An Example of a Tying Arrangement Is

question 132

Multiple Choice

An example of a tying arrangement is

• A) a restaurant offering both Pepsi and Coca-Cola products.
• B) a car manufacturer installing expensive onboard GPS/navigation systems in all the cars it sells.
• C) a landlord offering free rent for the first month when a tenant signs a one-year lease.
• D) two companies competing on price.
• E) a coffee shop offering customers the option of having cream with their coffee for an extra 25 cents.

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Definitions:

Net Realizable Value

The estimated selling price of goods or assets in the ordinary course of business minus any costs involved in the sale or disposal process.

Accounts Receivable Turnover

A financial ratio that measures how efficiently a company collects revenue from its credit sales by comparing net credit sales with the average accounts receivable.

Net Realizable Value

The estimated selling price of goods minus the cost of their sale or disposal.

Direct Write-off Method

A method of accounting for bad debts that charges the amount directly to expense when it is determined to be uncollectible.