Trade discount…
1. From pages 5-1 and 5-2 of the VLN, which statement is FALSE as it relates to a trade discount? Group of answer choices A. It is a concept. B. The company provides a good or service at a reduced price. C. A contra revenue is recognized at the time of sale. D. It causes the sale to be recognized at the reduced, agreed upon price.
What are the reasons that a company gives trade discounts?Why are trade discounts not recorded in theaccounts like cash discounts?
What are the disadvantages of cutting expenses/costs and utilising trade credit insurance, when it comes to working capital and operating cycle?
Companies that use OSD can deduct the cost of goods sold or the cost of services provided. Is it true or false?
Is it true that, when one firm sells to another on credit, the seller records the transaction as an account receivable while the buyer records it as an account payable and that, disregarding discounts, the receivable typically exceeds the payable by the amount of profit on the sale?
How can having a bonus system based purely on sales goals create an environment that encourages unethical behavior?
An item is considered material if:a. It doesn’t cost a lot of money.b. It is of a tangible good.c. It is likely to influence the decision of an investor or creditor.d. The cost of reporting the item is greater than its benefits
Hi so is the sales discount forfeited not used?
Which of the following is not a disadvantage of the LIFO inventory cost flow assumption? a. The impact of LIFO liquidation profits b. It does not match the most recent costs with revenue c. The possibility of income manipulation by management d. It impairs comparability between companies using LIFO