Marginal Revenue

 Marginal revenue is the increase in revenue that results from the sale of one additional unit of output. While marginal revenue can remain constant over a certain level of output, it follows from the law of diminishing returns and will eventually slow down as the output level increases.

Comments

Post a Comment

Popular posts from this blog

Wage and Tax Statement Data on Employer FICA Tax

Image
  Ehrlich Co. began business on January 2, 20Y8. Salaries were paid to employees on the last day of each month, and social security tax, Medicare tax, and federal income tax were withheld in the required amounts. An employee who is hired in the middle of the month receives half the monthly salary for that month. All required payroll tax reports were filed, and the correct amount of payroll taxes was remitted by the company for the calendar year. Early in 20Y9, before the Wage and Tax Statements (Form W-2) could be prepared for distribution to employees and for filing with the Social Security Administration, the employees' earnings records were inadvertently destroyed. None of the employees resigned or were discharged during the year, and there were no changes in salary rates. The social security tax was withheld at the rate of 6.0% and Medicare tax at the rate of 1.5%. Data on dates of employment, salary rates, and employees’ income taxes withheld, which are summarized as follows, ...
Read more

Plastic Corporation acquired EIGHTY (80%) PERCENT of Synthetic Corporation's ordinary share on January 1,2012 for

  Plastic Corporation acquired EIGHTY (80%) PERCENT of Synthetic Corporation's ordinary share on January 1,2012 for P 210,000 Cash. The Shareholder's equity of Synthetic at this time consisted of P 150,000 ordinary shares and P 50,000 Retained earnings The difference between the price paid and the underlying rquity acuired was due to a P 12,500 undervaluation of Synthetic's inventory, a P 25,00 undervaluatio of Synthetic's equipment, and goodwill The undervalued inventories were sold by Synthetic during the year, and the undervalued equipment had a remaining life of FIVE years. Synthetic owed Plastic 4,000 on Accounts Payable at December 31,2012. The separate financial statements of Plastic and Synthetic Corporations at end of year are as follows: BALANCE SHEET PLASTIC SYNTHETIC Cash 29,500 30,000 Trade receivables-net 28,000 40,000 Dividends receivable 8,000 Inventories 40,000 30,000 Land 15,000 30,000 Buildings-net 65,000 70,000 Equipment-net 200,000 100,000 Investmen...
Read more

On July 10, 2020, Waterway Ltd. sold GPS systems to retailers on account for a selling price of $780,000 (cost $624,000).

Image
  On July 10, 2020, Waterway Ltd. sold GPS systems to retailers on account for a selling price of $780,000 (cost $624,000). Waterway grants the right to return systems that do not sell in three months following delivery. Past experience indicates that the normal return rate is 15%. By October 11, 2020, retailers returned systems to Waterway and were granted credits of $74,000. The company follows IFRS. Prepare Waterway’s journal entries to record the sale on July 10, 2020.  Prepare Waterway’s journal entries to record the $74,000 of actual returns on October 10, 2020. ( Hint:  Use Accounts Payable for the amount returned.) Answer.
Read more