Impact of transaction on net operating income

Assignment Help Accounting Basics
Reference no: EM13143659

ABC Company accepted a national credit card for a $2,500 purchase. The cost of the goods sold is $2,000. The credit card company charges a 3% fee. What is the impact of this transaction on net operating income?

a. increase by $485.

b. increase by $425.

c. increase by $2,425.

d. increase by $500.

Reference no: EM13143659

Questions Cloud

How to support the ceo-s claim : A random sample of 35m of the firm's accountants has a mean workday of 8.2 hours with a standard deviation of 0.5 hour. At α = 0.01, can you support the CEO's claim?
What is the amount of the distribution : May Inc., has one shareholder,Paula, whose basis in May's stock was $100,000 on 1/1/10. During 2010, May distributed $300,000 to Paula. What is the amount of the distribution that would be treated as a dividend by Paula?
Record sales and collections during the period : Prepare the entries to record sales and collections during the period. Prepare the entry to record the write-off of uncollectible accounts during the period. Prepare the entries to record the recovery of the uncollectible account during the period.
What is a project? : What is a project?What are the basic phases of the project lifecycle and their purposes?
Impact of transaction on net operating income : ABC Company accepted a national credit card for a $2,500 purchase. The cost of the goods sold is $2,000. The credit card company charges a 3% fee. What is the impact of this transaction on net operating income?
Similarities and differences of neanderthals : Similarities and differences of Neanderthals, Cro-Magnons, and Homo Sapiens.
In social psychology : In social psychology, one of the main ways of studying how people interact with each other and their group behavior is through observation. One aspect of observation is through understanding the media
Is finagle a bagel a tall or flat organization? : Is finagle a bagel a tall or flat organization?
Identify and analyse what are the potential problems : Identify and analyse what are the potential problems associated with this accounting standard, the IASB’s actions to improve this standard?

Reviews

Write a Review

Accounting Basics Questions & Answers

  Broad strategies following by company

Generally, companies follow one of two broad strategies: offering a quality product at a low price, or offering a unique product or service priced higher than the competition. Assume you are opening a small food outlet across the street from your ..

  Manufacturing needs or selling product

Market conditions are such that sales made internally or externally will not affect market or transfer prices. Intermediate markets will always be available for Bayside, Cole, and Diamond to purchase their manufacturing needs or sell their product..

  Determine the standard cost variances

For the last 1,000 bag batch determine the standard cost variances for the direct materials, direct labor, and variable overhead.

  How do you value the obsolete inventory

There are several methods, LIFO, FIFO, Weighted Average, Market, and Historical Cost. If you are in the retail/wholesale business, would you use the same method that you would use if you were in the manufacturing business?

  Evaluate the potential impact various stages of production

Evaluate the potential impact an upgrade can have on cost identification during the various stages of production an upgrade can have on cost identification during the various stages of production

  Prepare the t-account entries for stock transactions

Prepare the T-Account entries for the following stock transactions of the ALEXANDER Corporation: Issued 1000 shares of $2 par common stock for $68 per share. The down payment is $52 per share with the remainder to be paid in three months.

  Accounting roles-business organization

What is the difference between a role-based and principle-based system? Discuss Global Reporting initiatives, its purposes, the standard setting process and the use of its reporting system.

  Preferred shareholders-common stockholders

What amount of dividends must the company pay the preferred shareholders in 2009 if they wish to pay the common stockholders a dividend?

  How operating income be affected

If Hoffman accepts the special order, the company would not have to pay its salespeople their normal commission of $2 per unit, but the company would incur a shipping cost of $3 per unit on the items in the special order. If Hoffman accepts the sp..

  Amount of depreciation needs to be recaptured

The factory building was transferred to his son, John, as an inheritance at the time of wade's death and John sells it immediately after inheriting it at a gain of $30,000 based on the original cost. What amount of depreciation needs to be recaptu..

  Warranty expenditures throughout the year

In the current year, Hanna Company reported warranty expense of $190,000 and the warranty liability account increased by $20,000. What were warranty expenditures during the year?

  Absorbtion versus variable costing

Lockhart had no units in beginning inventory. During 2009, 6,000 units were produced and 5,000 units were sold. Which of the following statements is true when comparing net income using absorption versus variable costing?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd