The manufacturers of several designer purses have met and agreed not to sell their purses to Jolie's Department Store because of Jolie's practice of discounting all items 20 percent below the retail costs at other stores. The manufacturers are concerned about maintaining their images of exclusivity and quality. The agreement among the manufacturers:
A) is valid because of their need to protect their product.
B) violates the Sherman Act because it is a boycott.
C) is valid because the rule of reason applies and they have a valid reason.
D) None of the above
B
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If the gross amount of an invoice is $2,500 and a trade discount of 20% is allowed, the amount of the trade discount would be
a. $500; b. $250; c. $50; d. $25; e. none of these.
Which of the following statements is TRUE?
A) Indirect costs must be allocated based on a single plant wide rate. B) Manufacturing overhead costs are accumulated in cost pools and then assigned to products. C) Managers cannot wait until the end of the accounting period for product cost information. D) Managers can choose to wait until the end of the accounting period to allocate manufacturing overhead costs.
Answer the following statements true (T) or false (F)
1. All available-for-sale debt investments are reported as long-term assets on the balance sheet. 2. The unrealized holding gains and losses on available-for-sale debt investments are reported on the income statement. 3. The unrealized holding gains and losses on available-for-sale debt investments are recorded as an adjustment to the Unrealized Holding Gain—Available-for-Sale account or Unrealized Holding Loss—Available-for-Sale account. 4. The Unrealized Holding Gain Available-for-Sale account and Unrealized Holding Loss—Available-for-Sale account are included the Other Income and (Expenses) section of the income statement.
Melody Company sells a product for $14, variable costs are $10 per unit, and total fixed costs are $5,040. If Melody wants to earn an operating profit of $880, how many units must it sell?
A) 1,480 B) 1,260 C) 1,040 D) 62 E) 247